European Solar Power 'Competitive' By 2020

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Solar power could deliver electricity as cheaply as coal-fired plants in certain European countries within the next two years.

This is the main finding from the European Photovoltaic Industry Association (EPIA), which examined key European countries and found that solar photovoltaic (PV) power will reach full cost parity with coal by 2020 but, in some countries, it could get there as early as 2013.

The EPIA's extensive study of the PV markets of France, Germany, Italy, Spain and the United Kingdom concluded that with the right regulatory and market conditions, PV electricity can reach full competitiveness with conventional power sources across Europe by the end of this decade. The conclusion is reached by assessing the falling costs of PV components and subsidies available against the increasing emissions costs associated with running fossil-fuel power plants. The group highlighted how the cost of PV technology has dropped dramatically over the past 20 years, with the price of modules decreasing by more than 20% every time the cumulative volume of modules has doubled. There is still room for prices to fall by about 50% before the end of the decade, the association said.

Just this week, Germany reported that renewable energy supplied more than 20% of its electricity in the first half of 2011, with solar power growing by 76% over the same period in 2010 to become the third-largest renewable energy source. For additional information, see September 6, 2011, article - Renewable Energy Tops 20% in Germany.

The EPIA estimated that the cost of PV electricity generation in Europe could decrease from €0.16-0.35 per kilowatt-hour (kWh) in 2010 to a range of €0.08-0.18 per kWh in 2020, depending on system size and irradiance level. However, it should be noted that in recent years that the subsidies available for solar power rollout have been curbed in key markets including Spain, Germany, France and Italy.

"Already today, PV electricity is cheaper than many people think," explained EPIA President, Ingmar Wilhelm. "In the coming years it is going to get even cheaper thanks to ever-improving technology and economies of scale. As also the price of electricity from conventional sources increases, solar PV will be become a fully competitive part of the energy mix."

The EPIA claimed that 'dynamic grid parity'--the point at which the value of the long-term electricity revenues from a PV installation equals the long-term cost of receiving fossil fuel-based power over the grid--could be reached in Italy's commercial sector as early as 2013. Using Italy as an example, it found that ground-mounted PV in Italy could also become as attractive to potential investors as fossil-fuel plants by 2014.

"Switching to solar photovoltaic electricity is not just a desirable option for achieving our energy and environmental goals," added Wilhelm, "It is also a realistic and competitive one. By creating the right conditions now for the development of PV, we can ensure that it fulfils its promise as a clean, safe and infinitely renewable energy source and a major part of Europe's energy mix."

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