Solar is Cheaper than Ever

Several CEO's of solar companies were interviewed today in the WSJ to discuss the amazing price decreases of solar technology in the past few years.

First they began by stating that solar went from being among the most expensive energy sources to one of the least expensive.

At the beginning of their presentation they mention prices below one dollar per watt but then one of them corrects this information by stating that once installation, inverters, etc., are included the total price for a residential system is in the range of 4 to 5 US dollars per watt.

What was completely overlooked, however, was that on AVERAGE a solar installation produces power only 20% of the time (in a good and sunny place on Earth).  Thus for 80% of the time OTHER energy sources have to generate the needed electricity.

The above means that solar is always a surplus investment.  No matter how much solar is installed, we cannot remove any conventional generating capacity because aside from the obvious fact that at night there is no sun, a cloudy day can easily reduce the output of a solar installation by 90%.

Sure "if solar could be stored" the situation would be different, but here we have two issues:

1. Storage is extremely expensive and thus would drastically change the economic equation of solar.

2. We have to decide for how long we want to store it?  For a day? For a week? For three months? (Germany, the country with the most installed solar capacity has experienced its darkest winter in 43 years**).  Obviously, storage costs grow exponentially with the number of hours / days required to be stored.

If solar is somewhat viable today it is only because it almost fully depends on the conventional electrical grid to mask its intermittent nature. Furthermore, the costs quoted by the CEO's today do NOT include the additional costs the grid must incur to support the fluctuating nature of solar.

Conclusion: the money invested in solar could be better used, for example, in efficiency improvements and nuclear power.

** Spiegel: February 26, 2013.