The opening ceremony at this year’s Intersolar North America set the stage for some of the main themes at the conference. And as usual, it set an upbeat tone. As JB Straubel, CTO and Co-Founder of Tesla, put it, “There really is no going back.” He was referring to the rise of grid energy storage, which he believes will happen much faster than most people expect.
Sound familiar? As Straubel put it, “Almost no one predicted photovoltaic prices would have dropped as fast as they have, and storage is right at the cliff, heading down that price curve.”
But continuing price drops don’t apply just to storage. Even PV hasn’t finished dropping in price. Professor Eicke Weber, Chairman of Intersolar NA, noted, “In some countries we are already below 5 cents per kilowatt-hour.… We expect it to get down to 2 to 4 cents.” What does this mean for solar? “Compared to this, you can forget everything else, especially nuclear power plants.” So PV, he said, “is where the automotive sector was in 1920 or so – just at the very beginning.”
It’s an impressive beginning. In California, solar has experienced such quick growth that “every 3 minutes somebody’s going solar,” said Bernadette Del Chiaro, Executive Director of CalSEIA. [The numbers may be even more impressive if you take the most recent data into account.] What’s also significant about this, she noted, is that “the electorate is going solar.” With that kind of support, she added, “We can win.”
Evolving themes at Intersolar
He noted how Intersolar has changed over the years. “Before, it was focused on PV, thin film, technologies. Everybody talks now about financing, storage, permitting, new business models, soft cost reductions. There are still technological improvements, but for rapid deployment of solar, those aren’t the major hot topic at the show anymore. The bigger issues are in other areas.”
Financing and storage were major themes at Intersolar last year too, but this year, he said, there was even more interest. He noted that the financing symposium with SunSpec Alliance was standing-room-only, and the same was true of storage programs at the conference.
Storage, storage, and more storage
“This year we’re in a different stage with storage,” Elsaesser said. “Last year there was a lot of talk. Now the cost is coming down, it’s now in range where it makes more sense to install more storage.” While that’s especially true in California, with its mandate for utility storage, there’s a lot happening in other areas too.
“The factory in Nevada will be size of all other battery factories combined,” said Elsaesser. “We will see economies of scale – it will be the same as PV in the past, where the cost went down 75 percent in ten years. Right now, storage is at 0.1 percent; that will go up in five years to 6 to 8 percent. The first two to three years, the growth will be primarily in utility-scale and commercial, then residential will pick up.” What will it take for that to happen? “Costs need to come down further, but we’re in a good way for that. Time of use tariffs will help with that.”
The greater interest in storage was also reflected in the this year’s conference exhibition space, Elsaesser noted. That includes the Electric Energy Storage Stage, accompanying the energy storage segment – complete with its own program.
Another indication of the increased prominence of storage: At the Intersolar Europe conference, the number of storage exhibitors went from 50 last year to 330 this year. In North America, it was up from about 15 – 20 last year to 50 this year. That may double next year.
A future trend that Elsaesser expects is aggregating residential storage systems. This can help the ISO to regulate the grid, so in Germany, several companies are already offering to connect residential systems. This will be an interesting one to watch develop in the U.S.
If you’d like to learn more about solar plus storage, check out the white paper that Intersolar released at the conference in conjunction with GTM Research.
Solar’s continuing growth
It’s not just storage that’s growing, of course, but also solar itself. “It took fifteen years to install 200 gigawatts of solar worldwide, now we can do that in two to three years. Solar is still at only 1 percent of global electricity supply, so there’s a huge potential,” said Elsaesser.
What’s driving this growth? “Deutsche Bank predicts that within the next couple years, 80 percent of the world will be at grid parity. Rapid deployment and falling costs are driving each other. So it will probably go up exponentially in the future.” Soft cost decreases are helping this too. Although they’re still high in the U.S. residential solar market, a lot is being done to lower them, including streamlining permitting.
And of course, the ITC
And how would expiration of the Investment Tax Credit (ITC) affect this growth? “Analysts are saying that if the ITC expires, the market will go down for one to two years,” said Elsaesser. “After that, it will come back to the same market level. But it would hit the industry for two years. Between residential and small commercial, the residential sector will be most affected, but overall it’s the utility segment that will be affected most by the ITC. We support fighting to keep the ITC. It’s a big driver at the moment for investments in solar.”
If you’d like to help, it’s easy at Intersolar. Volunteers will scan your badge, letting you automatically sign the petition to extend the ITC.
Echoing the opening ceremony speakers, Elsaesser said, “We’re just at the beginning of development. Nothing can stop solar anymore. If the ITC goes away, that could put a lot of installers out of business, and it would be hard for them to start up again. But in the long term I’m very optimistic, especially about the residential market. It makes much more sense to have installations stay where the consumption is.”