'Insanely cheap energy': how solar power continues to shock the world | Energy | The Gu... - 0 views
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Over the last two decades, however, the IEA has consistently failed to see the massive growth in renewable energy coming. Not only has the organisation underestimated the take-up of solar and wind, but it has massively overstated the demand for coal and oil.
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Jenny Chase, head of solar analysis at BloombergNEF, says that, in fairness to the IEA, it wasn’t alone.
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“When I got this job in 2005, I thought maybe one day solar will supply 1% of the world’s electricity. Now it’s 3%. Our official forecast is that it will be 23% by 2050, but that’s completely underestimated,”
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This rapid radical reduction in the price of PV solar is a story about Chinese industrial might backed by American capital, fanned by European political sensibilities and made possible largely thanks to the pioneering work of an Australian research team.
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“We’ve got to the point where solar is the cheapest source of energy in the world in most places. This means we’ve been trying to model a situation where the grid looks totally different today.”
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In the very early years of the industry, the received wisdom had been that a 20% conversion rate marked the hard limit of what was possible from PV solar cells. Green, however, disagreed in a paper published in 1984.A year later, his team built the first cell that pushed past that limit, and in 1989 built the first full solar panel capable of running at 20% efficiency.
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It was a moment that opened up what was possible from the industry, and the new upper limit was “set” at 25% – another barrier Green and his team would smash in 2008. In 2015, they built the world’s most efficient solar cell, achieving a 40.6% conversion rate using focused light reflected off a mirror.
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“The first reaction was: that’s the future. Everybody said that’s the future. But they also said it was one step too early. What they meant was that there was no market for it yet. In China at the time, if you mentioned solar, people thought of solar hot water.”
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All that would change when Germany passed new laws encouraging the uptake of solar power. Quickly it became clear there was a massive global demand and the world’s manufacturers were struggling to keep up with supply.
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Spying an opportunity for investment, a consortium that included Actis Capital and Goldman Sachs came knocking to pitch Shi on taking the company public. When the company listed on the New York Stock Exchange in 2005, it raised $420m and made Shi an instant billionaire. A year later he would be worth an estimated $3bn and crowned the richest man in China, earning him the moniker “the Sun King”.
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Around 2012 the world market was flooded with solar panels, sending the price plummeting through the floor, leaving SunTech vulnerable. Already under intense financial pressure, disaster struck when an internal investigation found a takeover bid it had launched had been guaranteed by €560m in fake German government bonds.
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In a quirk of history, what had begun as an American drive to wean itself off oil was eventually taken up by China, which made solar power dirt cheap in the process.“The Chinese approach to renewables is all about energy security,” Mathews says. “At the scale from which they’re building new industries, they would need colossal imports of conventional fossil fuels, which would cripple them economically.
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“They can get around that problem, which is a geopolitical obstacle, by manufacturing their own energy equipment.”
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“We think a 40% module, rather than the 22% you can do nowadays with PERC, is what the industry will be doing once we perfect this stacking approach,” Green says. “We’re just trying to find a new cell that will have all the qualities of silicon that we can stack on top of silicon.
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“The International Energy Agency now says solar is providing the cheapest energy the world has ever seen. But we’re headed towards a future of insanely cheap energy.“It’s a fundamentally different world we’re moving into.”