Solar to lead the way as leading renewable technology to 2050 says IEA

by Felix von Geyer

Twenty-seven percent of the world’s primary energy supply should come from two-types of solar technology by 2050, the International Energy Agency said Monday in its new Technology Roadmaps.

The Paris-based organization said solar photovoltaic energy (PV) will lead the way at least until 2030 by which time solar thermal energy (STE) such as Concentrated Solar Power (CSP) that uses the sun to heat towers of water that produce steam to drive turbines will be increasingly deployed.

Since 2010, the world has added more solar PV capacity than in the previous four decades taking global to over 150 gigawatts GW in early 2014. China is expected to lead the way in deploying solar PV that globally will grow at a rate of 100 Megawatts per day. Over half of this capacity is at the site of consumption such as residential, commercial and industrial. By the time solar PV comprises up to 15 percent of global primary demand, STE is expected to expand, particularly in very sunlit areas with clear skies, making STE a major opportunity for Africa, India, the Middle East and the United States.

To achieve the roadmap’s projections, total installed PV capacity must increase from 36 GW in 2013 to 124 GW per year on average, possibly peaking at 200 GW per year between 2025 and 2040. PV electricity costs will likely converge in different parts of the world as markets develop, with projected average cost reductions of 25% by 2020, 45% by 2030, and 65% by 2050 spreading the costs of PV between $40 to 160 per MW/hour at an assumed cost of capital of 8%.

However, to prevent stop-start cycles in solar investment that prevent solar achieving so-called ‘socket parity’ between prices for solar electricity and electricity from conventional energy grids, IEA Executive Director Maria van der Hoeven stated that “We want to be read by governments and we want this to be used by governments” during a press conference. This would require governments to adopt three policies: a long-term approach; market design that includes fair rules for residential and commercial use in a system approach; and to de-risk finance by reducing capital expenditure by lowering the cost of capital, said van der Hoeven.

Global fossil fuel subsidies are worth over $500 billion annually, prompting van der Hoeven to state that countries are “burning their oil, burning their gas and burning their money” whereas socket parity has already occurred without any subsidies.

Consequently greater investment in solar, particularly into STE technology and roll-out could also help generate alternative fuels. In September, an International Civil Aviation Organization seminar on Fuelling Aviation with Green Technology estimated that Solar to Liquids technology that used solar energy to separate hydrogen and oxygen from water and create a synthetic gas for aviation fuel could be produced for as little as $1.30 per litre.