22 November 2012 – For decades the story of technology has been dominated by computing and the things you can do with it. Moore’s Law — in which the price of computing power falls roughly 50% every 18 months — has powered an ever-expanding range of applications, from faxes to Facebook. Our mastery of the material world, on the other hand, has advanced much more slowly. The sources of energy, in particular, are much the same as they were a generation ago.
One of the most common and abundant sources of renewable energy is solar energy. Powerful rays from the sun are tapped and used to run electric thermal power plants. The heat energy of the sun is utilised to produce electricity in photovoltaic cells that are woven together to create solar panels. While the benefits of utilising solar energy are well known, the technology has often been seen as expensive or not viable from an economic standpoint.
“In the mid-1970s, at the height of the Middle East oil crisis, the United States started talking about a solar power revolution that would offer the hope of a cheap, endless supply of energy. The solar revolution, of course, fizzled after the crisis ended and oil became relatively cheap and plentiful again,” Trevor de Vries, MD of 3W Power/AEG Power Solutions South Africa, says. “Solar energy back in the ’70s and historically was not cost-effective. There needed to be improvements in manufacturing and in cell efficiency. However, since 1980, every time the installed capacity has doubled, prices decreased 22%.”
The economics of a photovoltaic system depend not only on the cost of designing and installing the system, which can vary considerably, but also the expense of maintaining and operating the system over the course of its serviceable lifetime, which usually spans between 25 to 30 years. The cost-effectiveness of such a system also depends on how much sun a location gets, electricity usage, and the size of the system. In comparison to conventional hydrocarbon fuels such as coal in generating electricity, the initial cost of solar energy is significantly higher. “However, if we priced coal-fired power right, taking into account the huge health, environment, and other costs it imposes, we’re just a few years from the point at which electricity from solar panels not only becomes competitive with electricity generated by burning coal, but even cheaper. As utility costs mount ever higher, solar systems that can pay for themselves in as little as a few years are becoming increasingly viable. If electricity price inflation continues at its current rate, by the time their solar PV systems are halfway to their expected life of 25 years, South African businesses would have cheaper electricity from solar if they installed right now,” de Vries says.
From a business point of view, solar systems also make more sense. These days there are many tax credits, rebate and incentive programs to help different types of organisations, from non-profits to corporations, implement clean solar power. In addition, as with renewable energy in general, the expansion of solar power can generate new jobs and promote economic growth.