EFY Times  
Thursday, October 08, 2015

Solar Power To Become Cost-Competitive
Home >> Infotech >> Trends
Solar Power To Become Cost-Competitive  
“The future of solar PV looks rather bright. The industry has consistently been able to lower the cost of solar panels.”   
Rate this news:  (0 Votes)
Monday, June 18, 2012 The future of solar power is undecided as yet. The environment-friendly quotient of generating electricity through solar power has been widely accepted but when the economic traces come in the picture, one may not agree. 'The Prospects for Cost-Competitive Solar PV Power' by Stefan Reichelstein, William R Timken, professor of Accounting at the Stanford Graduate School of Business, and Michael Yorston, graduate student in the Department of Management Science and Engineering at Stanford University, discusses the future of solar power and economic aspects associated.

Their paper breaks new ground in studying the life-cycle cost of electricity generated by solar photovoltaic, paying particular attention to key factors such as location, public subsidies, and the long-term learning effects in manufacturing solar panels.

Solar PV, Solar Power, solar panels, The Prospects for Cost-Competitive Solar PV Power,Stefan Reichelstein, William R. Timken Professor of Accounting at the Stanford Graduate School of Business, and Michael Yorston, graduate student in the Department of Management Science and Engineering at Stanford University, solar photovoltaic, natural gas, solar installations,Renewable energy, retail electricity prices,Economic Stabilization Act of 2008, federal tax, fossil-fuels, economics of solar power

Professor Reichelstein discusses the findings below:

Why did you decide to study the economics of solar photovoltaic power at this time?

Renewable energy and solar in particular remain rather controversial in the public debate about energy policy. Passions have been running high. What motivated me is the bewildering range of statements you have out there regarding the cost effectiveness of electricity based on solar PV. Given the range of opinions, I wanted to do my own analysis. I’m looking at it from the point of view of a business economist who is interested in measuring the life-cycle cost of this abundant energy source.

Your main conclusions?

Solar PV is not yet competitive with fossil fuel, like natural gas, from the perspective of a utility that can either build a new natural gas power plant or invest in solar installations.

For a commercial power user, say a business with plenty of rooftop space, the cost of generating your own electricity is now on par with what the business would need to pay in retail electricity prices. In that sense, grid parity has been achieved for commercial-scale installations. However, I need to add immediately that this is subject to two important qualifiers. The facility has to be in a favorable location, such as the Southwestern United States, and secondly the business must be able to take advantage of the current federal tax subsidies.

Concerning the future, and this may sound like a pun, the future of solar PV looks rather bright. The industry has consistently been able to lower the cost of solar panels. If this trend can be maintained for the next 10 years, and if subsidies are continued for that period, there is a real prospect for solar to become cost competitive on its own (that is, without a subsidy), at least for commercial installations. Utility-scale installations will take longer to become competitive; possibly 15 years, though it obviously becomes murkier to make projections that far into the future.

What happens if subsidies disappear or are sharply reduced?

The current federal tax subsidies come out of the Economic Stabilization Act of 2008 and will be in place until 2016 unless Congress changes the rules. The solar panel manufacturing industry has been on a remarkably steady learning curve for several decades now, which has pushed down the systems price of solar panels at a dramatic rate. However, this learning curve seems very much dependent upon production volume. So, if the tax subsidies were to cease, new production volume would probably be lower, and the effect of that would be to slow down the rate of cost improvements.

If the current preferential tax treatment is kept in place for about the next 10 years, and the observed learning curve holds up, we are projecting that, at that point in time, solar-generated electricity would be competitive with that generated from fossil-fuel power plants.

Why will it take longer for utility-scale installations to stand on their own, than for commercial-scale installations?

You have different benchmarks. For commercial-scale – and also for residential — solar, the benchmark is the retail price of electricity, while for utility-scale projects it is the wholesale price. The difference between the two is the cost of transmission, distribution, and administration; that is, everything that gets you from generating the power to delivering it to your customers.

What is driving the economics of solar power?

A mix of federal tax incentives has been especially helpful to commercial-scale installations, and even to home installations. We’ve also seen dramatic growth in recent years of utility-scale installations despite their current cost disadvantage relative to fossil fuel power plants. The reason appears to be the additional subsidy mechanisms at the state and local level. Here in California, Assembly Bill 32 (a 2006 law that set goals for reducing greenhouse gas emissions) and the state’s “renewable portfolio standard,” which requires that 33% of California's electricity come from renewable resources by 2020, seem to be driving demand. Other countries (such as Germany) have different subsidy mechanisms that yield similar effects.

Priyanka swami, EFYTIMES News Network

Print Email Post Comment 
(Total Views: 3001)

Infotech News
Clicktable.com : Cloud Based Software For Restaurants To Streamline Front Desk Operations
FDI Policy to be simplified further
Hank Summy Joins LiquidHub As Partner, Vertical Markets Lead
Square Yards To Conduct India Wide Training For Real Estate Brokers And Agents
Amazon & Flipkart sale to take place on same dates
Most popular



Kyulux Inc., Corning, Pixelligent, And More Headline OLEDs 2015 Agenda
Android 6.0 Marshmallow: 7 new features
Panasonic Upgrades Video Management Software Suites To Deliver A Full 4K End-To-End Solution
OpenShot 2.0 Open-Source Video Editor To Be Launched Soon
Flipkart gears up to make its BBDay's sale hassle-free
Asus joins the “Make in India” initiative
9 Motorola Phones That Will Get Taste Of Android 6.0
5 Reasons That Suggest Google Is Becoming New Microsoft
LG Watch Urbane 2nd Edition: The First Android Wear Smartwatch With Cellular Support
Arup Employs Highly Innovative Engineering Methodologies For Samsung's Device Solutions America Headquarters
5 things to keep in mind while buying second-hand phones
Intex plans to open fifth manufacturing unit
Praxis Media Private Limited Announces Winners Of The National Dental Achievers, 2015
Top 5 New Features In OS X El Capitan
Must know: Top 5 tech skills for you
Mindteck Chooses AuthShield Multifactor Authentication For Authentication Security


5 Things You Probably Didn't Know About Nexus 5X & 6P
Google's latest Nexus devices are manufactured by LG and Huawei....
Gmail Vs Outlook.com, Which One Is Better?
Gmail offers best features while, Outlook has most user-friendly and clean interface....
Top 5 New Features In OS X El Capitan
El Capitan is a upgrade worth having for Mac users....
9 Motorola Phones That Will Get Taste Of Android 6.0
Motorola is the first manufacturer to announce it’s plans for Marshmallow update....
5 Reasons That Suggest Google Is Becoming New Microsoft
In today's market, Google is under siege from all directions....
5 Ways Microsoft Office 2016 Can Make Your Life Easier
Microsoft Office 2016 is a comprehensive solution that is designed to make your work life easier....
5 Ways To Speed Up Your Mac
Sluggish computing experience is frustrating. Here are 5 ways to help you speed up your Macintosh computer....
5 Tips To Boost Your Home WiFi
You can get the most out of your home WiFi by using simple tricks....
5 Unique Features Of Microsoft Office 2016
Office 2016 brings tons of new features and apps to boost productivity of users....
Top 5 Heroes Of The Linux World
The world of open source is driven by key people who control it....
Top 5 Open Source Software Foundations
Open Source projects are supported and promoted by Open Source Software Foundations. ...
Top 6 Plugins And Extensions For Gmail
These Gmail extensions can boost your email productivity....
6 Hidden Design Features In Apple Products
Apple is known for paying keen attention to design aspects of Apple products. ...
5 Technologies That Tick Off Linus Torvalds
Linux creator is known for making harsh comments on technologies that don't appeal to him!...
Top 5 Open Source Storage Solutions
The right storage solution is crucial for business. Open source tools can minimize the investment cost....
  View All
Meet Pranjal Saxena, India's 21 Year Old Electronics Wizard
Milan Ondhia of EFYTimes was in a forthright conversation with the 21 year old Pranjal Saxena from New Delhi; an aspirant at the WorldSkills meet, in ...
“We Offer Managed Document Solutions To CIO And IT Decision Makers”: Canon
Manufacturing within the country will surely reduce the cost of our devices, but manufacturing can begin only if there is the desired eco-system and w...
“One Day The End User Can Open Up A Used Battery, And Use What’s Inside As Barbecue Sauce”
Of course that is not something currently possible, but what B&B Batteries does have are some secret recipes for their very specialised battery design...
We Wish To Procure All The LED Components Within India: Avni Energy
G. Gururaja, director, Avni Energy Solutions Pvt Ltd, shares his views about the expanding LED industry in the Indian market and the company's plans i...
We Have Registered 50 Per Cent Growth In The Last Two Years: Arihant Lighting
Apart from LEDs, Arihant is associated with the promotion of renewable energy in India and therefore, manufactures various energy saving products....
  View All
First Look: LG Optimus G
The phone sports a high-end display and comes powered by a powerful processor. ...
Create QR-Codes For Free
TEC-IT releases the freeware QR-Code Studio to provide a quick and convenient way of QR code creation for every application scenario....
DoT Secretary Shares Plans For Growth Of Telecom Sector
M.F. Farooqui has recently taken charge as secretary, Department of Telecom....
Hands-On: Sony Xperia Z
Xperia Z is Sony's first entrant model in the big-screen smartphone category. ...
Hands On: Videocon A30 Smartphone
Videocon, the consumer electronics company which is known for its refrigerators, washing machine and air-conditioner has unveiled its Android-based sm...
View All
IFA 2014
IFA 2014: LG Launches 34-Inches Curved Monitor
The company is yet to confirm price and availability of the device....
IFA 2014: Intel Launches First Core M Range Of Processors
This range of processors is tailor-made for 2-in-1 devices which include a tablet and a laptop....
MWC 2014: Tablet Lets People Feel Textures On Its Screen
Now feel what you see on your tablet, by way of ultrasonic waves....
MWC 2014: 4K Android Tablet Games To Kill Consoles, iPad
Tablet makers like Samsung want to beat the iPad by making 4K tabs. ...
MWC 2014: This Vodafone Backpack Helps Get Network In Disaster Situations
Two engineers of Vodafone New Zealand displayed the "mini" mobile network by Vodafone substructure in a backpack. ...
MWC 2014: Wilocity Chipset To Bring 'Lightening' Speed To Mobile Phones
Wilocity has developed a WiGig chipset for mobile phones that will bring lightning-fast wireless capability ...
MWC 2014: Samsung Introduces Octacore, Hexacore Chipsets
The Korean giant, Samsung unveiled two new octacore and hexacore chipsets at MWC 2014, in Barcelona. The company previously used Exynos 5 Octa 5410 ch...
View All
19th Consumer Electronic Imaging Fair To Be Held On ...

View All

home archives contact us advertise with us
Magazines Portals Directories Events News Verticals Educational Institute  
Electronics for You
Open Source for You
Electronics Bazaar
Electronics Annual Guide
EFY Awards
Linux & Open Source
Consumer Electronics
Science & Technology
EFY Techcenter

Educational Kits
© Copyright 2015 EFY Enterprises Pvt. Ltd.
All rights reserved. Reproduction in whole or in part in any form or medium without written permission is prohibited.
Usage of the content from the web site is subject to Terms and Conditions