MIT’s "Future of Solar" Study Says It’s Ready for Prime Time Now

(3Bl Media/Justmeans) - A multi-disciplinary team from the MIT Energy Initiative project produced the “Future of Solar Energy” report as part of a series of studies. The report found that while solar accounts for less than 1% of the American electricity supply today, its contribution in the future is capable of growing to what they call “multi-terawatt scale.” Considering that the global generation capacity today is a little over five terawatts—that is significant. Considering the inherently clean, low-carbon nature of solar power, it clearly is potentially “an essential component of a workable strategy to mitigate climate change risk.” The study addresses a wide array of solar options including solar thermal concentrating  (CSP) plants, which, given their cost and complexity are best suited to utility-scale multi-MW installations, to photovoltaic (PV) systems, which can range from a 10kW residential rooftop system, to a utility scale installation covering many acres. While CSP has thermal storage inherently built in, PV systems have none, requiring batteries, or grid-backup or some other storage means to sustain power in the absence of sunshine.

After a detailed assessment, the 356-page study concludes that there are few obstacles standing in the way. The raw materials and commodities, such as copper, aluminum and glass are plentiful enough to meet the projected peak demand in 2050 of 25 TW. Solar power could, says the report, become a major market driver for these commodities.

While this amount of capacity is a substantial stretch from where the industry is today, there are some existing demonstrations of its potential to scale up. First Solar’s 550 MW Topaz Solar project in California came online last October. The array consists of 9 million solar modules covering an area of 9.5 square miles. Two other plants of equal or greater capacity, Desert Sunlight and Solar Star, are in the works in the US, both of which are already producing substantial amounts of power. Globally, China, India, Germany, France, Ukraine, Thailand and Chile also have operational plants in the 100MW+ range.

In the US, the industry has grown twenty-fold in the past six years, largely due to rapidly falling prices, which have come down by as much as 70% per installed peak watt. About half of the PV installations (which constitute 90% of all solar installed) were at utility scale, which enjoy a cost advantage. Most of the difference lies in what is called the “balance of system” cost (BOS), which is, in essence, everything but the panels themselves. Experience in Germany says that these costs should continue to come down, especially if the permitting, inspection and interconnection processes adapt a set of common rules and procedures.

Financial arrangement are another key factors. The advent of third-party ownership models, which essentially amortize the upfront costs to the consumer, has been a boon to growth. Further adaption of this model will help facilitate growth.

The biggest barrier, however, is the perceived low cost of some fossil fuel options such as coal, which is discounted heavily due to taxpayers bearing the burden of the numerous health and environmental impacts that accrue form its mining, transportation and use.

The report contains a number of other policy recommendations that can further ease the way for a solar-powered clean energy future. These include:

  • Reduce reliance on silver for electrical contacts

  • Increase R&D funding of thin-film technologies due to potential for long-term payoff

  • R&D expenditures on CSP should focus on system design elements such as solar towers and high temperature materials

  • Address inefficiencies in Federal subsidy program which often favor residential systems over utilities due the way subsidies are computed.

  • Address barriers that solar generators face in accessing the tax equity market

  • More research is required on pricing schemes that don’t put the burden of solar subsidies on the shoulders of other people on the network

  • Investments are required to control he quality of power fed back into the network from residential solar

  • Subsidies should reward generation, not investment.

  • Congress should replace tax credits with direct grants.

  • State renewable portfolio standards should be replaced by a Federal standard.

Other observations include:

  • CSP is less competitive with combined-cycle natural gas than solar PV is.

  • Levelized cost of electricity (LCOE) is not an inadequate measure for solar due to its dependency on the level of solar penetration in a given market

  • The cost of solar PV is below the cost required for grid parity in many jurisdictions that allow net metering.

  • In the wholesale market, PV displaces the alternative with the highest variable cost, which tends to be fossil fuel-based

  • Without storage, solar PV can put a burden on thermal plants

  • Further cost reductions will be required for solar to remain competitive at higher levels of penetration

  • As solar penetration increases, so will the need for storage.

  • Without government policies in place to support the large scale integration of this technology into the electrical system, solar energy is likely to supply only a small percentage of the world’s electricity needs.

Image credit: Rama: Wikimedia creative commons