Solar Energy: The Power of Apollo

Peter Asmus, Senior Analyst, Pike Research

By Peter Asmus, Senior Analyst, Pike Research

It was the Greeks who first viewed the sun as a source of energy that could be managed and exploited by humanity.  Early efforts to tap this energy source revolved around what are now called "passive solar designs"--methods that tap the sun's light and heat to help us see and stay warm within our homes and other buildings.

Solar power technologies received a major boost from Leonardo da Vinci in the 1500s, when he conceived a parabolic mirror that concentrated solar energy for clothing dyes.  This form of solar energy -- now referred to as "Concentrated Solar Power" (CSP)--was first developed commercially for electricity generation in the Mojave Desert in California in the 1980s.  For more than three decades, this series of parabolic troughs totaling 360 megawatts (MW) of CSP was the largest solar power generation station in the world.  While there are several CSP projects on the drawing boards throughout the world, with North Africa and Spain being two major markets, many are being canceled in California and through the western U.S. and replaced with solar photovoltaics (PV), the focus of today's solar power industry.

Modern solar PV technology was developed initially for the space program over 30 years ago and relies upon silicon transistors.  Because these solar transistors were so expensive, it took the emergence of the satellite industry in the 1950s to create a demand for such wireless electricity generators to find a cost effective application.  The space industry needed a remote power source that did not require copious quantities of stored fuel.  Solar PV panels filled a unique though specialized market niche.  Initial terrestrial applications were for remote homes and facilities not connected to any utility grid.

Today, even the conservative Institute for Electrical Energy Engineers (IEEE) now predicts that solar power will be the world's cheapest source of power over the long-term, due to its modularity and the increasing efficiency of the panels.  Future innovation should radically increase performance since efficiency can be targeted at the four-fifths of the potential solar resource that's currently lost in the power conversion process.

The Growth of Smart Solar

A typical solar PV system consists of the actual solar modules, balance of system (BOS) components, such as inverters that convert the direct current (DC) power generated by the solar module into alternating current (AC), and other system components, such as racks and wiring, or even advanced storage systems such as batteries. 

From a utility point of view, solar PV can be problematic.  Like wind, power production can be variable, though wind is less predictable. (We know, for example, that the sun does not shine at night!) The key technologies necessary to integrate solar PV into utility systems are "smart" inverters and "smart" meters, technologies that can tap intelligence within the grid network to manage the increased complexity of relying upon multiple smaller sources of power.  In this way, solar PV is part of an evolution transforming our grid from a one-way power flow from large centralized power plants to a two-way exchange that looks a lot like the Internet.

Top Solar PV Markets (Distributed and Non-Distributed), 2010 (MW). Chart by Solarbuzz. Click to view the full-size image.

Up until quite recently, solar PV has been primarily used as a distributed generation source, typically installed on customer rooftops.  In light of costs that have dropped 75 percent over the past three years, the technology is now increasingly being deployed in a centralized or utility-scale power plant, with some projects reaching 100, 250 or even 550 MW in size.

In 2010, the solar PV market grew 72 percent, illustrating the acceleration of solar PV deployment worldwide, as more than 18 GW of new solar PV capacity was added in more than 100 countries around the world. The distributed solar PV market is dominated by residential and commercial grid-connected PV systems and is concentrated in regions with favorable financial incentives, such as premium feed-in tariffs (FIT) for PV, including Germany, Spain, Italy, Japan, France, the United States (led by California), Canada (led by Ontario), and the Czech Republic.

The global leader on solar PV has been Germany, which for more than a decade has led the world in solar technology development and deployment.  In 2010, Germany installed a record 7.74 GW of solar and now accounts for roughly 50 percent of the market for solar components. Despite the fact that California receives 70 percent more potential solar power than Germany, Germany has added 28 times the amount of solar PV that California has.  All of the U.S. states (except Alaska) have better solar resources than Germany.

The recent decline in FIT rates throughout Europe is changing global market dynamics.  China has traditionally been focused on exporting low-cost solar PV products.  Now, the country is shifting its emphasis to domestic installations.  Japan -- once the global leader in solar PV manufacturing -- is also following a similar strategy in light of concerns about nuclear power in the wake of the Fukushima accident.

About the Author
Peter Asmus is a senior analyst contributing to Pike Research's renewable energy practice, with a focus on wind energy as well as emerging energy distribution models such as microgrids and virtual power plants. Asmus has 20 years of experience in energy and environmental markets, both as a writer and a research consultant.

Editor's Note: This is the third article in a weeklong series on renewable energy.

For more:
- see the pros and cons of solar power

Other Articles in the Series:
Wind: Leader of the renewable power pack  
BioPower: Lost in the Forest