Solar energy just set a world record – but probably not the one you were expecting. On 10th March Solar Impulse broke the world record for solar flight in their larger attempt to be the first pure-solar aeroplane to circumnavigate the world. The trip is designed as both a proof of concept, and as part of a wider mission to raise the profile of our most promising opportunity for renewable energy. But with the ongoing fall in oil prices, is solar energy really worth all this hype?
Solar adoption has largely been driven by three things: the high cost of traditional energy (predominantly oil, gas and coal), the growing focus on climate change and sustainability, and concerns over energy security. This led to the creation of generous government subsidies on both sides of the Atlantic to encourage adoption – as most solar power is currently uneconomical. With the worldwide fall in energy prices, critics are starting to question the value of an industry that is so dependent on government support to be profitable. Whilst a valid concern, this clearly misses the additional benefits – ‘externalities’ – the solar industry provides.
For a start, the two other factors driving adoption – sustainability and energy security – have only strengthened as oil has weakened. The situation is continuing to deteriorate in Ukraine, with the Putin regime resorting to apparent political assassination to restrain dissent at home. Whilst there is clearly some momentum gathering in the fight against Boko Haram (by a Northern African army coalition) and against ISIS (by Iraqi forces and Shia militia), their recent pledge to unite in Jihad cannot be underestimated. The US and Europe are still critically dependent on these regions for their energy needs, which has clearly visible consequences in international relations on every level. Solar power could fundamentally shuffle the global bargaining table – reducing the influence of unstable minority governments in the Middle East, and maybe even neutering Russian aggression.
Sustainability became a corporate buzzword around the turn of the millennium – scattered into political speeches and corporate strategy alike. It may have lost that initial novelty factor, but only because the green agenda has simply become part of mainstream Western society. The aforementioned subsidies were not a niche offering – they were, and generally still are, widely popular. But the questions remain as to the viability of an industry that cannot survive without state support.
Solar power comes in two forms: Photo-voltaic (PV) cells that absorb the sun’s energy and directly transform it into electricity, and Concentrated Solar Power (CSP) that use sunlight to super-heat a liquid, creating steam to drive a turbine. PV cells are more established and currently make up 90% of installed capacity. However the current generation of technologies are only around 15% efficient – effectively 85% of the energy they gather is simply wasted. This inefficiency, and the resulting limit to power generation, is the principal reason for the industry’s un-competitiveness. But this all may be about to change…
Photo-voltaic cells are currently available in two different varieties: Poly-crystalline silicon (the familiar silver panels on residential rooftops) and Thin-film (created from a whole variety of different semiconductor material types). Their respective properties have largely determined their usage. Poly-crystalline panels are significantly more expensive, but provide more juice given their higher efficiency at around 15-20%. They are generally used in more space-constrained environments, such as on your neighbour’s roof, where more power is needed from a smaller area. Thin film is cheaper due to reduced material requirements but much less efficient at around 10%, and so has tended to be used for larger buildings such as commercial warehouses. There has been steady improvement in both costs and efficiency for both, such that it is actually economical for some households in California – with a market rate of 36 cents per kilowatt / hour against costs of 30 cents.
However, improvements in traditional PV technology are actually physically limited to around 30% efficiency – something known as the Shockler-Queisser limit. This has sparked a stream of innovation with the potential to fundamentally alter the cost dynamics (and thus the business viability) of the industry.
CSP (mentioned above) is one possible solution. The physical limits relating to the extent solar energy can be taken in and transformed do not apply, as the rays are used for their heat rather than absorbed directly. This is one way of circumventing the problem with most solar cells, where energy levels that are either too low or too high are often entirely wasted. Another possibility is to layer differing types of Thin-film panels with different absorption characteristics together – enabling much greater coverage of the spectrum available.
In both cases, the maximum efficiency is forecast to be closer to 80% – a fourfold increase over the best commercial offering today. This combination of hugely increased production with the inevitable scale efficiencies as the industry expands paints a revolutionary picture of complete energy self sufficiency. Solar is the only ‘renewable’ with the potential scalability to sustainably support our ever-growing energy requirements.
Despite this, we should revisit the original criticism regarding government subsidies. These incentives are clearly crucial to promote the long-term research and investment required over the coming decades. But we are certainly right to question the extent and method of their provision. Our particularly generous support in Europe must be careful not to dilute the incentives for cost reduction that is still badly required.
Western government clearly recognize this vision for a new life without fossil fuels, but must be careful to ensure it is not stillborn by an addiction to their incentives.