The “Solar Singularity” Approaches

January 8, 2016

Tam Hunt in GreenTechMedia:

My key assertion is that under current cost trends for solar and wind power, and (less certainly) for other renewables and electric vehicles, we are well on our way down a path to dramatically reduced emissions.

Whether such emissions reductions will actually mitigate the worst impacts of climate change remains a very big question. But my hope is that observers and commentators alike will understand that cost declines for many technologies in the last decade have brought us to the point where renewables and EVs are poised to achieve ubiquity relatively quickly.

I made the solar singularity concept the centerpiece of my 2015 book, Solar: Why Our Energy Future Is So Bright. I offer here an update on the topics covered in my book, showing that we are perhaps even closer to the solar singularity than I previously dared to suggest.

This cost of solar power is highly competitive with fossil fuel and nuclear electricity. The Energy Information Administration calculates in its 2015 analysis that the average U.S. levelized cost for new natural-gas advanced combined cycle plants is 7.3 cents per kilowatt-hour — the same as solar.

However, to compare accurately, we have to add about 10 percent to the cost of solar to firm up this variable resource. So we’re close to cost parity, but not quite there.

At $1 per watt, the levelized cost falls to just 5.7 cents per kilowatt-hour, well below cost parity with new natural-gas plants. With two-axis trackers and the best solar resources, which increase the capacity factor to 32 percent, that cost falls to just 4.5 cents per kilowatt-hour. We’re headed to $1 per watt as an all-in cost in the next five to 10 years.

These are world-changing developments. Imagine 10 years ago that by 2015 we’d see solar — solar! — account for fully half of all new global generation. When we add wind and other renewables into the mix, it’s clear that fossil fuels and nuclear are rapidly becoming endangered species.

Renewables provided almost half of all new power generation globally in 2014, according to the International Energy Agency. The agency’s executive director, Fatih Birol, summed up the trend: “[Renewables are] no longer a niche. Renewable energy has become a mainstream fuel, as of now.”

Bloomberg New Energy Finance reported last summer that wind power was the cheapest source of power in the U.K. and Germany in 2015, even without subsidies. The article’s tagline reads: “It has never made less sense to build fossil fuel power plants.” The same article highlights the feedback loop that solar and wind power have in terms of reducing the cost-effectiveness of fossil fuel power plants due to the dispatch order of renewables versus fossil fuel plants.

The solar singularity is indeed near (here?) in the U.S. and increasingly around the world. I described previously that 1 percent of the market is halfway to solar ubiquity because 1 percent is halfway between nothing and 100 percent in terms of doublings (seven doublings from .01 percent to 1 percent and seven more from 1 percent to reach 100 percent). The U.S. will reach the 1 percent solar milestone in 2016. We’re halfway there. Buckle your seatbelts.

A new report from Lazard found that battery storage is currently economically viable for some applications (frequency regulation, for example) even without subsidies. More importantly, the storage industry is set for rapid cost declines in the next five years as various technologies ramp up around the world. The report’s lead author stated that “the energy storage industry appears to be at an inflection point, much like that experienced by the renewable energy industry” a few years ago.

This new report comes on the heels of Southern California Edison’s first energy storage procurement in the Los Angeles area in 2014, which included accepted bids for 240 megawatts of projects that were selected based on economics alone (the utility was required to accept only 50 megawatts). We don’t know yet if these projects have been built at the costs bid (that data is not yet public), so we’ll need a bit more time to establish the cost viability of these technologies.

Another new report from Goldman Sachs projects a drop in price for storage technologies by almost two-thirds by 2020.

Energy storage is still a very new market, so my crystal ball is a bit murky when it comes to the future. Most analyses, like Lazard’s, use industry-supplied data that hasn’t yet been checked by the market or third parties, largely because there isn’t enough publicly available data for such fact-checking.

I agree, however, with Lazard’s conclusion that the storage market is set for rapid cost declines and rapid installation growth in the coming five to 10 years in both the stationary and vehicle domains. The above discussion establishes how rapidly solar is likely to grow around the world in the coming decades, giving some confidence in a steadily rising storage market.

17 Responses to “The “Solar Singularity” Approaches”

  1. jimbills Says:

    Either: a) this is right, and there’s no need to worry about any of this, or b) Kurzweil is wrong, and believing he’s right only supports apathy and the status quo.

    Here’s our current reality:

    • dumboldguy Says:

      Thank you for saving me the trouble of posting such a graphic. There are many similar ones out there, and they may differ slightly, but they all tell the same story. Renewables may be “doubling” at this point in time, but they haven’t even kept up with overall growth at present and likely won’t for many years.

      ONLY 7 more doublings will have them providing ALL our electricity, but the truth lies in the fact that coal, oil, and natural gas are NOT declining, as this graphic points out, and therefore our CO2 will keep going up. Kurzwell is peddling bright-sided technological BS.

      You and I and others have talked about how the “growth without pain through technology” model is never going to work. Kurzwell and his buddy Musk are accomplished and smart men in many ways, but they are entrepreneurs first and foremost—members of the group that has put mankind and the planet in such deep trouble with their belief in technological fixes.

      I vote for b)—Kurzwell and his ilk actually do as much damage as the deniers.

    • ontspan Says:

      The difference being that he’s (and the article) are talking about electricity, while your graph is about all primary energy use (heating, transportation, cooking and electricity generation)?

      • dumboldguy Says:

        That’s a good point, but true only up to a point. Here’s a link that shows some more graphs. All these graphs point in the same direction, as I said in an earlier comment, but differ slightly in what they are plotting against what and time frames .

        It matters little, in that coal-peat-oil-gas consistently add up to 60-65% of the total whether you’re talking about electricity only or all uses, and renewables disappear into supporting the growth part of the curve without reducing reliance on fossil fuels very much.

  2. kap55 Says:

    “The Energy Information Administration calculates in its 2015 analysis that the average U.S. levelized cost for new natural-gas advanced combined cycle plants is 7.3 cents per kilowatt-hour — the same as solar.”

    Absolutely false, as the embedded link shows. EIA numbers for 2015 are:
    NGACC 7.3¢ / kWh
    solar PV 12.6¢ / kWh
    solar thermal 24.0¢ / kWh

  3. rlmrdl Says:

    In any case, what would be the energy/resource depletion/pollution cost of making enough devices to make a difference?

    My guess is that, if GDP is a rough analogue of CO2 and other pollution, we are on our way to a major reduction in such assaults. Lotta people going to die of hunger, cold, heat stress, disease etc in the process; but that is where we chose to go 25 years ago.

    • markle2k Says:

      “My guess is that, if GDP is a rough analogue of CO2 and other pollution”

      Why would you GIGO yourself with Cargo Cult science like that? Even using energy usage as a proxy for economic activity is faulty because the cheapest fuel these days is energy efficiency.

  4. indy222 Says:

    How do subsidies figure into those costs? I didn’t see this promo piece mention that. All it took was the threat of the end of solar subsidies by the end of ’16 to send the solar stocks spiralling downward. There’s another reason Kurzweil may be too blase’ about simply extrapolating an exponential trend. Solar is not like packing transistors on semi-conductors. The Carnot theoretical maximum efficiency for solar cells is already less than a factor of two away from being achieved. No “Moore’s Law” of solar is going to continue extrapolating downward the costs of solar. And you can’t ramp up sun either. Most of the costs now in solar installations are in labor and other components like inverters, wiring, etc. These are not likely to trend downward nearly so fast, if at all. Economies of scale will help, but we’ve already got much of that accomplished – there’s big multi billion dollar factories spewing out solar panels. Still, it only has to be cheaper by a little to win the war.

  5. I have to call ABSOLUTE TOTAL BULLSHIT on this….

    The experts quoted regarding “Energy Storage”? Financial advisory firm Lazard INVESTMENT BANKERS!!!!

    I expect to see this on Zero Hedge!!! Reminds me of the tactics the investment bankers used to drum up investment in the “shale oil revolution”… you know all those note defaults you don’t hear about on MSM as the oil companies hedges expire. Remember when the US was going to be self sufficient and not have to “import oil” in the very near future???

    Look, $1.00 per watt is just the cost of the panels, and that is buying them by the pallet on special… there is currently one panel at $.90 per watt!!!!!! THAT IS JUST THE COST OF THE PANEL….

    link to wholesale solar

    I am a retired project manager (power plants) and an engineer, you need a whole lot of other things to make these systems work!!!

    You also need to consider the Return of Energy on Energy Invested… and solar PV systems don’t come out so well on that calculation. Gail at Our Finite World has all the cited calculations on this, her work is very good. There are also some older excellent reference articles on The Oil Drum.

    Any new “technology” is going to have to have a “school of hard knocks” “real world”, “get your “hat” handed to you” learning process to become “reliable”….. this is realistically a 20 year in the field learning curve (if you are lucky and have some exceptionally talented and dedicated people working on the project). Been in the trenches (start up and operations) and done that…

    We are out of time…… and no I am NOT a Nature Bats Last groupie…. but I am pragmatic and realistic and I hope someone comes up with a “hail Mary pass”…

    PV is a band aid.

    The Power Grid is not sustainable and there is nothing in the pipeline that can replace fossil fuels in the time line that we need to avoid the 2 deg C limit.

    That is short of shutting down a very large portion of the generating plants….. and with that all hell breaks lose.

    Sorry for the rant….

    • greenman3610 Says:

      see Michael Osborne above.

      • Yes I agree that the Utilities have WAY to much power… but that is a different issue. And yes decentralization is a good idea for many different reasons.

        How are you going to go about doing that? The devil is in the details and I am not hearing a lot of details in those wonderful sound bites… I am hearing sale pitches… and I hate salesman…..

        So where do you go to get hard real world data?

        The EIA is one source… it is not current, 2 years plus some months old, but it is well cited and documented. And yes they do document that there has been a 22 percent drop in the capital cost to build the large PV Gen.

        For the real world numbers on generation (latest 2013), per the EIA, go to page 10.

        Click to access updated_capcost.pdf

        If you want to have a real world understanding for the cost of “energy storage” well that is also in this report… keep in mind that this is on top of the total cost of generation (cost to build or overnight capital cost) plus fixed and variable O&M. Look under Fuel Cells and Pumped Storage, I know of one small “flywheel” storage facility outside of Albany NY owned and operated by NYPPA, but I did not see a category for that in this report.

        I am not hearing any discussion on the cost of Maintenance on the “slick PV system” nor have they discussed Reliability…. but of course you have to have experience operating these systems for a bit before you can make ANY creditable claims on this subject. Do you remember the claims Stone and Webster made about the Nuclear Plants, maybe you are not old enough to remember that??? How accurate was their crystal ball?

        The fixed O&M costs per the EIA for PV is not that great… 150 plus MW PV systems are averaging around $25/kWyear, 20MW – $28/kWyear… compared to a Natural Gas plant at around $13/kWyear…. yes your fuel is free with PV but your capital cost for PV is four times that of a Natural Gas Gen… $4million per megawatt verses $1million per megawatt. (those numbers include the recent 22% decease in the cost of PV systems)

        Next to consider… how much total Green house Gases are emitted in the process of building these Gen Plants… both PV and Natural Gas… and how much is emitted during operation and MAINTENANCE!!!!! There needs to be a total and complete Green House Gas budget done, this includes manufacturing of ALL of the components needed to construct the plant and the on going operation and Maintenance of the plants….. than compare the options side by side… To draw any reasonable conclusion the two key parameters are.. Total Green House Gas Budget and “ALL IN” real world cost..

        You have given me a link to sound bites with inane discussions with tea party quacks, industry shills (both sides of the table) and investors/investment bankers.

        Please provide REAL WORLD CITED data to back the claims (please don’t give me a link to an investment banker……)! I am more than willing to take the time to research and review them…

        It would be a pleasure to find a ray of light in the tunnel that isn’t the train.

        We are not going to get a “do over”.

    • dumboldguy Says:

      What are your thoughts on GEN4 nuclear power? If the world built nuclear plants at the rate Sweden and France did in the past, we might just meet the CO2 targets.

      Qvist and Brook estimate that if the world built power plants at the rate Sweden had 40 years ago, all coal and natural gas power plants could be phased out in 25 years. If France’s pace is considered, it would take 34 years”.

      “Continued nuclear build-out at this demonstrably modest rate, coupled with an electrification of the transportation systems (electric cars, increased high-speed rail use etc.) could reduce global CO2 emissions by ~70% well before 2050,” they write in PLOS ONE”.

      “Replacement of current fossil fuel electricity by nuclear fission at a pace which might limit the more severe effects of climate change is technologically and industrially possible—whether this will in fact happen depends primarily on political will, strategic economic planning, and public acceptance,” the authors conclude.

      • In an ideal world nuclear makes sense… however we do not live in an ideal world.

        Humans make mistakes….

        Engineers (and groups of engineers) make bone headed judgements during the design process or fail to take into account “known unknowns”…..

        Contractors have construction budgets and critical path (completion deadlines) that have to be kept and corners are cut…

        Operators… well don’t get me started on the human error that happens during watch (think Homer Simpson…) the best operators where the guys off of the nuclear subs…

        Utility Companies have lobbyist that have undue influence on the watch dogs that are supposed to hold everyone’s performance to ensure the safe construction, operation and decommission of these facilities. There are conflicts of interest….. Mistakes are made due to greed, ignorance, an “I don’t give a s*&t attitude” and corruption.

        I have been in conventional plants power plants that have failed catastrophically…. it is not that unusual. When a nuclear plant fails catastrophically.. well lots of people die… and/or suffer… and it is impossible to EVER clean up and remedy.

        With a regular power plant… hopefully no one got killed… the place is a mess, but you have business interruption insurance and some insurance to cover the machinery replacement cost… it can be fixed and if not the site can be “clean up”.

        I don’t know if an insurance company will insure a nuclear power plant… and that is telling.

        Then you have to think about cost and Green House Gas Budget… both to build and to maintain/operate… I have yet to see a good Green House Gas Budget that includes Construction and Maintenance… my gut is that the number is bigger than most realize, but to date I don’t have any hard numbers for that.

        Arnie Gundersen is really much more qualified to speak to issues about nuclear power plant safety.. his resume and ethics are impressive.

        • dumboldguy Says:

          I agree with “It would be a pleasure to find a ray of light in the tunnel that isn’t the train. We are not going to get a “do over”, and thank you for providing some insights from the “inside” of the power generation industry.

          IMO, Arnie Gundersen’s “resume” and “ethics” are “impressive” only in the sense that he is a very good “anti-nuke” spokesman. It’s interesting that you would cite him. Would you characterize yourself as “anti-nuke”? I was definitely so back in the 1970’s and signed an anti-nuke letter (along with a number of Nobel Prize winners) that got printed as a full page ad in the Washington Post. I have since come full circle, along with James Hansen and others, and believe that we will NOT avoid major catastrophe unless we make a large injection of new nuclear power into the CO2 reduction equation. We are just not making enough progress fast enough on any of the other fronts.

          Is nuclear power at base a dangerous technology? Yes. Have there been accidents in the past? Yes Are humans incapable of controlling their technology? All too often, No.

          However, it’s a big planet and able to accept localized “insults”, man DOES learn from his mistakes, and GEN4 nuclear plants hold the promise of being much safer to operate and producing less waste. Chernobyl or Fukushiima type disasters would be much less likely to happen in the future, and even if some did occur, the localized impacts and death of even a few thousand people pales in comparison to the present damage done by burning fossil fuels, to say nothing of what the future holds if AGW persists. In the entire history of the technology, Fewer people have died or been injured as a result of nuclear power than are killed or injured in ONE day by fossil fuels.

          I will ask again, are you anti-nuke?

  6. […] Peter Sinclair of reports: […]

  7. […] Peter Sinclair of reports: […]

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