Price / Value of Solar

I have a big four thousand square foot roof in one of the greatest solar sites in the world (6 equivilent hours of full sun a day) that is just begging for solar panels.  Except that even with substantial government subsidies, the payback numbers are awful. Lynne Keisling reports that this may be about to change:

There are a couple of very interesting recent solar developments that have substantial economic implications. First, the blue sky stuff: courtesy of Slashdot, a team of researchers in the Netherlands have demonstrated avalanche effects in semiconductors that can be used in solar cells (here’s the original article). Avalanche effects mean that instead of having a 1:1 relationship between a photon and an electron, in which 1 photon releases 1 electron, it’s physically possible in these nano-scale semiconducting materials to have 2:1 or even 3:1 — 2 or 3 electrons released per photon in the material. This means twofold or threefold increase in the possible energy intensity of the solar cell material. These nanocrystals are even inexpensive to manufacture. How cool is that?

What are the economic implications of this new material and new knowledge? The low energy intensity of solar cells has been a factor in making solar a less cost-effective means of generating electricity than fossil fuels, which are extremely energy intensive. This avalanche effect can mean smaller, more energy intensive solar cells, which changes the cost structure for solar. I think it will certainly shift the long-run average cost curve downward, which creates an opportunity for solar retailers to reduce prices. A lower solar retail price shifts the price ratio between solar power and all other electricity power sources. For example, the price ratio between solar-generated and coal-generated electricity would shift such that at the margin, consumers would substitute out of coal-powered electricity and into solar-powered electricity. If I were better at generating the isoquant and indifference curve graphs electronically, I’d show it here graphically … but the logic is straightforward.

Unfortunately, we have been hearing this for years.  I price solar out on my home just about once per year, and the numbers have not changed for a while.  Here’s hpoing….

  • Yes, I am still waiting for other emerging technologies like mram, holographic memory, and quantum computing. Sadly, even foveon’s new X3 cmos chip line has not had much uptake by camera manufacturers. I was hoping for some faster and clearer video cameras. Similarly, for now we are stuck with the non-avalanche type of solar cells. — John M Reynolds

  • Curt

    Have you been following the progress of Nanosolar? They are already in mass production of thin-film flexible solar panels that they say they are selling for under a dollar per watt of capacity and making for 30 cents per watt. I’ve seen claims of 14% conversion efficiency (but no confirmation). If so, a 4’x8′ sheet could generate about 300W peak at $300 cost (not including installation and inverters).

    When they announced they were starting to ship production units at the turn of the year, they said they were already sold out through mid-2009, mostly to Germany, where the utilities have to pay ridiculous amounts for solar-generated electricity. So even if all true, it will still be a while before you could get your hands on some.

  • Doug

    According to Wikipedia (and they couldn’t possibly be wrong, could they?), the maximum incident power hitting a 1 meter square surface area is a maximum of about 1 kilowatt. That is, if you had a solar panel with 100% efficiency, the most power you could extract from the thing would be 1 kW. I’ll not dispute this figure simply because I don’t have any data to dispute it. Thus, a 14% efficient panel would yield 140 watts of peak power. Your 4′ x 8′ sheet represents 4.26 square meters, and should therefore produce 596 watts, not 300 watts. Where’s the additional 50% loss? Or is this 14% figure deliberately misleading and should actually be 7%?

  • Luis Dias

    Yeah and I’m also waiting for those damn pentium computers. They told me that they would be able to run windows and MS Word without much lag, and also they would be able to play Quake II.

    But hey, technology is well known to always fail its promises, ain’t it? Just look at the iPhone. Isn’t that a perfect example of how bad can a phone become?

    Hogwash. You’re turning your criticisms against vaporware. Technology is really ramping up on solar and other renewables because of the price of the barrel of oil and of coal, which are soaring. Check the investments. They are really betting in any alternative solution. So, it’s not as if we are stuck in the 90s here.

  • Curt


    I took 4 feet as just over 1 meter, and 8 feet as just over 2 meters, to get a little over 2 square meters. Then I applied the same 1 kW/m^2 (which I remember from my college solar engineering course) and a little conservative rounding down, all without actual calculation.

    Now the true area of a full 4’x 8′ panel is just under 3 m^2 (2.97 m^2) not 4.26 m^2. So I did underestimate, but not by a factor of over 2. I’d estimate now 400W peak.

  • Stevo

    “the maximum incident power hitting a 1 meter square surface area is a maximum of about 1 kilowatt”

    Have you considered using mirrors to increase the light falling on the collection area?

    This sort of back-of-envelope calculation is all very interesting, but misses out most of the actual considerations in whether the technology is economically viable. Peak power is not really a very interesting metric, since it is virtually never achieved and never sustained. Barring a major breakthrough, I’m personally not expecting it to make economic sense for a few decades yet. But so long as you don’t try to sell it to people on economic grounds (or saving-the-world), there are all sorts of other reasons why people could legitimately want one.

  • Mike

    I’ve often heard people tell me they wanted to invest in PV (photovoltaic) solar. But when talking to them, I come to realize they have no understanding of the costs, and the little amount of power is actually produced. These people are often upset by rising utility rates. But they don’t realize that utility rates would have to rise dramatically before PV would actually save them money.

    They often “disagree” with me when I suggest that they first look at energy efficiency upgrades or reducing consumption, or by signing up for any one of the local utilities “time of use” type plan that saves you money by shifting their usage. The key to saving money on a PV system is to require as small a system as possible.

    Of course, if you really want a short term payback, you should invest in solar water heating. Solar water heating is more efficient than PV energy production. Considering that water heating is the second biggest consumer of energy, the savings can be realized in a few years with subsidies.

    One piece of technology I’m looking into is the heat pump water heater (HPWH). Instead of using resistors to convert electricity into heat, a heat pump is used to “pump” heat from the surrounding air into the water in the tank. This can cut energy consumption by over half. Other benefits include cooling of the surrounding air by the heat pump, which benefit those that live in a hot climate where the water heater is in a conditioned space, as in my case.

  • cookie

    The Laws of Thermodynamics.

    Nuff said.

  • cookie

    The Laws of Thermodynamics.

    Nuff said.

  • stas peterson

    Solar Energy is a pollution pig. Up to now it has been used in only an insignificant way. But any widespread attempt to use solar energy would rapidly expose its warts. A solar array is an albedo altering effect, par excellance.

    It drastically would increase the amount of energy absorbed by the Earth for every square meter installed. That means more energy and “Thermal Pollution”.

    Some of the zany suggestions to scale up the size to represent what kinds of areas would be needed to harness an equivalent of the present US electric grid with solar,make the problemplain. The area needed rapidly climbs to areas equivalent to the States of Arizona, Nevada, and New Mexico combined.

    Consider trying to apply for an EIS. Raising the temperature by several degrees in these states would likely kill or barbecue all life in those states, as well as create enormous local climate changes. For example: “Explain on your EIS application, how many tens of thousands of species you propose to drive to extinction. Please be specific.”

    Solar energy is only 10 or 12% efficient and lots of the heat additionally absorbed, that extra 90% energy is just waste heat, useless to do anything except thermally pollute.

  • wild01

    stas, I thought about addressing this response dear moron, but no need to get that nasty. your claim that solar panels would increase thermal pollution is laughable at best. sunlight turns into heat when it strikes any dark surface. period. so by your reasoning we could lower warming by painting all the dark surfaces in the world white. the only way that solar would increase heat is if the panels are being placed over what would normally be a white surface. as long as they are placed over a surface that was already dark (say a roof for example, there will be a net cooling effect because while all solar energy absorbed into a black rubber roof is converted to heat, at least 10% of the solar energy absorbed by the solar panels is converted to electrical energy, resulting in a 10% heat reduction. (ever been in an attic on a hopt summer day?)