As government announces changes to renewable energy subsidies, new reports from the International Energy Agency (IEA) suggest that solar could be the world’s largest source of electricity by 2050.
Two technology roadmaps from the IEA, one for solar photovoltaic (PV) energy and one for solar thermal electricity (STE), argue that solar technologies could be responsible for 27 per cent of the global electricity supply by 2050, which would make solar the leading single source of electricity ahead of fossil fuels and other renewables.
According to the IEA, this would prevent the release of over six billion tonnes of carbon dioxide per year by 2050, which is more than all of the direct emissions from transport currently emitted worldwide each year.
The roadmaps detail the targets and policies that the IEA argues are required if this vision is to be achieved.
‘Rapid cost decrease’
According to solar market analysts, NPD Solarbuzz, decreasing solar technology costs are fuelling a boom in installations worldwide, with more capacity expected to be installed in the final quarter of 2014 than in the whole of 2010 alone.
In August this year, the UK became the sixth country to pass 5GW of installed capacity.
However, Maria van der Hoeven, IEA executive director, maintains that government support for solar technology will still be required into the future if it is to reach its potential.
“The rapid cost decrease of photovoltaic modules and systems in the last few years has opened new perspectives for using solar energy as a major source of electricity in the coming years and decades”, she said.
“However, both PV and STE technologies are very capital intensive: almost all expenditures are made upfront. Lowering the cost of capital is thus of primary importance for achieving the vision in these roadmaps.”
Van der Hoeven’s recommendation, however, conflicts with the Department of Energy and Climate Change (DECC)’s recent announcement to end Renewable Obligation (RO) subsidies for large solar PV installations next year.
The decision, which followed a public consultation with the solar industry, means that new solar PV installations above 5MW in scale will not be able to receive RO subsidies from April 2015, two years earlier than originally planned.
DECC explained that its decision was based on concerns that large-scale solar is deploying more rapidly than previous estimated and risks breaching the Levy Control Framework (LCF), which sets an annual limit on the cost of RO in order to minimise the impact on consumer energy bills.
Instead, solar installations over 5MW have to compete with other ‘established’ renewable energy technologies – including onshore wind and energy-from-waste – for subsidies under the Government’s Contracts for Difference (CfD) scheme, with DECC announcing a £95 million boost for this year’s CfD auction.
The Government is also shifting support away from large ground-mounted solar installations towards smaller rooftop-mounted installations, in line with its Solar Strategy.
‘Pulling the rug’
However, Paul Barwell, chief executive of the Solar Trade Association (STA), argued that the CfD scheme and new support for rooftop-mounted solar will not offset the losses incurred to industry as a result of the changes.
“Pulling the rug on the technology the IEA says could be the biggest global power source by 2050 is crazy”, he concluded.
Juliet Davenport, chief executive of renewable energy supplier Good Energy, also voiced concerns, adding: “Solar is reducing its costs rapidly and is on track to be subsidy-free by 2020, [but] it needs stable support up to then, to continue providing thousands of jobs and investment.”
Posted under Environmental Regulations and Legislation and Environmental Technologies and Renewable Energy on 14 October 2014