MorganEnergy

A new report published by Clean Edge, a clean technology research company, suggests that solar power will be competitive with traditional sources in much of the USA by 2015. That contrasts starkly with the figures used by Frontier Economics in their recent study of the proposed Severn Barrage, which shows solar power still massively uncompetitive. So how, other than the obvious optimism of renewables advocates for their subject, does Clean Edge get to their conclusion?

One obvious factor is location. Britain is a famously rainy country. The USA, being much larger, has areas where sunshine extremely plentiful. In those areas, peak electricity demand is generally driven by the need to provide cooling. Solar generation has the useful property of being most effective at exactly the times that demand for cooling power is at its height. While solar might not be competitive with baseload prices, it is certainly competitive with the sort of peak prices that have been experienced in Texas of late.

Economies of scale is an argument that is often used in connection with solar power. The report produces impressive figures showing an acceleration in the amount of solar power being deployed, and the amount of venture capital going into the solar industry. (Google is one major company making major investments in solar technology.). This level of investment is also expected to lead to increases in the efficiency of solar cells, particularly thanks to the application of nanotechnogy.

Finally the report’s argument is based not on power supplied to the grid, but on power supplied to the home and the office, where of course it is rather more expensive. Southern California Edison is already working on a program to encourage businesses to install solar panels on their roofs. There are a lot of businesses that do nothing with their large roofs, and are keen to do something to tackle soaring energy bills. SCE believes that they can install 250 MW of solar capacity fairly quickly this way, and make their commercial customers happy into the bargain. And, as SCE’s CEO, John E. Bryson, points out in the promotional video, unlike new wind farms or other major forms of renewables, these solar panels do not need new transmission infrastructure to get the power to the customers.

It is hard to say what the predictions of people like Clean Edge will look like when we finally get to the future for which they are painting such a rosy picture, but they have provided plenty of food for thought.