...Thanks to falling costs, easy construction, and flexibility, solar power installations are being built everywhere from China to the United States.
LE MONDE BY LUC BRONNER, MARCH 19, 2023 Workers have been installing a solar panel on average every two minutes at the massive Al Dhafra solar power plant, south of Abu Dhabi. Launched in 2020 by a consortium of the French EDF Renewables, the Chinese Jinko Power and Emirati public operators, the construction site is nearing completion. With 4 million solar panels and an installed capacity of 2 gigawatts (GW), it is one of the largest in the world. The electricity that it will generate for the next 30 years – enough to power 160,000 homes – has already been bought up.
Solar panels can be seen everywhere: in the middle of desert areas, on private roofs, in parking lots, above warehouses and factories, on lakes, at the edge of highways and on agricultural land as well as in cleared forests. They are now being installed at an unprecedented rate across the globe due to the breathtaking speed at which photovoltaic technology is expanding its reach. According to the International Energy Agency (IEA), solar power is expected to account for 2,350 GW worth of potential power worldwide within four years, surpassing hydroelectricity in 2024, natural gas in 2026 and coal in 2027 in terms of electricity production.
In 2021, the sun – which by its nature can only provide energy during the day – accounted for 1,000 terawatt-hours (TWh) of electricity worldwide out of 27,000 TWh consumed (from nuclear, hydroelectric, wind, etc.). Solar power's share for 2022 is on track to exceed 25%, spurred by the fight against climate change and the rise in energy prices, in a trend that is only expected to continue rising. In its annual Renewable Energy Report, the IAE concludes that despite currently higher capital costs due to raw material prices, large-scale solar photovoltaics is the cheapest option for new electricity generation in a large majority of countries around the world. "The cost of solar has dropped," said Bruno Bensasson, CEO of EDF Renewables. "What had appeared to be an expensive product just for rich countries has become competitive for all the world's economies."
Accelerating the transition
Most major industrialized countries have broken their own records in 2022 or will break them in 2023: in new power plants installed, in energy produced or in projects scheduled for the next few years. "The energy crisis we are experiencing has accelerated the transition to renewables that we were having difficulty making for reasons of climate alone," said Richard Loyen, one of France's leading experts and the president of Enerplan, an organization of professionals in the field.
Take China: 87.4 GW of solar capacity was installed in 2022, per the National Energy Administration, far exceeding the previous record of 54.9 GW in 2021. The figure could have been even higher if supply difficulties had not slowed production. For 2023 and the ensuing seven years, Chinese manufacturers expect between 95 to 120 GW of capacity to be installed annually around the country. Chinese companies have also been investing abroad, as demonstrated by an agreement with Uzbekistan, announced in mid-February, for the development of 2 gigawatts of panels within a few months. Nonetheless, this progress only marginally offsets the impact of carbon-based energy (gas and coal) in this country with enormous energy demands.
The trend has also been stunning in the United States, particularly in states like California and Texas. The Inflation Reduction Act (IRA), championed by President Joe Biden as accelerating the energy transition and promoting the country's reindustrialization, will further intensify efforts. For 2023, the US Energy Information Agency has announced projects representing 29 GW, nearly triple the figures from 2020. A study by Princeton University has suggested that growth will continue, equating to 75 and 105 GW from panels to be installed in 2026 and 2027 thanks to IRA funding, with thousands of potential new jobs.
Nuclear lobby
The same applies to Brazil and India and also across Europe (an additional 41 GW installed). Germany (7.9 GW), Spain (7.5), Poland (4.9) and the Netherlands (4) have experienced particularly significant increases. In the Netherlands, solar accounted for 14% of electricity consumption over the year, a record in Europe, even though the country experiences less sunlight than the continent's southern nations do. "The Netherlands has shown that simple and effective policies can promote the growth of solar," according to the think tank Ember Climate, calling attention to an increase in the number of rooftop installations.
France appears to be moving in the opposite direction. In 2022, 2.6 GW worth of solar panels were installed, a figure lower than that for 2021 (2.8 GW). "In the context of inflation, where many projects seemed to have become stymied, we've finally had a rather good year, even if it is not entirely satisfactory," said associates of Minister for Energy Transition Agnès Pannier-Runacher, in an attempt to put things into perspective. There are several reasons for the lag in France. First, there is the role played by nuclear power, a decarbonized form of energy that has supplied energy companies with a reason for not advancing in solar as quickly as they do in other countries. Then there were the mishaps that France experienced in the 2000s, when the development of photovoltaic panels was subsidized at a considerable cost. This put the Ministry of Finance in a difficult situation and gave the nuclear lobby additional arguments not to make solar energy a priority. It is true that photovoltaic energy accounted for 4.2% of national electricity consumption in 2022, or 4 TWh more than in 2021. At the same time, in order to cope with a shortfall of nuclear power, gas production increased by 11 TWh and imports by 30 TWh, according to RTE, which manages high-voltage lines in France.
The French Renewable Energy Acceleration Bill, adopted in January, marks an important but inadequate step in the view of industry players. To meet France's commitments, 4.4 GW of solar power must be in place by 2023. "To keep up with the pace of the PPE [multi-year energy plan] and terms outlined by the president [Emmanuel Macron] in his speech on energy in Belfort [in February 2022], we must therefore aim for more than 3 GW per year by 2028. It's a challenge, but we can do it," said the office of the minister for energy transition. According to RTE, 16 GW from solar projects were pending installation as of early 2023, a figure that has never before been reached. Consequently, when making its projections, RTE will explore a scenario in which the growth of solar could even exceed 7 GW per year.For its part, the government intends to promote individual usage by households or small businesses, just as the Spanish have done on a major scale. "Rather than having a tariff shield, in the face of the energy crisis, they have promoted home consumption from rooftop solar installations," said Loyen.
A tall order
The other issue is the manufacturing of panels. With solar's emergence as a strategic energy source, the ability to produce its components has become a matter of sovereignty. Yet, according to the IEA, more than 80% of the various components come from China, whether it be silicon, cells, panels or other parts. "China’s investment in clean energy supply chains has been instrumental in bringing down costs worldwide for key technologies, with multiple benefits for clean energy transitions. At the same time, the level of geographical concentration in global supply chains also creates potential challenges that governments need to address," said the IEA. The challenge is a global one. Biden, through the IRA, is seeking to attract investors and relocate some industrial production. India has ambitions to build giant factories. In Europe, the European Commission has launched a solar industry alliance to increase panel production from 4 to 30 GW by 2025.
The hurdle is especially high for the European continent. One of China's leading manufacturers, Longi Green Energy Technology, announced in early February that it was planning a $6.7 billion investment to double its manufacturing capacity. Within a rather short time frame, the new plant could produce an additional 50 GW of solar cells per year. In comparison, Europeans welcomed the announcement by Enel (an Italian energy company at the forefront of renewable energy) of a €600 million investment to support a 15-fold increase in production at a plant in Sicily. By 2025, this plant will be the largest in Europe... with an expected 3 GW.
The challenge of connecting to the grid
EDF Renewables holds Photowatt, a pioneering panel production company in its portfolio, but is looking to sell it. The company is losing €30 million a year, EDF Renewables CEO Bensasson said at his hearing before the parliamentary commission of inquiry into France's energy sovereignty. Projects are being developed, such as the one backed by Carbon, a company that announced on March 3 that it wanted to set up a multi-gigawatt cell and panel factory by 2025 on an industrial site in Fos-sur-Mer, in southern France. Pierre-Emmanuel Martin, one of the company's founders, said, "The Germans and the Chinese are leading the way today. We're starting from a long way back in terms of industry. But solar energy is booming around the world and we want to position ourselves on the international market."
The issue goes far beyond the energy crisis and the consequences of the war in Ukraine. All projections have pointed to a huge increase in global electricity consumption due to the development of battery-powered vehicles and the gradual decarbonization of industry. "The progress underway could increase demand faster this decade than most experts had envisioned," the think tank Ember noted in its latest report. Most of this increase is expected to be absorbed by renewables, especially solar, which is easier to install.
That is, provided that the millions of new panels are able to be connected to electrical transmission networks. Bill Gates, whose first student job was writing software for one of the power grids in the US, sees this as a critical issue for the energy transition. "Right now, over 1,000 gigawatts worth of potential clean energy projects are waiting for approval − about the current size of the entire US grid − and the primary reason for the bottleneck is the lack of transmission," he wrote in late January on his public blog.