Tag Archives: supply

Solar shakeout

Solar companies are shaking out just like car and computer companies before them. Dozens of automobile manufacturers shook out to a handful of major ones; Tesla is the first new one in decades. So many computer hardware and software companies went under or were bought by bigger ones that it would take a very long blog post to list them all; I could name a dozen or two off the top of my head. There’s a shakeout going on right now among mobile phone manufacturers: even mighty Nokia is sinking. The solar industry is going through that same normal shakeout phase. Will electric utilities be next?

Stephen Lacey wrote for greentechsolar 23 April 2013, Four Must-See Charts on the Future of the Global Solar Market: Who will be left standing when the dust settles?

In 2009, after Spain’s market collapsed and the world faced a crippling financial crisis, GTM Research predicted a shake-out in the manufacturing sector. But unexpected growth in global demand, particularly in European markets, helped keep many producers afloat.

Then, in 2010 and 2011, we saw a surge of new manufacturing capacity — much of it driven by China — that created the structural oversupply faced by the industry today. As illustrated by the growing list of deceased solar companies and acquisitions, the delayed shake-out in the industry is now well underway.

This morning at the GTM Solar Summit, Shayle Kann, vice president of research, shared his outlook on consolidation, module prices, and the shifting global demand through 2016. Here are four charts from his presentation that provide a glimpse of what the world may look like in the next three years.

In 2010, when the period of irrational growth began in solar manufacturing, there were 357 active module producers.

By the end of this year, that number will be down to 145. And in 2016, it will drop below 100. (So if you’re at a conference talking to a person involved in manufacturing, there’s a good chance he or she might be out of a job or working for a different firm the next time you see them.)

He then predicts that solar PV panel prices may actually rise briefly due to fewer manufacturers. However, as he notes, demand will keep going up. And demand combined with economies of scale may make prices continue down with Moore’s Law. I think his installed capacity graph is way too conservative, because he doesn’t go back far enough, which would reveal that 2010 growth is not an anomaly, it’s a steady continuation of the previous decade (well, except in Georgia). We shall see what happens in the next few years.

One thing’s for certain: a few bankruptcies are not a problem for the world’s fastest-growing industry. They are merely a symptom of any industry growing that fast. Solar panels will continue to spread, ever-faster, and electric utilities need to adapt or soon their big utility shakeout will start, too. The utility shakeout may look more like an increase in companies, as many solar installers and vendors move in to handle distributed solar power if the incumbents won’t do it. That’s my speculation, and again we’ll see.

-jsq

Powering North Carolina with wind, sun, and water

Here's some hard evidence of FERC Chairman Jon Wellinghoff's assertion back in 2009 that baseload is outdated, we don't need any new nukes or coal, because we can get all the new power we need from sun and wind. This study from North Carolina goes further: we don't need coal or nukes at all.

John Blackburn, Ph.D. wrote a report March 2010, Matching Utility Loads with Solar and Wind Power in North Carolina: Dealing with Intermittent Electricity Sources,

Takoma Park, Maryland, and Durham, North Carolina, March 4, 2010: Solar and wind power can supply the vast majority of North Carolina's electricity needs, according to a major report released today. Combined with generation from hydroelectric and other renewable sources, such as landfill gas, only six percent of electricity would have to be purchased from outside the system or produced at conventional plants.

Hourly Power Generation and Load for a sample day in July

"Even though the wind does not blow nor the sun shine all the time, careful management, readily available storage and other renewable sources, can produce nearly all the electricity North Carolinians consume," explained Dr. John Blackburn, the study's author. Dr. Blackburn is Professor Emeritus of Economics and former Chancellor at Duke University.

"Critics of renewable power point out that solar and wind sources are intermittent," Dr. Blackburn continued. "The truth is that solar and wind are complementary in North Carolina. Wind speeds are usually higher at night than in the daytime. They also blow faster in winter than summer. Solar generation, on the other hand, takes place in the daytime. Sunlight is only half as strong in winter as in summertime. Drawing wind power from different areas — the coast, mountains, the sounds or the ocean — reduces variations in generation. Using wind and solar in tandem is even more reliable. Together, they can generate three-fourths of the state's electricity. When hydroelectric and other renewable sources are added, the gap to be filled is surprisingly small. Only six percent of North Carolina's electricity would have to come from conventional power plants or from other systems."

Six percent is a small number. That means most coal plants could be shut down, and no nukes are needed.

Continue reading →

FERC and energy demand response

Beyond a smart grid to mix and match the supply solar and wind to get rid of any need for new coal or nuclear plants, as FERC Chairman Jon Wellinghoff recommended three years ago, FERC also has plans to mix and match demand. Energy customers can volunteer to shut off their air conditioners or clothes dryers automatically if there’s not enough supply. This could facilitate adding solar power, by basically acknowledging that it may not always supply a fixed capacity.

Todd Griset wrote for law firm PretiFlaherty 23 April 2012, FERC seeks demand response standards,

Demand response, an innovative strategy to ensuring the integrity of electric grids, is growing in popularity, prompting federal regulators to consider standardizing how demand response performance is measured.

Managing an electric grid entails ensuring a constant balance between electric generation and customer demand for electricity. As customer demand rises, grid operators have traditionally called on more and more generating units. In most markets, grid operators dispatch the lowest-cost units first to keep overall costs down. As a result, generating units needed to meet peak demand tend to be more expensive than baseload generation. Many peaking units also emit more pollutants per unit of energy than baseload units.

In a demand response program, customers can volunteer to be available to reduce their load during times of peak demand. When done right, this reduction in customer demand can play much the same role as dispatching additional generation, but at a lower cost in dollars and environmental impacts. Energy efficiency resources can also play a similar role.

The U.S. Congress and the Federal Energy Regulatory Commission have both recognized that demand response can be a decentralized, crowd-sourced alternative to peaking power plants. Utilities and regional transmission organizations across the nation are implementing demand response programs.

Across the nation…. How about it, Georgia Power, and Georgia EMCs? How are your demand response programs coming?

-jsq