Solar Power to the People
Source: uclick 2001-12-02

GOLDEN, Colo. -- When Rear Admiral Richard H.Truly was appointed director of the National
Renewable Energy Laboratory here, the former astronaut was quick to gather his staff and tour the
facilities. During the tour he went to a large photovoltaic panel and observed that he had a
special affection for them. They had kept him alive in space for weeks, he explained.

"They've kept me alive, too," said Lawrence L. Kazmerski, a Ph.D. whose quirky sense of humor
is matched only by his ties. "They've delivered my paycheck for years," he said, referring to the solar-powered satellite links that
move money all around the world.

Dr. Kazmerski, who is director of the National Center for Photovoltaics here, told me that story as
we sat in his office. "This is a great time for photovoltaics (PV) in the United States. It couldn't
be any better. Because of California, manufacturers can't ship enough.

"In the last three years we've seen a real shift in where PV is used. Last year 50 percent of
shipments went to applications tied into the grid. That's what the trend is -- away from off-grid
applications and onto the power grid."

I asked what potential he saw for solar power.

"A cost of $2 to $3 a watt in the next 10 years. We don't have the capacity now. We still have some
technology development to do. But there should be a huge payoff by 2020."

Why that long?

"Because it will take that long. Right now, in California, PV generation is price competitive in
certain areas."

It still has a long way to go, however, before it is a real competitor with conventional generation. (Wind
power, in contrast, is highly competitive and popular, witness the offer of small wind turbines on
Target's Web site at www.target.com.)

Significantly, Dr. Kazmerski's primary concern wasn't about the ultimate development of solar
power. It was about whether the United States would have a primary role since both Europe and
Japan were investing more in research and development, commercialization and subsidies.

In fact, producing photovoltaic cells in volume will be a major feat. "There's no doubt that it works," Ken
Zweibel told me. Mr. Zweibel is the manager of the NREL's Thin Film Partnership, a group of
companies doing thin-film research and development work for the laboratory. "The thing we
have to do is to bring the cost down and to raise the efficiency. When we started, it cost $100 a watt.
Our goal is to get it down to 50 cents a watt."

Getting that 200-fold increase won't be easy. While Intel can sell 1 square centimeter of
semiconductor chip for hundreds of dollars, competitive photovoltaic cells will have to be
produced at the price of good carpeting -- at a low cost per square yard, not a high cost per square
centimeter. Getting there will require very large production volumes.

"You have to produce everything cheaply at an incredibly high yield. The good news is that we're
actually getting there," Mr. Zweibel said.

We can get some idea of what might be called the Practicality Gap by comparing current household
spending for electric power to the installed cost of current photovoltaic systems. According to the
Statistical Abstract of the United States, a typical household uses about 10,000 kilowatt hours a year,
or 833 kwh per month. With a range of utility rates between 7 cents and 10 cents a kilowatt-hour, that
equates to monthly bills of $58 to $83. That, in turn, would require an annuity investment of $7,500 to
$10,700 to provide the income for 20 years, if money earns 7 percent. (Comparative calculations
need to be made this way because when you install a photovoltaic system you are, in effect, buying a
"solar annuity" of electric power with a lump-sum investment.)

Using installation cost figures from an issue of Home Power magazine, a comparable photovoltaic
investment would require more than $40,000. So installed solar system costs will have to decline
roughly 75 percent before solar power becomes a financially qualified competitor.

You can, of course, reduce the size (and cost) of the installed system by minimizing your home
power consumption with efficient appliances, efficient lightbulbs, skylights, etc.

But it will still cost about four times as much to displace the last kilowatt-hours of conventional
power.

Does the difference matter?

To most people, yes. But many consumers are jumping the Practicality Gap. Home power is a
growth industry right now.

You can learn more at the National Renewable Energy Laboratory's Web site at www.nrel.gov.)