Is the sky falling, or is that just sunshine hitting your head?
Some solar researchers are crying that we’re in for real trouble as global warming meets rising energy demand and peak production of oil. They’re also saying that, if we paid attention, we’d see what is really falling to Earth is a tremendous solar resource that, if harnessed, could serve most of the world’s transportation and electricity needs.
But vital questions remain, even as $140-a-barrel oil makes the answers more attractive. Who pays for the stiff startup costs? Is the technology feasible on a large scale? Should all our eggs go in the solar basket? How much land must we turn over for solar arrays? Should big companies continue to power the nation, or should every householder run a generator on his or her roof?
Two grand plans discussed in the previous installment of this story call for different methods of storing solar-produced energy, which would allow the juice to keep flowing even when the sun isn’t shining. One method — compressed air — has been used for years for natural gas storage. The other — thermal storage of energy generated from concentrated solar power plants — is in limited use and planned for in future plants, but its cost remains a concern.
Nice Idea, Awfully Expensive
In fact, questions about the competitiveness of both plans lie at the heart of the discussion. While photovoltaic solar cells and concentrated solar storage are both clean and technically feasible, if less efficient than partisans would like, can they generate reliable power at a cost similar to or less than conventional means?
The 2008 aggregate retail cost of electricity (including residential, commercial and industrial) cited on the U.S. Energy Information Administration Web site is about 9 cents per kilowatt-hour.
The authors of “A Solar Grand Plan” write in the March/April 2008 issue of EnergyBiz magazine (see “Here Comes the Sun”) that a 30-year analysis shows “intermittent” solar on a utility scale and without subsidies would cost about 15 cents per kilowatt-hour.
In their plan, which continues to evolve, they estimate that the cost of electricity produced by photovoltaic farms with compressed air storage and concentrated solar power plants with thermal storage (both of which would move solar from intermittent to continuous sources) would drop the price to about 10 cents per kilowatt-hour by 2050.
All of this is contingent on an aggressive $420 billion subsidy program for the first 10 years of the plan, giving viable solar companies the opportunity to reach optimal manufacturing and economies of scale.
Compare that average subsidy of $42 billion a year to U.S. coal, oil and gas industries, which received $50 billion in federal support in 2006, according to Earth Track founder Doug Koplow, who has studied federal subsidies for more than two decades. The nuclear power industry received about $9 billion a year.
Economist James Mason, an author of the Solar Grand Plan, says he believes the best way to fund the plan would not be the carbon tax-and-trade system in use in Europe but a flat half-cent-per-kilowatt-hour tax for fossil-fuel-generated power, which would amount to $5 for a typical 1,000-kilowatt-hour monthly residential bill.
With the subsidies, Mason believes 10 or 12 companies would emerge that could become self-sustaining and independent of government assistance. The high-voltage direct current (HVDC) transmission facilities to accompany the solar plans would be financed through bonds; customers in turn would pay higher transmission rates on their electric bills.
Denis Hayes, who organized the first Earth Day event and ran the National Renewable Energy Laboratory during the Carter administration, was among the first in the country to tout the need for government subsidies for solar energy. He has said that if Carter had been re-elected and a federal procurement program for solar systems had been implemented, solar energy would have reached its current cost by the end of Carter’s second term in 1984 and presumably would have gotten cheaper in real terms since.
But even without Carter’s embrace, various government incentives have been used over the past few decades to encourage renewable development.
For example, federal support of wind generation in recent years has shown results: U.S. wind generation increased by 46 percent in 2007, making the American wind industry the fastest growing in the world for the third straight year. The Department of Energy recently signed an agreement with wind energy leaders that aims to boost wind generation to 20 percent of national electrical use by 2030. An estimated 20 gigawatts of wind power currently are in development.
The Solar Grand Plan calls for use of wind and other renewables. In EnergyBiz, the authors wrote that an important part of their plan is to “max out” other renewables, including wind, geothermal processes, biomass and so-called “distributed photovoltaics.”
However, they give wind and other emerging renewables a much smaller role to play; for instance, by 2100, wind would supply 1 terawatt of power, while solar would supply about 14 terawatts. To produce that power, a whopping 165,000 square miles — slightly larger than all of California — would be needed for solar installations. The authors don’t expect to get there all at once — by 2050, they hope to see 19 percent of land suitable for such use, about 30,000 square miles, generating 3,000 gigawatts.
Europe’s Desertec initiative, advanced by the Trans-Mediterranean Renewable Energy Cooperation, gives wind a larger role to play in a system of solar arrays and power plants, with geothermal, wind and biomass installations also spread over several European, Middle Eastern and North African countries. The majority of the solar resource would come from 200-megawatt concentrating solar plants in the Sahara Desert. The initiative calls for Middle Eastern and North African countries to export 100 gigawatts of solar to Europe through HVDC lines by 2050.
Germany and Spain already aggressively spur development of renewables.
After implementing net metering in 1990 (allowing consumers to sell their excess power back to a utility) and experimenting with no-cost loans to residents, Germany established a “feed-in tariff” in 2000 that requires utilities to purchase solar-produced energy for the equivalent of 60 cents per kilowatt-hour, guaranteed for a 20-year period. The feed-in tariff, which was increased recently, helps property owners recoup the still stiff costs of solar installations by paying well above market rates for power.
The subsidy has propelled cloud-bedecked Germany to No. 2 in the world for solar production (behind Japan) with 1,260 megawatts of solar-produced energy last year. Spain and Morocco also have feed-in tariffs, and it is likely other nations involved in the Desertec plan will follow.
It Worked in Rehearsal
Will the technology pan out even with subsidies? Traditional silicon-cell photovoltaic production has been hit by a shortage of silicon. And while the Solar Grand Plan calls for thin-film photovoltaic cells, not the currently more efficient silicon cells, other problems could interfere with large-scale production of the cells.
Nine U.S. concentrating plants have been generating 354 megawatts of electricity during the daylight hours for several years. The first commercial concentrating solar plant with thermal storage is being built in Spain and will use molten salt to store heat for seven hours.
Recently, an American company, Ausra Inc., developed a prototype for a concentrating solar/thermal storage system that uses water rather than molten salt as thermal reservoirs; the company projects generation costs with this system will be about 10 cents per kilowatt-hour and expects the price will drop further. In a recent paper, David Mills, chairman of the company, estimated that Ausra’s 177-megawatt plant would produce power at prices comparable to coal-fired plants when his plants reach the 500-megawatt-to-1-gigawatt scale.
However, both Ausra and authors of the Solar Grand Plan agree that the solar energy must be held for 16 hours to provide consistent power. In addition to its less-than-optimal heat storage, the plant being built in Spain uses a costly two-tank system that requires heat exchangers. Mason notes that a one-tank technology, somewhat cheaper because heat exchangers aren’t required, will be needed to get the costs of storage down to conform to his projections.
Another question is the cost associated with the HVDC lines. Paul McCoy and Jerry Vaninetti of Trans-Elect Development Company write in the March/April 2008 edition of EnergyBiz (see “It’s Doable”) that the solar plan’s vision of HVDC lines spoking from a hub in the Southwestern desert to alternating current terminals throughout the country is “doable” but still more visionary than practical.
At today’s prices, the lines would cost $1.3 trillion to move the kind of electricity that would be generated, or $20 per megawatt-hour, three to four times more than what is currently paid. The authors note that China is building a 5-gigawatt line that should spur manufacturing and reduce prices.
McCoy and Vaninetti write that advances in the technology — including underground installation — and economy of scale “are sure to come” and the cost of HVDC lines will fall with increased installation and American manufacturing of the cable.
Is Small Beautiful?
Others in the power industry have reservations. In the same issue of EnergyBiz (see “The Role of Solar”), Jeffry Sterba, president and CEO of PNM Resources and chairman of the Edison Electric Institute and the Electric Power Research Institute, writes: “I don’t know anything in the energy business that has a one-size-fits-all solution, and electric generation in a carbon-constrained world is no exception.”
He writes that the authors of the Solar Grand Plan base their projections on thin-film cells, which haven’t shown long-term durability, and notes that the cost of silicon cells may drop faster than that of their thin-film cousins.
He also questions the projected costs of the solar installations, given rising costs of raw materials, and he suspects that storage costs will be much higher. He suggests that the photovoltaic installation rate on residential and commercial buildings will increase as prices fall and that the author’s estimate of 10 percent distributed solar in such a plan may be low.
Other concerns are the price of land for the installations (authors note that much of the land they are looking at is state and federally owned), as well as grid reliability and security.
Some of Sterba’s criticisms reflect the large vs. small debate in the community. For years, photovoltaic advocates have been promoting a vision of a solar array on every rooftop, with every man and woman their own mini Reddy Kilowatt. Germany’s burst in solar generation has been engineered through such a distributed system. Distribution also removes the need to set aside a California-size swath of land for solar arrays.
However, a typical 2.5-kilowatt system for a residential building in this country often costs about $20,000 and, even with tax breaks and other incentives, can take up to 10 years to pay for itself. Business and commercial entities have been more willing to invest in photovoltaic systems than have individuals, but distributed solar power accounts for less than 1 percent of U.S. energy generation; wind accounts for about 1.7 percent.
Concentrated solar is more of a natural fit as an industrial supplier, with the storage option adding to its potential. It also, to date, is the most cost-effective method of generating solar power, with efficiencies of up to 70 percent projected with storage.
Earth Day founder Hayes told Miller-McCune.com that he rejects the large vs. small debate. “It’s not an either/or” debate, he said via e-mail, adding “there is more than enough room for both solar approaches as we try to wean ourselves quickly off power sources based on fossil or fissile fuels.”
He wrote that transmission costs and losses in transmitting power from Arizona to the rest of the country are problematic, noting “10 kilowatts on your roof has lots of advantages over 10 kilowatts in Arizona.” Hayes added that even without storage, distributed systems make sense for peak power needs (displacing the most expensive power on the grid) and that storage options, such as ultra-capacitors, batteries and flywheels, may soon be able to provide “power-dense storage” for rooftop systems — “especially if linked to plug-in hybrids as back-up storage units.”
Solar panels on the roof and south wall “will never completely power the Empire State Building,” he acknowledged, and “to power the whole society from the sun will require more area than is on our south-sloped roofs. It makes sense to get much of that power from solar parks in very sunny (i.e., desert) areas.”
How much and how soon the world’s deserts become hotbeds of solar technology remains to be seen. What is more likely is that, given the same or better breaks historically awarded other energy suppliers, solar and other renewables will become more and more affordable — especially as oil nears $150 a barrel and the definition of “affordable” shifts like the desert sands.
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