2016 may well be remembered as a watershed moment in the history of photovoltaic energy. For the first time in the United States grid parity has been achieved, when the cost of producing energy from renewable sources equals the cost of energy from traditional sources. In other words: investment in solar energy (other forms of renewable energy have already passed this milestone) is no longer solely an ethical issue, there are profits to be made and, consequently, jobs to be created.
“We are entering what might turn out to be a great period of growth,” in which “unimagined horizons are opening up,” claims Emanuele Francesco Pecora, an Italian from Catania who currently works as Technology manager expert in solar energy in Usa. We have asked him to give an outline of the present scenario and an indication of what the future holds for renewable energy in general and solar energy in particular.
What are the reasons that have led to grid parity being achieved?
To tell the truth, energy from renewables in the Middle East costs even less than energy from traditional sources. In any case I can identify three key reasons that have led to this achievement. The first is the technology. Much progress has been made due to the research that begun many years ago and is now beginning to bear fruit. For example, research into the use of the chemical compound cadmium telluride in the production of solar cells began in the 1970s but only recently has an effective application been found that is positive for the industry.
The second reason is the increase in installed capacity on a global level. The greater production has led to a reduction in costs. The third and final reason is linked to the second. Much of this capacity has been produced and installed in South East Asia, where industrial costs are lower. So the combination of these three factors explains grid parity.
Is the age of oil coming to an end?
People have been talking about this for some time but the transition from one epoch to another, in terms of production and consumption, will be gradual. Here in the United States, where I live and work, solar energy makes up only 1% and wind power 6%-7% so it will take some time yet. What we are seeing though is a clear change. Renewables today are not just an ethical choice, there is significant business potential and unimagined scenarios are opening up.
It’s necessary to completely rethink the electricity network, which has not changed since the time of Edison. There are the power stations, which are always active producing energy, and there’s the transmission network that transports the energy to the user. For solar energy, the field I work in, there are many large-scale plants but there’s also personal production, for example panels that any one of us could install on the roof of our house or company. So there’s the centralized element that is now accompanied by a decentralized dimension. The network needs to adapt to this: it must become bidirectional.
Then there’s the problem of continuity. Solar energy, like other renewables is not constant. It depends on the sun just like wind production is limited by the available wind. This has a very significant effect on the network. In California and Hawaii, where production from solar energy has reached 10% and 20% respectively, a significant mismatch between supply and demand has already been highlighted. The peak in production occurs in the early afternoon while consumption peaks between 5pm and 6pm when people head home to use their kitchens, switch on their computers and air conditioners and plug in their telephones to charge.
Another turning point is the situation with electric cars: there are more and more in circulation. Public transport too is shifting towards electric propulsion. We have even reached the situation here in California where some electricity companies offer economic incentives for those who charge up their electric cars at times of day that do not coincide with the return home and the peak demand. It is for these reasons that I believe the network needs a rethink.
What are the solutions?
There are many and I will try to explain just a few of them. For example, some people are directing their panels versus east. While they sacrifice the maximum radiation that comes from the south and southeast, in recompense they get to produce more energy at the time of day when they need it most and they avoid wasting the energy that is generated in the early afternoon when there is less demand for it.
Another crucial question concerns combining energy with the Internet of Things. In an ideal scenario, and one not too distant from reality, it would be possible to manage the control of energy based on climatic variations. For example, you were to know that cloud cover was about to pass over your house, the energy control system could lower the temperature of the fridge before the arrival of the cloud cover and place the device on standby as the clouds pass overhead (the prior lowering of the temperature would ensure that it remained at the right temperature in the meantime) before starting it up again afterwards. Were it to function as normal the fridge would need to consume energy from the grid when the clouds prevent solar production.
Finally, the weather forecasts need improving. It would be useful to be able to have short-term forecasts about the next few minutes. But here significant investment in artificial intelligence is needed. Work is being done on this front, however.
Does solar energy create jobs?
The annual growth rate for the sector since 2010 is 58%. In the last year over 260 thousand jobs have been created in the United States alone: more than the number of jobs lost due to the closure of the mines for example. The entry-level salary is also higher. Furthermore, it is not possible to externalize, in the sense that installation, maintenance and other processes must necessarily be performed in situ.
But isn’t shale gas the real revolution in America?
Shale gas has undoubtedly contributed to helping the US achieve energy self-sufficiency, which is a significant development as it means that the country is no longer dependent on imports. But shale gas is worthwhile when the price of oil is high because the extraction processes are expensive. Secondly, the real phenomenon that is taking shape in the background is the shift from traditional sources to renewables. In California the contribution from nuclear energy is falling; all over the country coal-fired power stations are closing down as a cycle comes to an end. A large proportion of the capacity added to the grid comes from renewables.
What effect do political decisions have on the development of solar?
In recent years two different models have been pursued. The first is that of the feed-in tariffs, the incentives for those who install solar panels for which the energy produced is sold at an advantageous rate to the national grid. In this case the result is strong and rapid growth. Once the incentives are finished, however, there is risk that the growth stalls, with obvious repercussions in terms of profits and jobs. The other model, which has been followed here in the US for example but not only here, is that of financing research and development. The state takes responsibility because private companies often lack the necessary resources, which are huge. In this way the market remains unaltered.