Wind beat­ing so­lar in race of re­new­ables

Wind is win­ning the race for the best- value re­new­able en­ergy source, writes Keith Orchi­son

The Weekend Australian - Review - - Clean Energy -

REWIND to the oil cri­sis years of the 1970s, and the talk in en­ergy re­search cir­cles was about the po­ten­tial of wind and so­lar power. Fast­for­ward to 2008, with oil sit­ting at $ 100 per bar­rel, and the wind in­dus­try has more than 75,000 megawatts of in­stalled ca­pac­ity, with the prospect of dou­bling its par­tic­i­pa­tion in the next 25 years — while the so­lar sec­tor is still the wist­ful wannabe of the global power busi­ness with just 3000 MW of in­stalled ca­pac­ity.

For all the talk of fu­ture prospects — with the cur­rent so­lar spin claim­ing it could be de­liv­er­ing 10 per cent of world elec­tric­ity con­sump­tion by the mid­dle of the cen­tury — the harsh re­al­ity for the sec­tor is that it is still a tor­toise bat­tling its way through the re­search and demon­stra­tion phase while wind farm­ers have hared off to claim multi- bil­lion re­wards in an ever- grow­ing num­ber of coun­tries.

In Aus­tralia, with a new fed­eral gov­ern­ment com­mit­ted to in­tro­duc­ing both emis­sions trad­ing and a greatly en­larged manda­tory re­new­able en­ergy tar­get, so­lar still can­not look for­ward to a ma­jor surge in its stand­ing.

Re­search un­der­taken for the pe­tro­leum in­dus­try by con­sul­tants CRA In­ter­na­tional pre­dicts that the wind sec­tor will con­tinue to be the big win­ner here in the race for a green power mar­ket share.

CRA modelling sug­gests the twin in­cen­tives will drive five times more ben­e­fits for the the wind sec­tor in the na­tional power mar­ket than for so­lar en­ergy — pre­dict­ing that wind farms will be de­liv­er­ing al­most 44,000GWh a year in 2020 ver­sus just over 8000GWh for so­lar power.

So­lar is also in dan­ger of be­ing run over by hot rock geo­ther­mal en­ergy in the race for Aus­tralian power sales — the geo­ther­mal in­dus­try be­lieves that it can de­liver about a tenth of na­tional elec­tric­ity needs, or some 36,000GWh a year, by 2030 from the Cooper Basin and other heat min­ing sites.

The rea­son that so­lar power has not made more sub­stan­tial in­roads into the en­ergy mar­ket around the world is that it is more ex­pen­sive than just about ev­ery other way of pro­duc­ing elec­tric­ity.

In the US, for ex­am­ple, re­cent stud­ies show that so­lar pho­to­voltaic power costs con­sumers at least 25 cents per kilo­watt hour ver­sus un­der 19 cents for main­stream sup­plies from coal- fired and nu­clear power sta­tions. Rooftop so­lar pan­els cost about $ US2.50 per watt — a fig­ure that needs to drop to about $ US1 per watt to be re­ally com­mer­cially vi­able.

The buzz­word for re­new­able en­ergy ad­vo­cates is ‘‘ grid par­ity’’ — be­com­ing price com­pet­i­tive with con­ven­tional fos­sil fu­els. The Aus­tralian geo­ther­mal power in­dus­try sees na­tional emis­sions trad­ing from 2010 at $ 20 to $ 40 per tonne of car­bon diox­ide as pro­vid­ing it with the means of chal­leng­ing fos­sil fuel sup­pli­ers of baseload power. The wind sec­tor will need both trad­ing and the MRET sub­sidy to make it vi­able.

The so­lar sec­tor needs all this and more — it also wants elec­tric­ity re­tail­ers to be forced to pay a sub­sidy for ex­cess en­ergy that build­ings with rooftop so­lar ar­rays can sell into the power grid.

At the same time it con­tin­ues to need sub­stan­tial re­search and de­vel­op­ment sup­port from the tax­payer.

Un­der a scheme in­tro­duced by the Howard Gov­ern­ment, the so­lar busi­ness is be­ing sup­ported by a $ 75 mil­lion ‘‘ So­lar Cities’’ pro­gram while its sin­gle big­gest Aus­tralian ven­ture — a power plant to be de­vel­oped at Mil­dura at a cost of $ 420 mil­lion — is re­ceiv­ing al­most $ 80 mil­lion from the fed­eral Gov­ern­ment and $ 50 mil­lion from the Vic­to­rian Gov­ern­ment.

The Rudd Gov­ern­ment has also promised to spend $ 489 mil­lion on in­stalling so­lar pan­els on the roofs of Aus­tralian schools.

In­ter­na­tion­ally, gov­ern­ments in Ger­many, Italy, Spain and South Korea al­low so­lar power pro­duc­ers higher whole­sale prices — sub­sidised by cus­tomers — while in the big­gest gov­ern­ment ef­fort of all, China has been us­ing so­lar cells to help drive its elec­tri­fi­ca­tion of small towns and vil­lages in the sun­light- rich west­ern re­gions.

The Chi­nese ‘‘ Bright­ness Pro­gram’’ aims to de­liver elec­tric­ity to 23 mil­lion peo­ple cur­rently with­out power by 2010. China’s pho­to­voltaic man­u­fac­tur­ing ca­pac­ity was tripled in 2006 and dou­bled again last year.

How­ever, with an in­stalled ca­pac­ity es­ti­mated at 80 megawatts — com­pared with the na­tional to­tal of 713,000MW, 14 times big­ger than Aus­tralian gen­er­a­tion ca­pac­ity — China’s so­lar in­dus­try re­mains mi­nus­cule.

De­spite its lowly global sta­tus, the so­lar in­dus­try sees a bright fu­ture in the medium and long term, driven by the will­ing­ness of gov­ern­ments around the world to em­brace re­new­able en­ergy, high and still ris­ing con­ven­tional en­ergy prices and con­tin­ued progress in cut­ting so­lar man­u­fac­tur­ing costs and im­prov­ing power per­for­mance.

One of the world’s largest in­vestor- owned power com­pa­nies, the Vir­ginia- based AES Cor­po­ra­tion, which has 43,000 MW of gen­er­a­tion ca­pac­ity in 28 coun­tries, an­nounced last month that it was set­ting up a $ US1 bil­lion joint ven­ture for so­lar power de­vel­op­ment in Europe and Asia.

Paul Han­ra­han, chief ex­ec­u­tive of AES, which sources a fifth of its power pro­duc­tion al­ready from wind, hy­dro- elec­tric­ity and biomass, says the project with Amer­i­can private eq­uity firm River­stone Hold­ings will build so­lar plants rang­ing in size from two to 50 megawatts to feed en­ergy into high volt­age net­works.

It is, he adds, part of a $ US10 bil­lion in­vest­ment by the com­pany over 5- 10 years in re­new­able en­ergy.

In­vest­ments like this demon­strate that so­lar power has come a long way since the world was gripped by en­ergy fears in the 1970s — but the sec­tor needs to look to the hori­zon to see how far its strong­est green com­peti­tor, wind en­ergy, has raced in the same time frame.

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