Solar Energy Perspectives - IEA

Chapter 3: Solar electricity
Chapter 3
Solar electricity
Generating carbon-free electricity will not only eliminate the current carbon dioxide
emissions from electricity generation, but also help eliminate emissions resulting from direct
fossil fuel consumption in the building, industry and transport sectors through increased
electrification. PV is developing rapidly and its costs are falling just as fast. Solar thermal
electricity (STE) lags behind but, thanks to heat storage, offers considerable potential. As their
accessible markets expand, these technologies look more complementary than competitors.
Background
Terrestrial applications of solar photovoltaics (PV) began in the 1970s, and developed in niche
off-grid applications, mostly rural electrification and telecommunications. In the 1980s, the
first commercial concentrating solar power (CSP) plants generating STE (backed by 25%
natural gas) were built in California’s Mohave Desert, and were based on federal and state tax
incentives for investors and mandated long-term power purchase agreements. They totalled
354 MWe by 1991 when Luz, the builder, filed for bankruptcy. They are still operating today.
In the 1990s, various countries introduced incentives to support early deployment of solar
photovoltaic systems. In 1995, the Japanese 70 000 solar roofs programme began, initially
providing 50% subsidy of the cost of installed grid-tied PV systems. The German 100 000
solar roofs programme began in 1999, followed by the Renewable Energy law in 2000, which
offered a EUR 0.5/kWh feed-in tariff on installed systems for 20 years. In 1998, Japan
surpassed the United States as the leading market. Germany took the second position in
2001, and overtook Japan in 2003. It has since remained the market leader.
The growth of the global PV market has been impressive since 2003, with an average annual
growth rate of 40% to 2009, and about 135% in 2010. The cumulative installed global PV
capacity grew from 0.1 GW in 1992 to 40 GW at the end of 2010, with 42% being installed in
2010 alone (Figure 3.1).
Meanwhile, a new wave of CSP plant building was initiated in 2005 in Spain and the United
States, with smaller realisations in a few other countries (Algeria, Egypt, and Morocco). STE
cumulative capacities neared 1 GW at the end of 2010 with several more GW under
construction or in planning ever after 3 GW of CSP projects in the United States were turned
into PV in 2011. The figure 3.2 presents CSP targets and plants (operational, under
construction and planned) as of September 2011, after several CSP project were turned into
PV project in the USA notably California.
The bright future for electricity
Electricity is more easily decarbonised than other fuels. It is thus set to play an ever-increasing
role in a world struggling to reduce its energy-related carbon dioxide emissions, while
enhancing energy security.
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© OECD/IEA, 2011