Thread by @solar_chase

1. Time to make 2021 minor updates to my annual “opinions on #solar” thread.

If you like these, you’ll like my 2019 book, Solar Power Finance Without the Jargon, a little old but still valid, five stars on Amazon.
tinyurl.com/y6lc3ohl

2. Solar Power Finance Without the Jargon is for STEM-educated people interested or seeking to work in renewable energy planning or finance.

Link to 2021 thread. 2020, 2019, 2018 and 2017 are linked from there so you can see what I got wrong or changed. tinyurl.com/mpd2rpcx

3. To opinions! Solar is the cheapest source of bulk electricity in many countries, and one of the quickest to deploy, which in the 2022 global energy crisis has been invaluable.

The limits to PV build this year have been supply, installation labour, grid access and permitting.

4. We don’t need a technology breakthrough. Today, solar developers just need a grid connection and permission to sell electricity and they’ll be off building solar plants whether it’s a good idea or not.

5. Incremental improvements continue. Now the standard solar wafer is 182mm mono, up from 166mm last year.

(Bigger wafers are a way to cut costs and increase efficiency, though some buyers have concerns about moving to a 210mm standard yet.)

6. Prices for freight, polysilicon, steel and aluminum went up in the last two years.

Freight is back down, but polysilicon is still above $37/kg (from a low of $6.3/kg in summer 2020). We expect it to drop back to $15/kg early in 2023 on increased supply.

7. In October 2021, when the standard mono module price was 27.3 US cents per W, I said it would "come back down over 1-2 years" (referring to all-time low of 19 cents in summer 2020).

It's now 25.2 cents, so we’re still waiting for further falls....

8. High input prices for solar plants have been largely irrelevant this year because electricity prices have risen much more.

However, developers that signed fixed-price power purchase agreements before 2021 have suffered badly.

9. Fixed-price power purchase agreements are a bad idea and they should always, at minimum, be index-linked to inflation and/or the currency the bank debt is borrowed in.

10. Thank goodness we’ve collectively stopped the nonsense of boasting about "lowest ever solar auction prices", most of which were Middle East opaque transfer prices or aren’t currently being built.

PV prices below $25/MWh unsubsidised were too low.

11. There’s little talk of power price cannibalisation in 2022, because most countries have been too busy worrying about very high power prices. But solar plants do still all generate power at the same time, and that will cause sunny hours to have very low power prices in future.

12. It may well be that "negative power prices for a few hours every sunny day, followed by high evening power prices when the sun goes down" is a problem solved by capitalism and batteries.

13. Russia’s invasion of Ukraine is a more significant event in the history of the energy transition than Covid-19. Europe has been rudely reminded that energy dependence is a shackle.

14. Solar manufacturing is still a bad business to be in despite three relatively good years. Competition is vicious, the newest factories have the best tech. Older manufacturers carry heavy debt for factories rapidly becoming obsolete.

15. Government support for domestic solar manufacturing is getting really trendy, but it’s a long term project. India has done it since 2013, and its firms like Vikram, Waaree and Mundra still mainly sell abroad only due to US trade restrictions on China.

16. The US Inflation Reduction Act appears to be a licence to print money for solar and hydrogen firms. An unsustainable boom in build and manufacturing is possible, though this may be muted because the US is a difficult country to do business in.

17. Europe will support a few solar factories, but is unlikely to have a united push to rely solely on domestic manufacturing.

18. You can be cynical about government and corporate net zero emissions targets if you like, but they're a lot better than no net zero emissions targets.

19. Forecasting solar build is hard when people actually pay for the results and therefore want them country by country.

It’s easy when you just extrapolate a global line, but that is not terribly useful for setting corporate strategy, and makes your clients yell at you.

20. Our PV mid forecast – the highest I could get regional analysts to agree to, while allocating most capacity to actual countries, not buffer – is only 4.2TW by 2030, rather below the 5.3TW BNEF models that we need to be on a global net-zero-by-2050 high-renewables path.

21. You want to forecast a terawatt-per-year solar market by 2030, you go for it! (We have 460GW/year in 2030).

Fair warning, you’ll have to forecast solar build in markets that currently have no plausible plans, and where country experts will tell you it will never happen.

22. In 2017, my analysis team covered 42 countries which were significant solar markets. Now we attempt to cover 144, which is a pain, and we keep finding ones we have missed. Some of these may well surprise us and make the world a terawatt market by 2030.

23. The supply chain for solar manufacturing should probably be more transparent.

This sentence is also true without the word “solar”.

24. While moving to a circular economy with 100% recycling rates is essential in the long run, it’s not a challenge for PV in particular; few PV panels have been recycled to date only because the vast majority are still in use.

It can be done.

25. I refuse to get excited about perovskites until a perovskite company can disclose a commercial partnership with a named major module manufacturer.

(This was my opinion in 2018, 2019, 2020 and 2021. It is my opinion still).

26. Floating solar is a thing, but it’s not a new tech. It’s solar onna boat.

It’s mostly about having a place to put the modules and, when it’s on a hydro dam reservoir, a grid connection right there. Grid connections are like gold dust.

27. Agrivoltaics, likewise, is solar onna field.

PV only has synergies with *some* agriculture. Competition for light and restricted mechanical access to crops are often problems. Study is needed to make sure it isn’t just subsidised bad PV and bad farming in the same place.

28. Residential and commercial solar policy worldwide are moving to paying a much lower rate for instantaneous exports than users pay for grid power, and that’s fine. The pro-solar alternatives, full net metering or even a higher feed-in tariff, are excessively generous.

29. Batteries for residential solar systems are becoming standard offers in Europe and the US. Frankly some of the sales proposals are of indifferent veracity and the current software isn’t up to economically optimising when batteries charge and discharge.

30. If you get a battery and a solar system, pay attention to when it charges and discharges and what power costs at those times! Everyone needs a hobby. (We need better control software for the residential segment).

31. Also get your rooftop solar system built when you have scaffolding up for something else, 'cos scaffolding is expensive. Ideally build it when you’re building the roof, there will never be a better time.

Rooftop solar mandates are good and should be more common.

32. Very few people who are not solar project financiers understand tax treatment for solar projects (I don’t) and it’s important enough to make most calculated LCOEs irrelevant to power purchase prices.

33. Solar thermal tower and heliostat designs are still not working well, although we’ll see how smoothly Cerro Dominador performs now it’s commissioned.

We might even end up using molten salt for multi-day and seasonal storage... but heat it with PV.

34. Utility-scale batteries became a thing much faster than I expected. 9,534MW/21,612MWh deployed in 2021, and @YayoiSekine’s team expects 16GW/34.5GWh new build in 2022.

However they are not the answer to seasonal demand-supply mismatch, as utilization rate would be very low.

35. Hydrogen made with renewable electricity will be a thing, initially for steel production and fertiliser manufacture.

Some may be made into ammonia for shipping and aviation fuel.

Some may even be burned in the power grid in weeks of low renewables.

36. ...but sometimes net-zero electricity models want to put in hydrogen to cover weeks of low renewables just because the model isn’t given any other option. Deep decarbonisation models do weird things.

It may turn out there are easier pathways in practice.

37. Heatpumps are better for heating homes than hydrogen, but in seasonal climates like northern Europe will exacerbate the seasonal demand and supply mismatch for solar.

We need to build wind and maybe nuclear as well.

38. Nuclear is safer than coal and climate change, and better than gas unless the gas plants are running very rarely. Batteries should help with the unfavourable ramping economics of nuclear (you *can* turn nuclear plants up and down, but you really don’t want to).

39. We’re finally getting serious about net zero carbon.

Getting that last 10-30% of carbon out will be hard, and require some expensive solutions. The first 70-90% is easy-ish but we're getting on with it.

40. Ordinary people have no idea how much progress we’ve made. Tell people at parties that in 2021 renewables produced 41.1% of Germany’s electricity, more than all fossil fuels (coal, gas, oil) together!

41. …It would still really help if rich people would stop pissing away carbon for no reason.

42. Solar is a major part of decarbonizing electricity, but probably not more than 50% worldwide, so we need something else too. Transport will go electric but also we really need to sort out industry, agriculture, shipping and aviation for a sustainably habitable planet.

43. Solar plant operation and maintenance in desert environments will prove more challenging than PV project stakeholders currently expect.

Climate risk from hurricanes, hailstorms, fire and floods is on the rise for solar as for everything else.

44. Traded electricity wholesale markets are the worst way of deciding how to dispatch energy resources, except for all the others that have been tried.

Price caps, windfall taxes and other complications are an unfortunate political necessity but hopefully a historical outlier.

45. Many solar project developers complaining their problem is 'finance' are being disingenuous. Their problem is, their project is rubbish and they cannot convince anyone otherwise.

This is not just a solar thing.

46. Building-integrated PV products are usually attempts to sell bad solar products for premium prices to gullible aesthetes and architects.

47. Offgrid solar is driven more by people wanting TVs than by people wanting their kids to have light to do homework. And that’s absolutely fine.

Minigrids, microgrids, and solar home systems with batteries are bringing reliable electricity to the whole world. It's happening.

48. There is enough land for lots of solar. There are enough golf courses in the U.S. for about 370GW, ffs.

There’s also loads and loads of roofs, so let’s see those who oppose ground-mounted solar support higher-cost roof-mounted solar.

49. If you’re recording PV capacity and only have room for one figure, record MW(DC). It will tell you more about what the project will produce and what it will cost than MW(AC), which is just the size of the wire.

I will die on this hill.

50. Anyone buying a new internal combustion car now is pretty silly. EVs aren’t the answer to everything – especially congestion of cities – but they do use much less energy and, with flexibility, can support the grid.

...I drafted all that and FORGOT TO CHANGE 2021 TO 2022. These are of course 2022 thoughts.

This thread has been my annual roundup of solar thoughts/ opinions, for 2022.

If you like these, you’ll like my 2019 book, Solar Power Finance Without the Jargon, a little old but still valid, five stars on Amazon.
tinyurl.com/y6lc3ohl