“…a small think tank with a knack of spotting new trends…” – Geoffrey Lean, Telegraph.co.uk.
Chapter 12. Turning to Renewable Energy: Solar Cells and Collectors
Several technologies are now used to harness the sun’s energy, including both solar thermal collectors and solar photovoltaic cells. Solar thermal collectors, widely used to heat water, are now also used for space heating. Collectors, which concentrate sunlight to boil water and produce steam-generated electricity, and assemblages of solar electric cells are both used on a commercial power plant scale, with individual plants capable of supplying thousands of homes with electricity.
Perhaps the most exciting recent development in the world solar economy is the installation of some 40 million rooftop solar water heaters in China. With 2,000 Chinese companies manufacturing rooftop solar water heaters, this relatively simple low-cost technology is not only widely used in cities, it has also leapfrogged into villages that do not yet have electricity. For as little as $200, villagers can have a rooftop solar collector installed and take their first hot shower. This technology is sweeping China like wildfire, already approaching market saturation in some communities. Even more exciting, Beijing plans to more than double the current 124 million square meters of rooftop solar collectors for heating water to 300 million by 2020. 37
The energy harnessed by these installations in China is equal to the electricity generated by 54 coal-fired power plants. Other developing countries such as India and Brazil may also soon see millions of households turning to this inexpensive water heating technology. This leapfrogging into rural areas without an electricity grid is similar to the way cell phones bypassed the traditional fixed-line grid, providing services to millions of people who would still be on waiting lists if they had relied on traditional phone lines. The great attraction of rooftop solar water heaters is that once the initial installment cost is paid, the hot water is essentially free. 38
In Europe, where energy costs are relatively high, rooftop solar water heaters are also spreading fast. In Austria, Europe’s leader, 15 percent of all households now rely on them for hot water. And, as in China, in some Austrian villages nearly all homes have rooftop collectors. Germany is also forging ahead. Janet Sawin of Worldwatch Institute notes that some 2 million Germans are now living in homes where water and space are both heated by rooftop solar systems. 39
Inspired by the rapid adoption of rooftop water and space heaters in Europe in recent years, the European Solar Thermal Industry Federation (ESTIF) has established an ambitious goal of 500 million square meters, or one square meter of rooftop collector for every European by 2020, a goal that exceeds the 0.74 square meters per person today in Israel, the world leader. Most installations are projected to be Solar-Combi systems that are engineered to heat both water and space. 40
In 2007, Europe’s solar collectors were concentrated in Germany, Austria, and Greece, with France and Spain also beginning to mobilize. Spain’s initiative was boosted by a March 2006 mandate requiring installation of collectors on all new or renovated buildings. ESTIF estimates that the European Union has a long-term potential of developing 1,200 thermal gigawatts of solar water and space heating, which means that the sun could meet most of Europe’s low-temperature heating needs. 41
The U.S. rooftop solar water heating industry has thus far concentrated on a niche market—selling and marketing 10 million square meters of water heaters for swimming pools between 1995 and 2005. Given this base, however, the industry is poised to mass-market residential solar water and space heating systems. 42
We now have the data to make some global projections. With China setting a goal of 300 million square meters of solar water heating capacity by 2020, and ESTIF’s goal of 500 million square meters by 2020, a U.S. installation of 200 million square meters by 2020 is certainly within reach given the recently adopted tax incentives. Japan, which now has 11 million square meters of rooftop solar collectors heating water but which imports almost all its fossil fuels, could easily reach 80 million square meters by 2020. If China, the United States, Japan, and the European Union achieve their goals, they will have a combined total of 1,080 million square meters of water and space heating capacity by 2020. This would come to 0.45 square meters per person for the 2.4 billion people in these countries, still well below Israel’s figure today. 43
If the developing world’s 5 billion people in 2020 have 0.1 square meter of rooftop water heating capacity per person by 2020, roughly the same as in China or Turkey today, this would add 500 million square meters to the world total, pushing it over 1.5 billion square meters. If we assume that each meter provides 0.7 thermal kilowatts of power, then we are looking at a world solar thermal capacity by 2020 of 1,100 thermal gigawatts, the equivalent of 690 coal-fired power plants. 44
The huge projected expansion in solar water and space heating in industrial countries could close some existing coal-fired power plants and reduce natural gas use, as solar water heaters replace electric and gas water heaters. In countries such as China and India, however, solar water heaters will simply reduce the need for new coal-fired power plants.
One reason for the explosive growth of solar water and space heaters in Europe and China is the economic appeal. On average, in industrial countries these systems pay for themselves from electricity savings in fewer than 10 years. 45
With the cost of rooftop heating systems declining, other countries will likely join Israel and Spain in mandating that all new buildings incorporate rooftop water and space heaters. No longer a passing fad, these rooftop appliances are fast becoming a mainstream source of energy as fossil fuel prices rise. 46
While the direct use of sunlight to heat water has dominated the harnessing of solar energy to date, the world’s fastest-growing energy source is the solar cells that convert sunlight into electricity. Installations worldwide now total 8,600 megawatts. Although solar cells are still only a minor source of electricity, their use is growing by over 40 percent annually, doubling every two years. In 2006, Germany installed 1,150 megawatts of solar cell–generating capacity, making it the first country to install over 1 gigawatt (1,000 megawatts) in a year. 47
Until recently, the production of solar cells was concentrated in Japan, Germany, and the United States, but several energetic new players have recently entered the industry, featuring companies in China, Taiwan, the Philippines, South Korea, and the United Arab Emirates. China overtook the United States in solar cell production in 2006. Taiwan may do so in 2007. Today there are scores of firms competing in the world market, driving investments in both research and manufacturing. 48
For the nearly 1.6 billion people living in communities not yet connected to an electrical grid, it is now often cheaper to install solar cells rooftop-by-rooftop than to build a central power plant and a grid to reach potential consumers. For Andean villagers, for example, who have depended on tallow-based candles for their lighting, the monthly payment for a solar cell installation over 30 months is less than the monthly outlay for candles. 49
Villagers in India who are not yet connected to a grid and who depend on kerosene lamps face a similar cost calculation. Installing a home solar electric system in India, including batteries, costs roughly $400. Such systems will power two, three, or four small appliances or lights and are widely used in homes and shops in lieu of polluting and increasingly costly kerosene lamps. In one year a kerosene lamp burns nearly 20 gallons of kerosene, which at $3 a gallon means $60 per lamp. A solar cell lighting system that replaced only two lamps would pay for itself within four years. 50
The estimated 1.5 billion kerosene lamps in use today provide only 0.5 percent of all residential lighting but account for 29 percent of residential lighting’s CO2 emissions. They use the equivalent of 1.3 million barrels of oil per day, which is equal to roughly half the oil production of Kuwait. Replacing these lamps with solar cell installations would cut world oil use by 1.5 percent and reduce annual carbon emissions by 52 million tons. 51
For industrial countries, Michael Rogol and his PHOTON consulting company estimate that by 2010 fully integrated companies that encompass all phases of solar cell manufacturing will be installing systems that produce electricity for 12¢ a kilowatt-hour in sun-drenched Spain and 18¢ a kilowatt-hour in southern Germany. Although solar cell costs will be dropping below those of conventional electricity in many locations, this will not automatically translate into a wholesale conversion to solar cells. But as one energy CEO observes, the “big bang” is under way. 52
With sales of solar cells now doubling every two years and likely to continue doing so at least until 2020, the estimated sales for 2008 of over 5,000 megawatts will climb to 320,000 megawatts in 2020. By this time the cumulative installed capacity would exceed 1 million megawatts (1,000 gigawatts). Although this projection may seem ambitious, it may in fact turn out to be conservative. For one thing, if most of the nearly 1.6 billion people who lack electricity today get it by 2020, it will likely be because they have installed solar home systems. 53
When a villager buys a solar cell system, that person is in effect buying a 25-year supply of electricity. Since there is no fuel cost and very little maintenance, it is the upfront outlay that counts, and that typically requires financing. Recognizing this, the World Bank and the U.N. Environment Programme have stepped in with programs to help local lenders set up credit systems to finance this cheap source of electricity. An initial World Bank loan has helped 50,000 home owners in Bangladesh obtain solar cell systems. A second, much larger round of funding will enable 200,000 more families to do the same. 54
Investors are also turning to large-scale solar cell power plants. A 20-megawatt facility under construction in South Korea, scheduled for completion in late 2008, is the largest in the world. It will soon be eclipsed, however, by a 40-megawatt facility being built near Leipzig, Germany, that is scheduled to start supplying electricity by 2009. In Spain, BP Solar contracted to build some 278 small generating facilities with a combined capacity of 25 megawatts. At its headquarters in Mountain View, California, Google—one of the many companies investing in solar electric cells—has installed a 1.6-megawatt array of solar cells to convert sunlight into electricity. 55
More and more countries, states, and provinces are setting solar cell installation goals. Japan, for example, is planning 4,800 megawatts of solar cell–generating capacity by 2010, a goal it will likely exceed. The state of California has set a goal of 3,000 megawatts by 2017. On the U.S. East Coast, Maryland is aiming for 1,500 megawatts of solar installations by 2022. And in China, Shanghai is shooting for 100,000 rooftop solar cell installations, though for a city with 6 million rooftops this is only a beginning. Altogether, the global Plan B economy is projected to have 1,190 gigawatts of solar cell capacity by 2020. 56
Another promising way to harness solar energy uses sunlight to heat water and produce steam to generate electricity. This solar thermal technology—often referred to as concentrated solar power—simply uses reflectors with automated tracking systems to concentrate sunlight on a closed vessel containing water or some other liquid, raising the temperature as high as 750 degrees Fahrenheit to produce steam. California installed 354 megawatts of solar thermal–generating capacity nearly 20 years ago, but with cheap fossil-fuel-fired electricity, investments in solar thermal power dried up. With fossil fuel prices and concern about climate change both climbing, there is now a resurgence of interest. A 64-megawatt solar thermal power plant completed in 2007 in Nevada, a similar one under construction in Spain, and a 300-megawatt facility proposed in Florida represent the new wave of these facilities. 57
Prominent among the regions with the solar intensity needed to profitably operate solar thermal power plants are the U.S. Southwest, North Africa, Mediterranean Europe, the Middle East, Central Asia, and the desert regions of Pakistan, northwestern India, and northern and western China. 58
The dream of using the Sahara Desert’s vast solar resources to supply electricity to Europe may soon become a reality. In June 2007 Algeria announced plans to build 6,000 megawatts of solar thermal generating capacity for export by cable to Europe. In July 2007 construction began on a 150-megawatt natural gas/solar hybrid plant, where the gas takes over entirely at night when there is no sunlight. This plant is located at Hassi R’mel, 260 miles south of Algiers, the capital. 59
Painfully aware that its oil and gas exports will not last forever, the Algerian government has created a company, New Energy Algeria, to manage the development and export of its solar energy. Its managing director, Tewfik Hasni, says “our potential in thermal solar power is four times the world’s energy consumption.” Construction of undersea cables linking the solar thermal–generating plants in the Sahara to Europe is planned for 2010–12. 60
The great attraction of solar thermal generation in sunny climates is that it peaks during the day when air conditioning needs and personal power demands are also peaking. An American Solar Energy Society (ASES) study concluded that the sun-rich southwestern United States—after excluding its less promising areas—has a potential solar power generating capacity of 7,000 gigawatts of electricity, roughly seven times current U.S. generating capacity from all sources. Assuming that the 30 percent tax credit for investment in solar generating facilities continues and that the price of carbon climbs to $35 per ton, the ASES study concluded that 80 gigawatts of this generating potential could be developed by 2030. 61
Greenpeace and ESTIA have outlined a worldwide plan to develop 600,000 megawatts of solar thermal power plant capacity by 2040. We suggest a more immediate goal of 200,000 megawatts by 2020, a goal that may well be exceeded as climate change concerns escalate. 62
37. China water heaters calculated from REN21, op. cit. note 2, p. 21; Kennedy, Jr., op. cit. note 2; Ryan Hodum, “Kunming Heats Up as China’s ‘Solar City’,” China Watch (Washington, DC: Worldwatch Institute and Global Environmental Institute, 5 June 2007); tripling of solar water heaters from Emma Graham-Harrison, “China Solar Power Firm Sees 25 Percent Growth,” Reuters, 4 October 2007.
38. Rooftop solar water heaters have a capacity of 0.7 kilowatts per square meter and a capacity factor similar to rooftop photovoltaics (22 percent); nominal capacity from European Solar Thermal Industry Federation (ESTIF), “Worldwide Capacity of Solar Thermal Energy Greatly Underestimated,” ESTIF News (10 November 2004); capacity factor from NREL, op. cit. note 9.
39. Ole Pilgaard, Solar Thermal Action Plan for Europe (Brussels, Belgium: ESTIF, 2007); Janet L. Sawin, “Solar Industry Stays Hot,” in Worldwatch Institute, op. cit. note 9, p. 38.
40. Pilgaard, op. cit. note 39; Sawin, op. cit. note 39.
41. Uwe Brechlin, “Study on Italian Solar Thermal Reveals a Surprisingly High Contribution to EU Market: 130 MWth in 2006,” press release (Brussels: ESTIF, 24 April 2007); Sawin, op. cit. note 39; Les Nelson, “Solar-Water Heating Resurgence Ahead?” Solar Today, May/June 2007, p. 28; Pilgaard, op. cit. note 39.
42. Nelson, op. cit. note 41, p. 27.
43. Japan solar heating from Sawin, op. cit. note 39; population data from U.N. Population Division, op. cit. note 23.
44. Population data from U.N. Population Division, op. cit. note 23; China calculated from REN21, Renewables 2005 Global Status Report (Washington, DC: REN21 Secretariat and Worldwatch Institute, 2006); REN21, op. cit. note 2, p. 21; Turkey from Sawin, op. cit. note 39; nominal capacity from ESTIF, op. cit. note 38.
45. Nelson, op. cit. note 41, p. 26.
46. Ibid., p. 28.
47. Solar cell installations and growth rate calculated from Worldwatch Institute, op. cit. note 4; Maycock, op. cit. note 4; Anne Kreutzmann
et al., “Exceeding Expectations: Survey Indicates more than 1 GW Installed in Germany in 2006,” PHOTON International, April 2007.
48. Travis Bradford, “23rd Annual Data Collection—Final,” PV News, vol. 26, no. 4 (April 2007), p. 9; Travis Bradford, “World Cell Production Grows 40% in 2006,” PV News, vol. 26, no. 3 (March 2007), pp. 6–8.
49. International Energy Agency (IEA), World Energy Outlook 2006 (Paris: 2006); “Power to the Poor,” The Economist, 10 February 2001, pp. 21–23.
50. “Solar Loans Light Up Rural India,” BBC News, 29 April 2007.
51. IEA, Light’s Labour’s Lost: Policies for Energy-Efficient Lighting (Paris: 2006), pp. 201–02; Kuwait oil production from DOE, EIA, International Petroleum Monthly, at www.eia.doe.gov/emeu, updated 12 October 2007.
52. Christoph Podewils, “As Cheap as Brown Coal: By 2010, a kWh of PV Electricity in Spain Will Cost Around 9¢ to Produce,” PHOTON International, April 2007.
53. Solar cell production (sales) from Worldwatch Institute, op. cit. note 4; Maycock, op. cit. note 4; people who lack electricity from IEA, op. cit. note 49.
54. Sybille de La Hamaide, “Bangladesh Seeks World Bank Loan for Solar Power,” Reuters, 26 April 2007.
55. Dana Childs, “South Korea Building Largest Solar Installation in World,” Inside Greentech, 10 May 2007; “Santander and BP Solar Partner in Major Euro Photovoltaic Project,” Green Car Congress, 24 April 2006; Google, Solar Panel Projects at www.google.com/corporate, updated 20 October 2007; “Google Sets Precedent for Clean Business Practices,” Renewable Energy Access, 23 October 2006.
56. Sawin, op. cit. note 39; Sara Parker, “Maryland Expands RPS: 1,500 MW Solar by 2022,” Renewable Energy Access, 12 April 2007.
57. “Largest Solar Thermal Plant in 16 Years Now Online,” Energy Efficiency and Renewable Energy News, 13 June 2007; Asjylyn Loder et al., “FPL Unveils Plans for a Solar Plant,” St. Petersburg Times, 27 September 2007.
58. Georg Brakmann et al., Concentrated Solar Thermal Power—Now! (Brussels: European Solar Thermal Power Industry Association, 2005).
59. “ Algeria Aims to Export Power—Solar Power,” Associated Press, 11 August 2007; “ Algeria Plans to Develop Solar Power for Export,” Reuters, 19 June 2007.
60. “Algeria Aims to Export Power—Solar Power,” op. cit. note 59.
61. Charles F. Kutscher, Tackling Climate Change in the U.S.—Potential Carbon Emissions Reductions from Energy Efficiency and Renewable Energy by 2030 (Boulder, CO: American Solar Energy Society, 2007).
62. Brakmann et al., op. cit. note 58.
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