The price of solar energy will be on parity with power provided off the grid much sooner that previously thought, experts in Europe and the US claimed this week.
Soaring prices for fossil fuels and falling prices for solar panels mean that the once-large gap between the prices of electricity produced from photovoltaic cells and from oil, gas and coal are closing rapidly.
Solar industry players say “grid parity” for solar power in Europe is likely within five years with the cost of electricity rising up to 20 per cent per annum in some countries. In regions where power prices are already very high and sunshine plentiful, such as California and Italy, parity has recently been reached, Suntech Europe says.
A study released in the US, meanwhile, predicts solar power will be on par with retail electricity rates in about seven years. The Utility Solar Assessment (USA) Study, by Clean Edge and Co-op America, proposes a pathway toward a goal for 10 per cent of US power to be produced from solar sources by 2025.
The USA Study says for the goal to be met requires the big power utilities to embrace solar generation, regulators to ensure tax credits are guaranteed long term for solar installation, and solar companies to develop technologies that users can hook up themselves.
The authors, Ron Pernick and Clint Wilder, say solar energy can be a significant contributor to the US’s grid power because of its ability to deliver large amounts during the hours of peak daily demand. They warn, however, that enormous investments still have to be made for solar to be cost effective on a large scale – in the order of $500 billion over the next two decades.
Germany is the world leader in solar uptake with 1.1 gigawatts of capacity installed in panels on 500,000 houses. Feed-in tariffs are paid to householders who supply excess power back the grid.
The German solar industry association says production of solar panels is expected to expand by 40 per cent in 2008. Subsequent economies of scale, ever-improving technology, and increasing supplies of silicon (used in solar panels) will see further falls in solar generation costs, experts told a Munich trade fair.
GreenBiz 17/6/08, Guardian 16/6/08
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