Down, down, solar panel prices are going down!
When someone of the stature of Martin Green says the cost of solar PV technology will halve again by the next decade, you sit up and take notice. Even more so when he says solar will be the world’s most popular energy source by 2050.
For the University of New South Wales’ Prof. Martin Green is considered one of the world’s leading PV researchers. His department’s technological breakthroughs in silicon cell efficiency have not only given us the solar panels we know today but also put Australian PV research at the centre of world PV technology.
“The costs of solar will halve again by 2025 is my prediction,” he told a conference in Sydney on Wednesday. “We are at 60 cents per watt manufacturing now but we will get down to 30 cents per watt some time before 2025.”
Interestingly Prof. Green suggested that previous reports showing solar as contributing around 25 percent of the world’s energy look to be well short of the mark. He also adds that systems will adapt in accordance with this apparent solar fait accompli.
“What will happen now, and we are starting to see it already, is that the world’s energy systems will start to evolve to adapt to this new technology.”
Of course Prof Green’s points are in stark contrast to that of Prime Minister Abbott who, in suggesting that coal will be a standard source of energy for decades to come, seems to fly in the face of common sense.
Indeed Mr Abbott’s spruiking of coal has got to the point where he is almost sounding like a salesman for fossil fuel. Perhaps like many of his predecessors, Mr Abbott is looking towards a life after politics? Or is this a bit harsh?
Prof Green made two clear claims in his address:
- That the cost of solar PV technology will fall by 50 percent in the next ten years.
- That solar will inevitably be the energy source of the future by 2050.
It is his second point that resonates. As Giles Parkinson states in his column, the claim that solar will be the world’s most popular energy source is not new. Indeed this is backed up by research from the International Energy Agency.
Prof Green dismissed suggestions that coal will continue to be a viable energy source.
“I can’t see CCS [carbon capture and sequestration] working – there are too many issues and it is too expensive. We are talking about PV producing electricity at a lower cost than present coal, not coal plus sequestration. I can’t see that taking off.”
Cost of solar PV technology to halve in a decade? Solar the world’s most popular energy source by 2050? Who knew?
RSS - Posts
Thanks for the article Rich.
Posts like this usually beg the question:
“If solar will be half price in 10 years, then why shouldn’t I just wait 10 years and save thousands!”
And my answer is always the same:
Yes new technology is just around the corner. It always will be. And, yes solar panel prices will always be dropping. But if you are always waiting, there will never be a time when you can actually buy. Imagine if you made that argument with computers 20 years ago. You would never have owned a computer because a better, cheaper one is always 3-6 months away.
At the end of the day, here’s the rub. The payback of your solar system doesn’t matter. The price you pay for solar compared to what it might cost next year doesn’t matter. If you want to buy solar purely from an economic point of view (and you have the cash or access to credit at a reasonable interest rate e.g. home equity) then the only question that matters is this:
If you are paying cash: Will your electricity savings/earnings from solar be worth more to you that the interest you would have got from keeping the cash in the bank?
If you have to borrow money: Will your electricity savings/earnings from solar be worth more to you than the repayments on the solar loan?
That’s all you need to work out.
If the answer is yes (and it often is), then from day one you will be better off in cash terms, compared to life without solar. Waiting to get solar will actually cost you money.
If the answer is no, then do the calculation again in 12 months. Solar will be cheaper by then, trust me on that one!
(originally posted at the end of this article:)
http://www.solarquotes.com.au/blog/can-solar-panels-get-any-cheaper-hell-yeah/
Thanks Finn. Excellent food for thought.
Hi Rich,
Have you checked out the Clean Energy’s latest Guide to installing a solar PV for business in NSW?
According to there- How Much Electricity Do System Generate- chart a 100 Kw system only does 195.5 Kw h per day in Sydney.
It is co Funded by the NSW government ( Tony Abbott home town)
Thanks for the info Graham. Much appreciated.
When I was much younger, it was pretty much illegal to generate your own electricity, and to sell it to a private grid. The state owned SEC was a protected monopoly. Solar PV now gives every householder and business premises the right to generate their own electricity, one of the modern era’s great freedoms. The challenge for solar system producers now, is to develop the complete package, with storage and back-up generation to make stand-alone systems possible and viable.
Agree Colin. Totally. Storage breakthroughs though are the focus of a great deal of research. Our Finn is of the opinion that such as system is only a few years away. Watch this space for a few Q&A articles on this very subject from Oz solar movers and shakers.
“Life after politics” – in the coal industry? -who’d back that horse?
Beautiful point, eloquently stated. Thanks Ralph.
These figures seem odd – my 3kw system has averaged 12kwh/day for over four years now [i.e. over the annual seasonal cycle, and at 34deg latitude (=Sydney)] so if 3kw gives 12kwh/day then 100kw should give ~400kwh/day. These figures appear to be hyper-conservative.
What does he mean by the next decade, the rate of price decline is going to dramatically decrease is it, the price per kWh has gone down by 100 times since 1977. But big factor, the conservative years of deinvestment that resulted in the price only halving, for 19 years, due to the first tech boom, European, Obama, second tech boom, prices plummeted. Now I understand the negative, law of diminishing returns, but I think it’s a load of bull dust, economies of scale, mean the price will decline by around half every 2.5 years. We’re in virtuous circle territory here people, the lower the price, the higher the demand, flexible adhesive mounted solar cells, manganese batteries, truck mounted robot arms. That’s just installation, then there’s perovskites, quantum solar cells, thin film, concentrators, multiple layer including infra red, solar paint. As well as dozens of other angles I and y’all don’t know about, we’re almost at price parity already, with the major input energy. If it takes less energy to make a product than you get back from it, clearly that is the trigger, for an industrial revolution, whether it’s coal for steam power, that improves coal mining and transport, 1st IR. Petroleum mining that used to take 1 barrel of oil, to extract 50 barrels and AC current that dramatically reduces energy transport costs, 2nd IR, now a 3rd IR, where energy once more becomes cheap. I’d say we’re looking at an economic firestorm, self reinforcing tendency, returning us to the times of heroic engineering. If as I say the price is 1/16th in 10 years, then we will go from solar farms of 1GeW, to solar farms of 1 Quadrillion Watts, in a decade, in the non conservative years, the price halved every 2.5 years, why would economies of scale slow things down.
China and India get more ambitious every year, for a generation, they’ve been living in a near 2nd industrial revolution, they don’t think the 40 year great stagnation of the developed nations, is normal at all. The great stagnation is a statistical anomaly, usually there is boom eg., 20s, 50s, 60s, or bust 1890s, 1930s, war 1914-18, 1939-45, the mathematics can be very fast, in the positive, or negative.
Agree with Finn even on my highly optimistic projections of solar halving in price every 2.5 years, in 7.5 years, your likely to get cost recovery, so you’d still be 12.5% ahead, that’s money in the bank. By about year 4 storage costs will be down, so many people will go off grid, with mass produced lithium, or cheap manganese. With less people on the grid, prices will go up per kWh, so if you go off grid at that time more advantage, resources go up in price with higher demand, solar goes down, it’s a technological factor, not a scarcity factor. Why take the risk, with sub prime carbon energy, bankruptcy as grid under usage occurs, is possible. Those who remain, during grid under utilisation, must pay more, only the trunk lines are safe and they’re likely to be using desert solar farm energy. Price declines in carbon, cannot make up for increased per customer distribution costs, global coal, oil and gas prices down, but in Australia gas prices will more than double, then there’s currency decline, as resource prices go down, with cheaper energy.
Mass produced lithium batteries, like the gigawatt per year factory, started by Elon Musk, of Tesla and Space X, means more demand for solar panels and manganese batteries, at home to buffer the daytime input and automobile daytime output. Especially as light carbon fibre frame, aluminium body cars favour electric more than, petroleum cars, particularly with induction charging, but cheaper to charge at home.
My 4.5kw Rooftop Solar has produced a Return on Investment of 7%since installation 300 days ago. this is better than my superannuation fund. This indicates that coal fired generators are now obsolete as my situation is being replicated throughout my city. The coal plants may look to becoming electrical energy storage facilities.