Solar Energy Perspectives - IEA

Solar Energy Perspectives: Policies
Figure 10.2 Average wholesale electricity (incl. CO 2 ) prices
and impact of renewable support in selected OECD regions
Additional cost
of renewables
Wholesale price
120
100
80
USD per MWh (2009)
60
40
20
0
Current
Policies
Scenario
450
Scenario
Current
Policies
Scenario
450
Scenario
Current
Policies
Scenario
United States European Union Japan
450
Scenario
Source: IEA, 2010b.
Key point
Additional costs of renewables are limited compared to overall electricity costs.
Spend wisely, share widely
Funding to support solar energy deployment must be spent wisely, where the additional
costs of solar electricity are null or lowest, and both efforts and benefits shared widely.
The same support incentives will have greater leverage if they are spent in decentralised
generation, peaking plants or hybridisation of existing (or unavoidable greenfield) fossil
fuel plants – in sum, in projects that are less costly and/or have more expensive
competitors, and above all in sunnier countries. As technology costs decline, leading
profitable markets will increase in size and further reduce the level of subsidies implicit
in support schemes.
To date, only Japan, Germany and a handful of European countries have been effectively
deploying PV. The bulk of STE/CSP deployment has been concentrated in only two
countries, Spain and the United States. This is changing as European countries are adjusting
their incentives, many others are implementing new policies and some are setting targets
for solar, particularly solar electricity: for example, 9GW PV and 1 GW CSP in China by
2015, 2 GW (PV & CSP) in Morocco, 20 GW (all solar technologies) in India, all by 2020,
1.2 GW (CSP) in South Africa, 7 GW (PV & CSP) in Egypt and Saudi Arabia, and 10 GW
(7.2 GW CSP, 2.8 GW PV) in Algeria by 2030 – not counting additional capacities for
exports.
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© OECD/IEA, 2011