The “Solar Myths” page is the most linked to and most read part of this blog – most hits there than most other posts put together, and it’s the post that generates the most emails and questions. I’ve been meaning to add a few more myths and I’ve been meaning to expand a little on some of the points that I raised. Recently I got called on Myth #7 – Solar power needs extremely intense sun to work (solar isn’t for Canada, New York, the UK etc) as needing more explanation – the points as stated are a bit thin, so I might as well expand on that one now.
First off, my point, not well made in the original, is that the price of electricity or incentives for renewable energy are more important than “solar resource” when considering the viability of solar energy. What they’re considering here in Ontario is a case in point – they’re instigating a progressive feed-in tariff regime which will massively incentivize home solar development, commercial development and the development of solar farms. There are many places in North America where the same solar panels would produce slightly more or much more electricity per day, but they’ll be installed here, because the incentives are here. Now, in Ontario, the reasons are regional and complicated – basically Toronto is inching closer and closer to a severe electricity shortage, and they want to shut down a really horrible coal burning power station that is a national embarrassment – but at the end of the day, they need every scrap of additional power they can get their hands on.
But look at a different example – using the PVWatts Calculator default settings (4 kW Peak System, 0.77 DC to AC Derate factor, latitude fixed tilt) for Newark, New Jersey and Cedar City, Utah. Cedar City is in southern Utah and gets much more sun on average than Newark, but look at the results:
Newark, New Jersey
State Average Cost of Electricity – $0.112/kW
kWh/m2/day – 4.46
kWh per year – 4732
Value of Energy per year – $529.98
Cedar City, Utah
State Average Cost of Electricity – $0.072/kW
kWh/m2/day – 5.95
kWh per year – 6281
Value of Energy per year – $452.23
So, even though the Utah system produces over 1500 kWh per year more, or close to 30% more power per year, the higher cost of electricity in New Jersey makes the Newark system more valuable – producing just over $75 more per year. The variability in the cost of electricity is much bigger than the variability in the solar resource.
Average Price of Electricity by State in the US
States where electricity is expensive and sun is excellent (California) will lead solar, but the second runners will be the states with expensive electricity (or incentives for solar) – NOT the states with great solar resource and cheaper power. So it’s not surprising that California leads the US in Solar adoption, but considering the map above, it’s not a surprise that New York, New Jersey and Connecticut are the next four states with the highest per capita solar adoption. (New Jersey and Connecticut also have state solar incentives.)
Now, what makes the price of power vary from state to state is a whole complex set of factors, but ask anyone who works in electricity and they’ll agree that that prices of electricity are going up nearly everywhere. Prior to the financial crisis, analysts were predicting that the price of electricity would double in 5 to 7 years for most regions of North America. Some now say that will slow down (consumption is dropping) and some say that will accelerate (collapse of financing for new power stations and for grid upgrades) but no one is saying the price of electricity isn’t going up.
Rising Price of Electricity
In my original post I used the example of Germany. Germany does not have great solar resource – the average kWh/m2/day is very low comparatively – ranging from 2.6 kWh/m2/day to 3.7 kWh/m2/day. There are parts of Alaska that have better averages, and the lower 48 states mostly get 5.5 to 6 kWh/m2/day or better. Yet, until the end of 2007, 50% of all the solar panels installed in the world were installed in Germany. If that doesn’t prove that the amount of sun ISN’T the main factor, then nothing will. Germany decided that they wanted to create a thriving solar energy industry, partly to deal with rising costs of electricity and partly to get ahead of the world on what they saw as a growth industry. They examined the possibilities and went with a feed-in tariff system, which made solar installation viable, especially in the south. But those same panels could product two to three times more power (or more) in most of the USA. They make sense in Germany because of laws rewarding solar energy.
The USA and Canada are starting to follow the same model. The USA has the Investment tax Credit which creates large tax incentives for installing solar, and in Ontario they’re following the feed-in tariff model. That, combined with falling solar panel prices and rising costs of electricity will lead to more and more solar installations.
Long and short, I originally raised the issue that intense sunshine as a pre-requisite for solar energy was a myth and I stand by that. The pre-requisite for solar energy is the need for ANY alternative energy – which isn’t driven by the sun (air conditioners notwithstanding) but by shortages or high costs of existing sources of energy.
