In the mid 2000s, solar power was renewable energy’s Cinderella. Dismissed as too expensive to make a significant contribution to power, especially in cloudier countries like the UK, solar seemed consigned to a limited role in low carbon energy production. But just a few years later, a once-overlooked technology looks set for a significant expansion in this country and worldwide.
Six years ago, the Intergovernmental Panel on Climate Change identified solar power as the most expensive of all renewable energy technologies, estimating it cost twice as much generate a unit of electricity from a solar panel as from a wind turbine.
But the cost of solar panels and batteries has plunged by more than half in the last five years. Financial services company UBS says in Germany, Italy and Spain, solar power soon won’t need government subsidies to be economically viable. In these three countries, every family home should be equipped with solar panels by the end of the decade, it argues.
Source: BSW 2012, cited in UBS, 2013.
The role of China
One decision had a significant part to play in the drop in solar costs: a few years ago, China’s government opted to subsidise its manufacturing sector to produce cheap solar panels.
The aftermath has been mixed for the European solar industry. On one hand, cheap panels made expansion easier. But the imported panels also undercut Europe’s manufacturing sector. In Germany, for example, this led to companies going out of business and significant job cuts.
A serious dispute between China and the European Commission, which claimed the subsidies are illegal under international trade rules, ensued. The argument was only resolved last month – and the threat of trade sanctions only just averted.
Solar in the UK
In the UK, solar’s fortunes have fluctuated over the last few years. The government introduced direct subsidies for householders installing renewable generation, called feed-in tariffs, in 2010. This led to a big increase in the number of householders wanting to instal solar panels on their roofs – and risked blowing the scheme’s budget.
The government cut the subsidies down as a result, prompting an outcry from solar companies, who feared their industry would be destroyed.
The government boasts the cost of solar panels has fallen by half in just two years, and rooftop installations of solar panels have increased from a few thousand three years ago to over 420,000 now.
Ray Noble, from the Solar Trade Association (STA), tells Carbon Brief:
“Two and half years ago the [UK] government didn’t really believe in solar. Then they made the token gesture of Feed in Tariffs and saw the growth and reduction in price, and started to realise what it could do”.
Environment minister, Greg Barker, is now championing the industry. He argues it could grow from 2.7 gigawatts (GW) now to 20GW by 2020. And the government intends to publish a dedicated solar strategy – though delays mean it looks unlikely to appear before the end of the year.
Solar farms and the wicked stepmother
Despite the delay, the solar industry seems optimistic about future growth in the UK. Insiders are skeptical that the industry could grow to 20GW by 2020, but in contrast, the lower end of the government’s ambition – 7GW by 2020 – is “definitely” too low, says Noble.
It’s not clear how much of the planned expansion will be from smaller-scale installations like domestic or commercial rooftops, and how much from large-scale solar farms in fields around the country. But large-scale solar could be on the up: Noble suggests that if the country did hit the 20GW target it would mean the number of solar farms expanding from 65 now to 600 in 2020.
One potential barrier to larger installations is public opposition, however. Polls show high levels of public support for solar – even when it’s located near their home. But according to the Financial Times, “pockets of protest” are starting to emerge against large solar farms.
A rush of new applications for large-scale sites, as developers hurry to get in before a subsidy cut next March, may be partly to blame. Noble says siting has been a problem:
“Some of the developers have been lazy and haven’t picked the sites in the way they were advised to â?¦ they picked hillsides, sites alongside main roads and sites near houses â?¦ which is absolutely silly.”
In response, STA has produced a 10-point best practice document for solar farms, and is developing guidance for planners on when to give permission to the new developments. The farms should only be allowed if they are on brownfield sites and well screened so they don’t disturb the landscape, it says.
Landing the prince
On a global scale, the solar industry is still relatively small – generating less than half a per cent of the world’s electricity in 2012. But it’s still expanding and it’s getting cheaper. Around the world, solar power has increased by a factor of ten in the past five years. And it has potential to expand even more: In 2011, the International Energy Agency estimated solar power could potentially generate eleven per cent of the world’s electricity by the middle of the century.
Former government Chief Scientist, David King and economist Richard Layard recently called for a global effort – with the same level of ambition and international coordination as the Apollo mission in the 1960s – to be launched. The aim: to make solar power cheaper than fossil fuels all over the world.
You can’t fault the ambition, though it would be a huge undertaking – and any significant expansion of the industry would probably face big challenges. But overall, solar power’s potential to dance at the ball and land the prince – well, achieve a significant presence on the grid anyway – looks pretty good at the moment.