Solar Cost Competitive within Ten Years

bi-ker-shi

Sat Oct 20 17:02:36 -0700 2007

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Hi zogger, that reference is actually 18 months old. Old news is better than no news though!

When it comes to solar cells not including the 'thin film' variety, the floor price is limited by the cost of all that electricity needed to refine silicon to high purity. Thin films are supposed to solve this problem by using less silicon or in the case of nano solar, using alternatives to silicon.

What I have been unable to find anywhere on the NET is any intensive analysis on the micro economics of thin films. So when someone makes a statement such as the cost of solacells will drop to 50% within ten years, it's almost meaningless to me.

Twenty years ago, I was working for an economist with SSB developing a non-linear model of the world economy, running on an IBM AIX system sub-megahertz. I remember the IBM salesman predicting that it would not be long till this technology would exceed 100 megahertz. I found it hard to believe, but it happened and went a long way further.

When it comes to a whole range green technologies including thin films, bio-reactors and ultra-capacitors, the underlying science is sound, but lately there has been some bad news that seems to indicate that commercialisation is proving harder to do than it was with mico-processors. 

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zogger

Sat Oct 20 19:58:21 -0700 2007

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First, sorry about the old news, I misread it, probably would have rejected it. With that said, solar PV with conventional panels are selling as fast as they make them, so I don't know if that counts as success or not.

I will admit though, as purchasing power in the watts to dollar category goes, it was a better deal a few years ago, the explosion in cheap throw away gadgets and fast computer upgrade cycles has swamped the silicon market. In the *use* of solar, it is a better deal now than a few years ago and most likely will increase rapidly (my SWAG).

There's a sweet spot (I think we are in the middle of it,at the tippy top peak and tottering, we'll call it "the good old days") where manufacturing anything is good and profitable to some extent, as raw materials and energy sources are still "cheap enough to deal with", but new geopolitical events could up the price of most anything, once an expanded middle east war causes some serious sticker shock with petroleum. (war drums lately sounding like ginger baker on crank).

I know most electricity is made from coal now, and sources other than oil, but the energy markets are remarkably lock step in price increases, very generally speaking, and coal has gotten knocked down several pegs because of co2 issues, as we have seen lately.. Solar (and wind) are unique because the fuel is free, unlike all the other sources, which all take similar capital investment and manufactured products and infrastructure and running/deployment costs, whereas solar and wind are build once, run pretty much free (cheap and easy enough anyway) for a long time. It's hard to even compare them, two different critters there, the only other similar situation really is hydropower. So it is hard to do a forward evaluation on their actual cost right now or some ROI to the point of making money or getting free juice, other than noting that conventional sources-as your only other alternative short of living in a yurt and following the solar cycle daily- will most likely odds-on always keep going up in cost yearly. Solar and wind are also, with biofuels and smaller scale ground loop geothermal, about the only tech out there that joe sixpack can actually purchase and run and own outright when it comes to garnering the energy you want/need, and as such qualify as disruptive technologies for which no real good studies are even possible, it just hasn't been out that long in big enough sample sizes. the last time the developed nations had such a similar situation is when horse and buggys where common, people grew their own biofuel, and made candles from beef tallow from their own beef. I mean really, it was that long ago where we had such a decentralization of the common dude's energy needs.

There's looking at solar as a mega business, as an investment as a venture capitalist, and the expectations thereof, then there's looking at solar as the ultimate end user and purchaser of electricity (or concentrated heat). Two completely different markets and viewpoints.

Most homeowners just want to eventually have free juice,(and have guaranteed juice, more blackout proofing insurance, which to me is of immense value but hard to slap a dollar value on), while most big companies and middleman investors/traders need more than that, they need a "return" above and beyond just getting enough electricity to satisfy their own purposes.

As a big business trader it is most likely farther away from being a "deal" or "cost competitive" as it is for the homeowner or small business user.

Say you get a ten per cent return as a homeowner, that is still pretty spiffy considering you want to live in that home for a long long time, it'll be paid off and you'll be getting near free electricity well within a normal mortgage. that's today, right now, hard data. As a VC, 10% doesn't sound sexy enough to bother with. One case it *is* cost competitive right now, in the other it is still far away..but good enough so that guys with buckets of money will take a small sip from that glass, as we are seeing. It is the beginnings of a momentum as the smaller scale advantages are starting to look like larger scale as long as you take the longer view.. These big business analysts usually only consider that second case for the most part, that is their jobs after all, so that is their published opinion for their target demographic market.

Musta been fun getting to do those long range forecasts, I love it myself as an armchair geopolitical quarterback.

scale/markets/wildcards

Lucifer

Sat Oct 20 21:26:34 -0700 2007

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Well, the question at the heart of this is, how do subsidies figure into it?  The US government subsidizes coal/gas/etc quite a bit, or so I hear on technocrat, but they don't subsidize solar all that much, if at all.  So when we say "cost competitive", do we mean unsubsidized solar vs subsidized coal/gas/etc?  If that's the case, removing the subsidies might very well make it cost competitive today....

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David Leppik

Mon Oct 22 11:08:13 -0700 2007

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Hmmm... how are you counting subsidies? Much of the solar technology we have exists because of Department of Energy research. And if you google "solar rebate" you'll find that many (if not most) states have big subsidies on solar installations... not even counting the fact that you can often sell back the power to the electric company at retail. (How many thrift shops will give you full retail value for anything... and resell it without recouping their own costs?)

One big reason photovoltaic solar is so expensive right now is that there is more demand than supply. And that's being fueled largely by Germany which has incredible subsidies.

When you add up the unbeatable tax breaks and security services, I suspect oil still comes out ahead in terms of subsidies. Coal, on the other hand, gets far less help from the government and its price may be reasonably close to the natural costs.