An obvious question about solar energy

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What is wrong with this picture?



The price of utility scale solar power has it seems almost halved in three years in the United States. Such falls oughtt to make anyone skeptical about whether they are real. The difficulty however with the clean-tech scene is that there are too many advocates passing off as journalists. So, very few people ask the obvious questions.

What is the main cause of the price drop here? Rather obvious. It’s the cost of the modules dropping by around a factor of three. And anyone who is half informed about this knows there is a huge problem. Both the EU and the US government take the official position that China is dumping solar panels below cost on the international market. The EU thinks they might be selling them at almost two times below their actual cost.

So, here is what different branches of the Obama Administration is telling us. That the above the cost reductions are a function of the fabulous success of the Sunshot program. And that a very significant portion of it is a result of China selling America under priced solar panels. The economics of solar power therefore look about as dicey as it gets. Or perhaps we can rely on the dubious economic and industrial policies of the Politburo in Beijing for a while longer.


3 thoughts on “An obvious question about solar energy

    Proteos said:
    February 23, 2014 at 12:16 pm

    Even more worrying than the trade war rhetoric is the fact that administrative and building costs nearly take 90% of the target price of $60/MWh. Which means that giving the pannels for free would not be enough to reach it. There seems to be a hard price floor for solar PV and that we won’t see anything like the price drops of the last decade in the next.


      Robert Wilson said:
      February 23, 2014 at 4:21 pm

      Indeed. Higher penetration of solar PV will probably also lead to a significant increase in regulations to ensure the grid is reliable. Plus a whole assortment of externalities are not even included in the above price. Add on the almost inevitable grid connection fees that are coming and it is hard to see these price targets being met, even with China dumping cheaper and cheaper panels on the market.


    Steve Darden said:
    March 3, 2014 at 10:10 am

    Thanks Robert. Do you see China continuing to prop up failed solar plants? I thought they were pulling the plug on 2/3 of plants currently, with a view to winnow down to the plants that can profit while competing globally. If that view is correct we may have seen “cheapest solar cell price” until some real breakthrough comes along.

    Meanwhile Elon Musk continue to be Bullish on solar, and of course his company Solar City. Musk must have deep data on the solar supply chain through utility scale.


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