5 May 2015 in the National Press Club in Washington, DC The National Press Club in Washington, DC MIT team unveiled “The Future of Solar Energy The latest edition of 7 multidisciplinary MIT reports which examine the role that different energy sources may be able to play in meeting the energy needs in the coming climate-friendly future.
The generation of solar electricity is among the most low-carbon energy sources that have the potential to expand at a massive scale. In recent years, we have witnessed the rapid growth of installed solar generating capacity, significant advancements in technology, cost, and performance, and the creation of innovative commercial models, which have led to investments in solar panels for residential use. However, further advancements are required to allow exponential growth in solar power at a cost acceptable to the public.
The Future of Solar Energy study resulted in the report team of over 30 experts examining the possibility of expanding the solar generation capacity to multi-terawatt levels in the middle of the century. They discussed the current situation of US solar electricity generation, the various techniques being developed in converting sunlight into electricity, and the environment of policy and market that the solar power industry has encountered. The study aimed to analyze solar energy’s present and potential competitiveness and identify possible changes to US policies to be more efficient and effective in facilitating the industry’s long-term, robust expansion.
The study’s findings are published within the 350 pages of the Future of Solar Energy report and five other related publications. The article below provides an overview and suggestions to policymakers and is copied from the study.
Summary for policymakers
A massive increase in solar power globally by the midcentury is likely a crucial component of any effective strategy to combat the effects of climate change. The solar power source exceeds the projected and current energy demand. Recently solar prices have dropped significantly, and the installed capacity has risen quickly. However, solar power accounts for just 1 percent of US worldwide electricity production. If a significant price is not placed on carbon dioxide emissions, growing solar power to levels appropriate to the climate change challenge is only feasible at an acceptable cost with substantial adjustments to the government’s policies.
The primary purpose of the US solar policy is to establish the basis for a massive expansion of solar energy generation over the next couple of years.
Our research examines three obstacles to achieving this goal:
- Creating new solar technology.
- Integrating solar energy in ample quantities into the existing electric system.
- Establishing effective policies that support the deployment of solar technology.
Consider a long-term perspective for the development of technology.
Photovoltaic (PV) facilities comprise the most significant solar electricity production in the US and worldwide. The predominant PV technology, utilized in approximately 90% of the used PV power, is crystalline wafer silicon. It is a mature technology backed by a rapidly growing global industry with the potential and motivation to continue seeking advancements in performance and cost. For instance, in the United States, non-module or balance-of-system (BOS) costs comprise approximately 65% of the cost of utility-scale PV systems and 85 percent of the price of a typical rooftop unit. Thus, federal R&D assistance should be focused on fundamental research into new technologies promising for cutting down on the module and BOS costs.
The PV R&D program should be focused on developing new technologies and not – as was the norm in recent years–on short-term reductions in the price of crystalline silicon.
The current commercial thin-film technologies that account for around 10 percent of the PV market have a lot of scaling-up challenges due to their dependence on a limited number of elements. Certain emerging thin-film technologies utilize earth-abundant materials and are promising, lightweight, and flexible. Studies to overcome their current shortcomings in performance, stability, and manufacturing capabilities could lead to lower BOS costs and lower module costs.
Federal PV R&D should focus on eco-friendly, efficient thin-film techniques that use earth-friendly materials.
Another important solar generation technology includes concentrated solar power (CSP) or solar thermal generation. Guarantees for loans in commercial-scale CSP projects have been a critical source of federal assistance for CSP, even though CSP isn’t as mature as PV. Due to the high risk associated with commercial-scale projects, this method does not encourage the development of innovative designs and materials.
Federal CSP R&D efforts should concentrate on developing new materials and designs for systems and develop a plan to test them in the form of pilot-scale facilities similar to those found within the industry of chemicals.
Be prepared for much higher penetration of solar power generation.
CSP facilities can conserve thermal energy for a long time and produce power that can be dispatched. However, CSP is not ideal for areas with no frequent clouds or haze and is more expensive than PV. PV will remain for a while to be the primary source of solar energy within the United States. In highly competitive wholesale electricity markets, the value of PV output decreases when PV penetration rises. That means that PV costs need to fall for any new PV investment to be considered economically. The output of PV also fluctuates in time, and a portion of this variation is not predictable. Flexible fossil generators such as demand management, CSP and hydroelectric facilities, and pumped storage can assist in overcoming these aspects of solar production. However, they need to be more sufficient when PV is the majority of all generations.
R&D focused on creating scalable, affordable energy storage systems is an essential part of a plan to realize the most economical PV deployment on a vast scale.
Since distribution network costs are usually recovered via per-kilowatt-hour (kWh) costs for the electricity used by distributed PV, the owners of the generation can shift a portion of network costs, such as the additional cost of accommodating the large amount of PV and the other users of their network. The cost shifts help to fund distributed PV but also raise issues of fairness and can cause resistance to the expansion of PV.
Pricing systems have to be designed and put into place to allocate costs for distribution networks to the ones who create them and are considered to be fair.
Establish efficient subsidies for solar deployment.
The support for the new solar technologies helps build the basis for significant expansion by gaining experience in production and deployment and breaking down the institutional hurdles. However, federal subsidies are expected to drop sharply following the year 2016.
Drastic reductions in federal funding for solar technology development are not a good idea.
On the other hand, even though continued support is necessary, the current federal, state, and local solar subsidy system could be more efficient. The majority of the tax credits for investment, which is the most critical federal subsidy, get used up through the transaction cost. Additionally, the donation per installed watt is more significant in areas where solar prices are more important (e.g., within the housing sector), and the subsidies per kWh of energy generation are higher when the solar resources are more scarce.
Policies encouraging solar development should reward the generators, not investors; they should not give more subsidies for residential generators than utility-scale generators. They should also be avoided the utilization of tax credits.
State renewable portfolio standard (RPS) programs provide essential support for solar generation. But, differences from state to state and limitations on the location of solar panels result in lower production per dollar of subsidies than a national uniform program could generate.
State RPS programs must be replaced by a unified national program that is uniform across the nation. If this isn’t possible, states should eliminate the limitations on outside-state installation of eligible solar energy.