Optimistic predictions for the overall growth of the global solar industry

Each month in 2021 seems all but guaranteed to generate a new set of landmark achievements, innovations and optimistic predictions for the overall growth of the global solar industry. This month is no different, as new project agreements, efficiency milestones and tantalising tech breakthroughs are all in evidence.

However, it’s not all sunny news this month, as several major supply chain issues have cast a shadow over two decades of ambitious growth for the industry. This emerging trend is still being assessed in terms of its potential to affect solar deployments in the long-term, with solar advocates and opponents both keen to play it down or up accordingly.

Whatever the long-term ramifications, this challenge is still set against a backdrop of solar progression this month. So, while there’s a definite note of caution in the air, currently it’s not enough to translate into a major slowdown in solar adoption.

Polysilicon, an ultra-refined form of silicon, is at the heart of the current solar module price crisis. The worldwide surge of announced and initiated solar projects in the past year has resulted in a demand spike for polysilicon, as it is the crucial ultra-conductive material necessary to produce solar panels.

Clearly, demand levels are now at the point where polysilicon producers simply haven’t been able to keep up. Bloomberg notes that polysilicon prices recently hit $25.88 a kilogram, more than quadrupling from their price point of $6.19 less than a year ago. This has led to an 18% price rise of solar module prices globally – representing a hard, jolting reversal of the 90% price drop experienced over the past decade.

Similarly, prices for steel, aluminium and copper (all vital solar module materials) are all increasing as the expanding solar project pipeline places increasing pressure on suppliers.

While these problems are starting to bite – prompting delays and shelving of projects in various regions – many industry analysts suggests that this can and should be viewed as a short-term situation, one that will be rectified by rising production. They point to the fact that demand for boosting solar capacity is unlikely to drop in any meaningful global sense, due to the combination of rising solar cell efficiency and the undeniable environmental imperative of reducing our reliance on hydrocarbons for power generation.

The Middle East continues to demonstrate its commitment to solar, announcing further plans that support the increasingly ambitious targets set by respective ME governments as part of their economic diversification and environmental sustainability strategies. Nowhere else in the world is seeing opportunity, investment, innovation and public sector support come together quite like the Middle East. Even so, the clock is ticking on the region’s demanding deployment schedule: to hit its renewable energy goals, the Middle East needs to realise 50 GW of solar PV capacity by the end of this decade.

Accordingly, we’re seeing respective ME nations stick to announced plans for solar projects, suggesting that the current price hikes on key materials are unlikely to prompt significant delays. From the fourth and fifth phases of the UAE’s expansion of solar PV capacity in Mohammed Bin Rashid Al Maktoum Solar Park, to Saudi Arabia’s seven new PPA agreements for solar projects, the regional solar outlook still seems sunny.

While the more recent achievement of economies of scale has proven essential in bringing solar costs down, the mainstay of dropping prices of produced solar energy is innovation. New breakthroughs continue to drive efficiency levels up, as well as opening up new opportunities for scalable deployments of all sizes.

While headline project announcements of impressive new solar facilities are key for sustaining the industry’s momentum, this month we’re seeing a number of important smaller initiatives and innovations that demonstrate how solar’s presence can be spread beyond the big farms.

Solar sidewalks: Even though cities are growing, rooftop space isn’t always suitable for utility-scale solar deployments. A small but important development occurring in cities across the world is the use of solar sidewalks. Their key advantages are that they don’t take up valuable space and they’re much easier to maintain than rooftop-mounted panels. Barcelona City Council has just installed Spain’s first photovoltaic (PV) pavement, which is predicted to generate 7,560kWh of energy a year, enough for three households. A humble beginning, but this pilot project may pave the way for bigger things.

Solar umbrellas: If you want to stay cool at the beach and generate power, you wish is granted this month. Italian innovation company Carlo Ratti Associati (CRA) has teamed up with ice-cream-maker Sammontana to create an umbrella with solar panels covering its upper side. The captured solar energy feeds coolers on the underside of the umbrella, giving beachgoers shade and cooler air at the same time, all carbon-free. Its designers see it as a modular system; multiple umbrellas can be deployed together to optimise the coverage across a stretch of beachfront.

Solar algae farm: Italy’s Enel Green Power and Enea have teamed up to launch a pilot plant that will combine microalgae farming with solar energy. Their trial of this pioneering “algovoltaic” approach could demonstrate the case for shared land use between the two green technologies.

The response to the rather stark price rise of solar modules this month is telling for two reasons. Firstly, it underlines the fact that the global energy transition to renewables was never going to be an entirely smooth (or fast) journey. The sudden reverses of plummeting solar costs have served as a painful reminder that changes occurring at the global industry level always come with significant growing pains.

Secondly, and perhaps more importantly, the willingness of both private and public sectors in multiple key regions to absorb these higher costs and press on with their solar project timetables demonstrates that solar adoption is being driven by more than financial opportunism. Investment in solar production capacity has clearly moved on from being a speculative venture; the longer-established trends of falling costs and rising efficiency rates make solar the premier vehicle for transitioning away from hydrocarbon reliance.

For the Middle East, as with the rest of the world, this transition is essential for the viability of its economy and liveable environment for future generations. Accordingly, the drive to ramp up solar production remains as economically and politically important as ever.

https://www.bloomberg.com/news/articles/2021-05-23/solar-power-s-decade-of-falling-costs-is-thrown-into-reverse

https://www.forbes.com/sites/michaellynch/2021/06/30/whither-the-cost-of-solar-power/?sh=79d148181c2d

https://www.pv-magazine.com/2021/06/25/strong-growth-predicted-for-middle-eastern-solar-pv/

https://www.pv-magazine.com/2020/07/29/remote-operation-for-900-mw-fifth-phase-of-dubai-solar-field/

https://www.pv-magazine.com/2021/05/13/saudi-arabias-1-gw-solar-tender-invites-bids-by-june-3/

https://www.power-technology.com/features/paving-the-way-are-solar-sidewalks-a-viable-way-to-decarbonise-our-cities/

https://www.pv-magazine.com/2021/07/05/solar-beach-umbrella-cools-you-and-your-gelato/

https://innovationorigins.com/en/italy-integrates-algae-farm-with-solar-farm/