Monday, October 27, 2014
"The sun could be the world's largest source of electricity by 2050, ahead of fossil fuels, wind, hydro and nuclear," according to two reports issued by IEA, the Paris based world's top energy think tank.
The two IEA technology roadmaps show how solar photovoltaic (PV) systems could generate up to 16 percent of the world's electricity by 2050, while solar thermal electricity (STE) from concentrating solar power (CSP) plants could provide an additional 11 percent.
Combined, these solar technologies could prevent the emission of more than 6 billion tonnes of carbon dioxide per year by 2050 that is more than all current energy-related carbon-dioxide emissions from the United States or almost all of the direct emissions from the transport sector worldwide today.
"The rapid cost decrease of photovoltaic modules and systems in the last few years has opened new perspectives for using solar energy as a major source of electricity in the coming years and decades," said IEA Executive Director Maria van der Hoeven.
"However, both technologies are very capital intensive: almost all expenditures are made upfront. Lowering the cost of capital is thus of primary importance for achieving the vision in these roadmaps."
The bullish reports are the latest dose of good news for the solar industry that has seen phenomenal growth. Global demand is expected to double every two years through 2022 as prices fall and the technology continues to improve.
Stressing that the two reports do not represent a forecast but a technology roadmap, Hoeven said they detail the expected technology improvement targets and the policy actions required from all stakeholders to achieve that vision by 2050.
Both roadmaps provide a vision for deployment based on updated modeling results consistent with the IEA's Energy Technology Perspectives 2014 released recently and its "high-renewables" climate-friendly scenario.
Providing guidance on key actions for policy makers for the next five years, the two reports reflect the true value of long term targets, providing permits and connection; and implementing remuneration schemes.
While credible and consistent signals from policy makers can lower deployment risks to investors and inspire confidence, where there are "confusing signals or stop-and-go policy cycles, investors end up paying more for their investment, consumers pays more for their energy, and some projects that are needed simply will not go ahead," stated Hoeven.
The two documents underline the complementary role of the two technologies PV and STE. With 137 GW of capacity installed worldwide at the end of 2013 and adding up to 100 MW each day, PV deployment so far has been much faster than that of STE, mainly thanks to massive cost reductions.
Under the scenario described in the roadmaps, most of the growth of solar electricity comes from PV until 2030. However, the picture changes afterwards.
When reaching shares between 5 percent and 15 percent of annual electricity generation, PV starts to lose value in wholesale markets.
Massive-scale STE deployment takes off at this stage thanks to CSP plants' built-in thermal storage, which allows for generation of electricity when demand peaks in late afternoon and in the evening, thus complementing PV generation.
PV has expanded globally, with China leading in maximum solar power generation followed by the United States, where solar power developers have benefited from the solar investment tax credit, which provides a 30 percent tax credit for solar systems on residential and commercial properties. The industry is pushing for it to be extended beyond 2016.
Over half of total solar power generation capacity is situated at the final consumers' place whether households, shopping malls or industries. STE expands in very sunny areas with clear skies, becoming a major opportunity for Africa, India, the Middle East and the United States.