Bitterfeld-Wolfen, Germany [Renewable Energy World Magazine] Though a lot of tasks still lie ahead, the photovoltaics industry has come a long way in recent years. And even though the arguments in favour of a major role for PV in European electricity supply are well worn, Anton Milner explains why it is important to keep on repeating this message.While those of us in the solar industry may find it somewhat tiresome to keep repeating all the good and absolutely sound arguments that reveal why solar PV has to become a major source of European electricity supply – to combat climate change, aid energy security and independence and bring all the opportunities of a growth industry concerning jobs and value creation – we still have to keep on. There are still too many politicians and decision-makers out there who, in their short-term way of thinking, have yet to grasp the full extent of what we, as the photovoltaic industry, are actually doing.
Sometimes I think that even a large segment of the photovoltaic community itself has not fully understood what is at stake here. So often we are still talking only about perhaps a cent more or less in a feed-in-tariff, when actually we should be thinking about how to change the whole system of electricity production and distribution in Europe – because that is what we have to do, and ultimately what we will do.
Why is that? Last year the European Photovoltaic Industry Association (EPIA) set out a new goal for the industry to reach a 12% share for PV in EU electricity production by 2020. That means that we have to install approximately 350 GWp of additional capacity by then – the equivalent of about 200 large nuclear power plants. That goal has already raised a few eyebrows, both inside and outside the industry, but if PV is to become a major source of European electricity supply, then there is no other way.
Of course such a target cannot be reached simply by carrying on with the ‘business as usual’ approach. As impressive as industry growth rates, cost reduction efforts and technological advances have been, we still need to shift into a higher gear to reach those ambitious goals. The first thing we have to do – and this cannot come as any kind of surprise for anyone concerned – is to reduce the cost of PV. This is because the basis of all future plans for growth is the accessibility of European electricity markets. And these markets are only accessible when it becomes economically advantageous to use PV-generated electricity instead of power bought from central generation utilities using conventional thermal technology. Reaching that most important condition, grid parity, answers on a fundamental level why PV should become a major source of European electricity supply – because it makes it cheaper.
Some may consider it cynical, but let’s be realistic: we can talk about climate change and future generations as much as we like, in the end it is the money that counts. That is a shame, but eventually will play into the hands of the industry, where 60%–90% of Europe’s electricity markets will be accessible to PV by 2020.
As electricity prices continue to rise and the costs of PV production fall, one market after another will enter the realm of grid parity. Everyone in the industry knows what we have to do to reach this. We have to expand capacities to reach economies of scale, we have to optimize production processes and to invest in research and development to make our products ever better. And, we have to do that along the whole value chain. There is neither the time nor the need to continue the ‘blame game’ witnessed over recent years, when everyone was apparently pointing the finger at someone else for keeping prices high – usually at their own suppliers. No matter whether it is silicon, wafers, cells, modules or balance of system costs – there is enough scope left for cost reduction. That is true for thin-film technology as well.
However, that is only part of the answer to the complex question of how photovoltaic technologies are to become a major source of European electricity supply.
Once markets expand because they are economically viable, rather than because they are politically supported, growth rates will be enormous. Besides the need for a rapid expansion of production facilities – which the PV industry will surely be able to meet – this means a lot more. First of all, we have to think differently.
So far, the industry has been chiefly concerned with producing cells and modules, talking about technological details, about yield and other production-related issues. Many will still do that, and it will remain as necessary as it has always been, just as in any other high-technology industry. But from now on we have to talk about the system of electricity generation and supply, and we have to show that it is the PV industry which can and will shape it.
It has been part of the pioneering spirit of the early PV days to claim that the decentralized use of solar energy will revolutionize the energy system. So far, no one has been able to prove any such claim. Due to the very low share that PV still contributes to electricity production, the incumbents, and the larger parts of the more or less interested public, have seen PV as a niche player – maybe a little bit annoying to the established companies, but essentially harmless.
Meanwhile, the utilities have stopped tilting at windmills and started to buy and build them. Most of them still do not seem to take PV seriously, all their political bickering notwithstanding. Yet with every step towards our ambitious targets – and towards grid parity as the cornerstone of this development – this is bound to change. For the industry this means throwing overboard all the remaining – and often justified – mistrust of, and reservations towards the utilities. Instead it means trying to see them as what they are: future partners.
Of course, we will have to press for a regulatory framework that not everyone in the energy business will like, like truly liberalized markets; but a lot of the technical and regulatory innovations required will also have positive effects for all those involved – for instance smart grids or smart metering. We have to build on that in the future.
With every percentage point that we raise PV’s share of the electricity supply, the responsibility to think about the system of energy supply as a whole grows. This involves ongoing issues such as reduction of costs, but also forces us to help to find solutions for issues such as storage or grid integration, if we want to be taken seriously.
If we do that, we deal with topics that are not only interesting for PV, but for all renewable energy technologies. Thus it is time to rediscover the notion that we belong together. Sometimes one gets the impression that the different technology sectors fight for themselves, and inevitably opponents to renewables try to adopt a divide et impera [divide and rule] strategy. Any division would of course be fatal, and unity becomes more and more important.
What we need are common R&D and especially demonstration projects to show how a system of electricity supply based on renewables can work. Virtual power plants, storage systems and smart grids are the main keywords here. PV, being a peak load energy resource by nature, has a very special and valuable part to play in this concert of renewable energies, and the system has to be tailored to bring its specific strengths to the fore. There is no all-embracing plan as yet, but elements such as time-of-day billing and intelligent load management come quickly to mind.
Last but not least, we need a Europe-wide public awareness that PV is a major part of the solution to all the problems our current system of energy supply and consumption produces.
It may be quite popular in Germany, and may seen as more and more important along the Mediterranean coast, but we still have to convince a lot of Europeans, especially decision-makers, that PV will be a major energy source of the future. That means working closely with governments and administration at all levels to do grass-roots information work. This might mean that we have to tell the story again and again, but it is worth it. The arguments are good and remain so.
Anton Milner is founder and chief executive officer of Q-Cells AG.