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Photovoltaic panels are plummeting in price and can power your home for a generation. Are we at the dawn of the solar age?
It’s time to stop thinking of solar energy as a boutique source of power, says Joshua Pearce.
Sure, solar only generates about 1 percent of the electricity in the US. But that will change in a few years, says Pearce, an associate professor of electrical engineering and materials science at Michigan Tech. The ultimate in renewable energy is about to go mainstream.
It’s a matter of economics. A new analysis by Pearce and his colleagues at Queen’s University in Kingston, Ontario, published in the journal Renewable and Sustainable Energy Reviews, shows that solar photovoltaic systems are nearing the tipping point. In other words, they can make electricity that’s as cheap as what consumers pay their utilities—sometimes cheaper.
Here’s why. First, the price of solar panels has plummeted. “Since 2009, the cost has dropped 70 percent,” says Pearce. Secondly, the assumptions used in previous studies have not given solar an even break.
“Historically, when comparing the economics of solar and conventional energy, people have been very conservative,” says Pearce.
To figure out the true cost of photovoltaic energy, analysts need to consider several variables, including the cost to install and maintain the system, finance charges, how long the system lasts, and how much electricity it generates. Pearce and his colleagues performed an exhaustive review of the previous studies and concluded that the values given those variables were out of whack.
For example, most analyses assume that the productivity of solar panels will drop at an annual rate of 1 percent or more, a huge overestimation, according to Pearce. “If you buy a top-of-the-line solar panel, it’s much less, between 0.1 and 0.2 percent.”
In addition, “The price of solar equipment has been dropping, so you’d think that the older papers would have higher cost estimates,” Pearce says. “That’s not necessarily the case.”
Equipment costs are determined based on dollars per watt of electricity produced. One 2010 study estimated the cost per watt at $7.61, while a 2003 study set the amount at $4.16. The true cost in 2011, says Pearce, is under $1 per watt for solar panels purchased in bulk on the global market, though system and installation costs vary widely. In some places, solar is already cheaper than power from conventional sources, and the study predicts that it will become increasingly attractive throughout the world.
In regions with a burgeoning solar industry, often due to favorable government policies, there are lots of solar panel installers, which heats up the market.
“Elsewhere, installation costs have been high because contractors will do just one job a month,” says Pearce. Increasing demand and competition would drop installation costs. “If you had ten installers in Upper Michigan and enough work to keep them busy, the price would drop considerably.”
Furthermore, economic studies don’t generally taken into account solar energy’s intangible benefits, including reduced pollution and carbon emissions. And while silicon-based solar panels do rely on a nonrenewable resource—sand—they are no threat to the world’s beaches. It only takes about a sandwich baggie of sand to make a roof’s worth of thin-film photovoltaic cells, Pearce says.
Based on the study, and on the fact that the cost of conventional power continues to creep upward, Pearce believes that solar energy will soon be a major player in the energy game. “It’s just a matter of time before market economics catches up with it,” he says.
For Pearce, solar power isn’t simply a matter of money. He was drawn to the field as an undergraduate at Pennsylvania State University, when he took an engineering science class from solar energy pioneer Christopher Wronski. “He asked what we wanted to do after we graduated, and I said ‘solar,’” Pearce recalls. “He said, ‘See me after class.’”
Back then, “I wanted to do something good for the world tackling our most pressing problems,” Pearce says, and solar was just the ticket. Throughout graduate school and his academic career, he has immersed himself in the technology, economics, and politics of photovoltaic energy.
“I actually believe in this stuff,” he says. “You have a device that, worst case scenario, pays for itself in five years in terms of the energy needed to produce it, or in under a year in the best case scenario. It lasts thirty years or more. It’s made out of abundant, easily accessible materials. And its fuel source is free.
“Who wouldn’t want that?”