Solar to become largest source of electricity generation by 2050
Solar energy could become the largest source of electricity generation by 2050 but only if world leaders set firm, long-term targets, the International Energy Agency (IEA) said
The IEA released two reports on 29 September which analysed the potential for ramping up capacity in solar photovoltaic (PV) systems as well as solar thermal electricity (STE) generation. The technology roadmap reports said solar PV systems had the potential to generate up to 16% of the world's electricity by 2050. Meanwhile STE, from concentrating solar power (CSP) plants, could provide an extra 11%, resulting in solar power providing almost a third of the world's electricity by that date.
In 2011, renewable energy provided around 20% - 4,482 terawatt hours (TWh) - of total global electricity generation. Hydropower provided almost 80% of this, while solar PV provided 61 TWh, just over 1%.Solar PV panels capture sunlight and convert it directly into electricity using photovoltaic cells. Solar thermal technology harnesses solar energy to generate thermal energy or electrical energy often for use in industry. Solar thermal technology power plants generate electricity indirectly using heat from the sun's rays, which is collected and used to heat water. The steam produced from the heated water powers a generator which then produces electricity.
Since 2010, the world has added more solar PV capacity than in the previous four decades. New systems were installed in 2013 at a rate of 100 megawatts (MW) of capacity per day. By early 2014 the total global capacity surpassed 150 gigawatts (GW), according to IEA figures.
For solar PV's market share to reach 16% of the global total by 2050, around 4,600GW of PV capacity needs to be installed by then. To make this happen, installation rates need to rise rapidly, from 36GW in 2013, to around 124GW per year. Between 2025 and 2040 this will need to peak at 200GW per year.
So far, solar PV development has ramped up much more quickly than STE, mainly because of falling costs. PV modules now cost around a fifth of 2008 levels while the cost of full PV systems have fallen by two thirds. IEA figures show costs for electricity generated from new built solar PV systems currently range from $90- $300 per megawatt hour (/MWh) depending on the type, size and cost of systems; maturity of markets and the costs of capital.
The IEA expects PV generation costs to continue falling as markets converge and capacity ramps up. The reports said PV generation costs will fall by around 25%, from current levels, by 2020 and 45% by 2030. By 2050 solar PV generation could cost 65% less than today. Assuming capital costs are around 8%, the IEA estimates PV generation costs will have fallen to between $40- $160/MWh by 2050. This is compared to current US gas-fired powered generation which costs between $60- $150/MWh.
Maria van der Hoeven, the IEA's executive director, said falling costs of solar PV systems have 'opened new perspectives for using solar energy' as a major source of electricity in the next few decades. However she added that both technologies remain very capital intensive. Almost all of the costs are made upfront so lowering the cost of capital investment is crucial for boosting capacity. The IEA expects global renewable power capacity to reach 2,555 GW in 2020, up from 1,690GW last year.
Renewable energy's rise has been fuelled by falling costs and environmental mandates to cut carbon emissions. Renewables are expected to account for nearly 80% of total new power generation over the next six years, the IEA said recently.
Previous solar power development has been led by European countries but this is changing rapidly as Asia and the US are now leading the renewable energy charge.
China and other non-OECD countries will lead the growth, accounting for around 70% of new renewable power generation between now and 2020. Fast-growing energy demand, increasingly cost-competitive forms of renewable energy and a need to diversify sources of supply will all drive growth. In the solar market China is expected to continue leading, accounting for about 37% of total, global capacity by 2050.
However, Van der Hoeven stressed that the rise of renewable energy capacity and solar PV in particular 'is not what will happen, rather what should happen' and that consistent government support and increased investment in new capacity will be needed. Van der Hoeven said: "Where there is a record of policy incoherence, confusing signals or stop-and-go policy cycles, investors end up paying more for their investment, consumers pays more for their energy, and some projects that are needed simply will not go ahead."
Trebling the annual amount of installed solar capacity will require investment of around $225 billion per year - more than twice last year's rate. That investment will only come from governments committing to long-term renewables targets which will lower risks for investors.
Today fossil fuels generate around 68% of global electricity generation while renewables comprise around 20% of the total. The IEA said that by 2050 these positions could be reversed with renewables making up 65-79% of total electricity generation while the share generated from fossil fuels could fall to between 12% and 20%.
Greenhouse gasses (GHGs) levels reached a record high last year as major emitters burnt more coal and the earth's ability to deal with climate changing gases appeared to wane. A recent report from the World Meteorological Organisation found that radiative forcing - the warming effect on the earth's climate - had risen 34% between 1990 and 2013 because of an accumulation of GHGs, such as carbon dioxide (CO2).
The power sector currently produces around 40% of total CO2 emissions associated with energy supply and so ramping up capacity in lower carbon fuels, such as solar PV, is essential in mitigating the effects of global warming. To ensure global warming remains within 2C, capacity ramp ups in other renewables and nuclear power will also be needed alongside greater energy efficiency and carbon capture and storage.
Van der Hoeven said global investment of $44 trillion will be needed in these low-carbon energy sources by 2050 to limit global warming. However she added this would be offset by over $150 trillion in savings on other types of fuels.
A global climate deal - where the world's largest polluters pledge to cut carbon emissions - is becoming increasing urgent after years of deadlocked talks. In September UN secretary-general Ban Ki-moon hosted a UN Climate Summit in New York which aimed to garner the political momentum to sign a legally binding deal next year. Getting the world's largest carbon emitters - the EU, China, the US and India - to sign a legally binding deal at next year's Paris climate talks will be crucial for cutting carbon emissions and boosting the share of renewables in electricity generation.
Key points from the IEA's solar PV report
- Solar PV's share of global electricity generation will reach 16% by 2050, up from around 1% in 2011.
- Since 2010, the world has added more solar PV capacity than in the previous four decades. New systems were installed in 2013 at a rate of 100MW per day. Total global capacity surpassed 150GW in early 2014.
- The geographical pattern of deployment is rapidly changing. While a few European countries, led by Germany and Italy, initiated large-scale PV development, PV systems are now expanding rapidly in China, Japan and the US.
- The cost of electricity generated from new built solar PV systems currently ranges from $90- $300/MWh depending on the solar resource; the type, size and cost of systems; maturity of markets and the costs of capital.
- China is expected to continue leading the global market, accounting for about 37% of global capacity by 2050.
- Achieving the IEA's scenario of 4600GW of installed PV capacity by 2050 would avoid emitting up to 4 gigatonnes of CO2 per year.
- Achieving this would require increasing the annually installed solar PV capacity, from 36GW in 2013 to 124GW per year. It will need to peak at 200 GW per year between 2025 and 2040.
- The cost of producing electricity from solar PV is expected to fall by 65% by 2050. Assuming capital costs are around 8% PV costs are likely to be between $40- $160/MWh.
- Investment in solar power capacity needs to reach around $225bn per year to achieve this - more than twice the rate in 2013.
- Utility-scale systems and rooftop systems will each have roughly half of the global market.
- In the last few years, manufacturing of PV systems has been concentrated in Asia, particularly in China and Chinese Taipei, mainly based on economies of scale in large new production facilities. Future progress is likely to be driven by technology innovation opening up the possibility of global deployment of manufacturing capabilities.