The second factor has been subsidies from environmentally minded governments keen to spur renewable sources of energy, such as solar, and thereby reduce greenhouse gases to combat climate change, as well as boost local energy production. The European Photovoltaic Industry Association, a lobby, claims the carbon footprint of photovoltaics is up to 65 times lower than that of fossil fuel-based electricity and is continuously decreasing. “Based on current market trends, photovoltaics could meet 8 percent of the EU electricity demand in 2020 and 15 percent in 2030,” the EPIA adds.
Germany has been a pioneer of attractive “feed in” tariffs for solar energy. The country now boasts over one million PV installations, ranging from simple roof mounted panels for private homes to large central power plants mounted on commercial and industrial buildings feeding electricity into the national grid.
“Last year, some 30 gigawatts of new capacity was installed around the world. That compares with 5 GW five years ago. The total installed capacity has increased fivefold from about 20 GW to 100 GW in that period,” says Jyrki Leppänen, a solar specialist at ABB.
But while the shiny glazed surfaces of solar modules usually attract attention, there’s more to it than meets the eye. Every PV installation requires a solar inverter – a piece of electrical equipment that uses special types of semiconductors to convert the direct current generated by solar modules into the alternating current used in national power grids.
“The solar inverter is the hi-tech heart and brains of every system”, explains Mr. Leppänen, who has more than 23 years of experience in PV systems and renewable energy. “It doesn’t just convert power so it can be used safely and reliable; nowadays it does a great deal more.”
Advances in power electronics mean inverters have become more compact, more efficient, and much more sophisticated than their clunky predecessors, boosting PV installations overall. The smallest, used in most homes, are no bigger than a wall mounted water heater. Larger installations require correspondingly bigger inverters, but even the biggest – for a major PV park feeding power into a national grid – is no larger than a commercial sized container.
The growing sophistication of inverters has greatly reinforced PV’s financial competitiveness. The latest units incorporate functions performed previously by peripheral equipment, saving space, improving efficiency and cutting cost. Not only are inverters now easy to use, they include the sophisticated control, monitoring and communications functions required for the so-called “smart grid” – the electricity distribution network of the future that will provide the flexibility essential to harness renewables like solar, and give consumers much better control over their power usage. They will also offer electricity distribution companies greater capabilities to manage the grid in varying conditions. Moreover, PV power is one of the only forms of generating electricity that can be installed in cities, close to key consumers, thereby streamlining distribution.
A set of solar modules on a residential roof, for example, could be combined with high density batteries, allowing any power generated but not immediately required to be stored and used at other times – most obviously in the evenings, when domestic demand is at its peak.
Sophisticated inverters at bigger installations can be controlled and monitored remotely, boosting their efficiency and providing accurate real time information about the electricity that is being fed into the grid. And the durability of the latest systems means they can be installed in remote locations or harsh climates – such as the standalone system for an isolated community, say in northern Canada or a remote part of Africa, not linked to a national electricity grid.
Manufacturers concede demand will be volatile on a national or even regional basis, as sales will fluctuate depending on a country’s policies on feed in tariffs, which may change. But they are highly confident about the global outlook, especially as PV power generation becomes an intrinsic feature of new buildings, whether private homes or skyscraper office blocks.
“We expect the global PV market to grow steadily over time, even if there are periodic ups and downs in individual markets,” says Mr. Leppänen. “Eventually, the price of solar generated electricity will approach ‘grid parity’ (ie the cost of electricity produced from conventional sources without subsidies). Already in some locations, grid parity has been achieved at peak hours, when demand is highest and electricity dearest. Once we get near grid parity over longer periods, I predict demand will really rocket”.
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