February 02, 2009
How Government Killed Solar
It looks like the solar bubble is about to burst.
Bringing an end to eight consecutive years of growth, global revenue for photovoltaic (PV) panels is expected to drop by nearly 20 per cent in 2009, as a massive oversupply causes prices to decline.Now here is where the story gets good.
"Supply and demand were already unbalanced in 2008 with 100 per cent more modules produced than installed," said Dr. Henning Wicht, senior director and principal analyst, photovoltaics for iSuppli. "The short-term boost in demand from Spain and Germany kept installation companies busy and solar orders and module prices high. But this boom is over. In 2009, average prices for panels for new installation contracts will collapse to the $2.50 to $2.75 per watt range by the end of 2009, down from the current level of $4.20 per watt. The average price for the year will be $3.10 per watt."Get that? Solar is not an energy market. It is a political market. And once the political capital is gone the money dries up. The only way to make solar a real market is to get the cost below that of alternatives or provide advantages that outweigh the extra cost. Take solar garden lights. Their advantage even if they cost more than the alternative is ease of installation. But to move massive quantities of solar they are going to have to come down to the $1 a watt range - installed. That means cells costing 50¢ a watt. We have a ways to go for that. The nice thing is that we are now in striking distance, in the home stretch. It is no longer several orders of magnitude of cost reductions required. Just a factor of four or five. We will probably cover that ground in 5 to 15 years. Depending on whether we have to grind out improvements or we get lucky.
Ah. But all is not lost. Maybe an American politician will come to the rescue.
U.S. President Barack Obama on Wednesday (Jan. 28) met with business leaders to discuss the economic stimulus bill.I think he should have said "saw". With production better than 2 1/2 times demand I can't see the need for a lot of new production capacity at this time. And why does the government need to pour money into this technology? Because at current prices it is an unsustainable industry.
Cross Posted at Power and Control
Why hasn't Polywell Fusion been funded by the Obama administration?
posted by Simon on 02.02.09 at 01:17 PM
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