Strong growth seen in solar and wind power

SOLAR and wind power generation is soaring at home and abroad as falling costs combine with rising prices for fossil-fuel alternatives to reshape electricity markets.

SOLAR and wind power generation is soaring at home and abroad as falling costs combine with rising prices for fossil-fuel alternatives to reshape electricity markets.

Australians installed about 1 gigawatt of solar photovoltaic (PV) panels on their roofs last year, increasing the existing capacity by more than two-thirds, according to the Australian Solar Council.

Queensland more than doubled its PV sales in the rush to take advantage of generous feed-in tariffs, adding almost 400 megawatts of capacity last year. Victorians also came close to doubling PV capacity, while NSW increased capacity by about a third.

Wholesale prices for solar PV are down to as low as 55 cents a watt from an average of about $7 in 2008, the chief executive of the Australian Solar Council, John Grimes, said.

"With the degree of competition we have, and with consolidation between manufacturers, I think we will see prices continue at this level for some time," he said. "There is some prospect they will reduce slightly."

Mr Grimes said the PV take-up levels this year could be close to last year. That estimate compares with the Clean Energy Council's forecast of a pull-back as government solar schemes are wound back or closed.

"Following a bumper year in 2012, we still expect in excess of 500 megawatts of new solar capacity to be added in 2013, with similar figures forecast for 2014 and 2015," the council's policy director, Russell Marsh, said

Ray Wills, an adjunct professor at the School of Earth and Environment at the University of Western Australia, said solar installations in Australia now exceed 955,000 rooftops and will probably pass 1 million later this month. "Anyone paying more than 25 cents per kilowatt-hour for electricity - and that is most of us - will pay back their investment in less than four years," he said.

The rapid growth of solar PV is a worldwide phenomenon as output from Chinese manufacturers soars. Global capacity topped 100 gigawatts last year, rising more than 40 per cent, according to the European Photovoltaic Industry Association.

"Over its lifetime, [solar PV] is not far away from what people call 'socket parity', or 'grid parity," Mike Sandiford, director of the Melbourne Energy Institute, said.

The convergence of grid and solar prices across Australia is "going to happen some time mid-decade," Professor Sandiford said.

"PV [pricing] has been trending down with a 20-25 per cent cost reduction for every doubling of capacity globally."

Wind energy also continues to expand with worldwide capacity soaring 19 per cent last year as 44.7 gigawatts were added, according to the Global Wind Energy Council.

Australia added 358 megawatts of new wind capacity, lifting the total by 16 per cent to 2.584GW with 62 wind farms in operation.

"Eleven projects are currently under construction and are expected to add another 638 megawatts of capacity in 2013, and approximately 1000 megawatts [will be added] in the following two years," the Clean Energy Council's Mr Marsh said.

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