Bold Prediction for Rooftop Solar in Britain: Grid Parity by 2013

rooftop solar brighton earthshipWritten by Stacy Feldman. Originally published May 14, 2009, at SolveClimate

Solar photovoltaics (PV) in the UK will be as cheap as grid-sourced fossil fuels much sooner than expected, a new study by Solarcentury finds.

For homeowners, PV will cross the “grid parity” mark in 2013. For commercial customers, it will occur around 2018. The magical parity date for PV is generally assumed to be 2020 in the UK. Says Solarcentury:

“The proximity to parity heralds the prospect of PV being a compelling investment for the individual, without subsidy, in only a few years time.”

The 14-page report by the UK’s largest solar firm is described as the most “up-to-date and accurate analysis on the investment case for PV in the UK.”

Its main point is that solar PV has precisely what it takes to move beyond a British niche and into the energy mainstream: Its energy potential is massive. It’s getting cheaper all the time. And it’s fast-approaching the holy grail of the solar sector, grid parity.

Time to tap it.

The resource potential from mounting PV on every UK building is huge, around 460 terrawatt hours (TWh) each year. That’s more than the country’s current electricity consumption of 400 TWh. Solarcentury says harnessing just a fraction of that absolute potential:

“would represent a substantial contribution to the UK energy mix and to addressing renewable energy and carbon targets”

On top of that, the price of solar PV is falling “rapidly,” while the costs of fossil fuels are rising. The long-term prognosis for the technology is more of the same, significant cost reductions. That prediction, writes Solarcentury, is “driven by the nature of the manufacturing process for crystalline silicon PV.”

Other research supports this claim. According to a recent report by New Energy Finance, polysilicon prices could fall as much as 43 percent in 2009 compared with 2008 levels.

With substitution to thin film, PV prices could drop even more. (See In a League of Its Own: First Solar Breaks the $1-a-Watt Barrier).

There’s another major factor that will surely drive down PV costs in Britain – the nation’s proposed feed-in tariff, which is expected to be implemented in April 2010. The tariff would guarantee an above-market price for commercial and residential customers selling solar power back to the grid. The plan would boost demand for solar panels and substantially cut costs in the long term.

Jeremy Leggett, executive chairman of Solarcentury, called it an absolutely “vital” measure to help accelerate consumer adoption of solar panels. It will also help the nation achieve its 2020 target to source 15 percent of its electricity from renewables, which it is struggling to meet.

“A burst of premium-pricing for solar energy, of the kind now on offer in 18 European countries, will stimulate a very fast-growing market.”

This isn’t your average energy subsidy, he explains:

“The feed-in tariff will be ramped down over a few years. This is not like nuclear, where the market has to be underwritten with public money essentially for ever.”

The PV market has been exploding in recent years, particularly in Europe, thanks in large part to generous feed-in tariffs. The world’s solar PV installations increased by 110 percent in 2008 to 5.95 GW, according to Solarbuzz’s annual report, Marketbuzz 2009.
Europe accounted for 82 percent of world demand last year.

The UK made up just a tiny fraction of that growth. It could snatch up a much bigger slice.

It’s a bet worth taking for Britain, and for any government, for the jobs potential alone. Don’t forget: Solar PV is one of the biggest job-creating industries on the planet. The striking numbers, from Solarcentury’s report:

“UNEP estimate PV job creation at 7 to 11 per MWp installed; this figure is supported by the German solar experience, where over 50,000 jobs have been created since 2000.”

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Image credit: Dominic’s pics at Flickr under a Creative Commons license

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