Coming Soon: Solar Power Grid Parity
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I'm a big fan of solar power. I like the idea of a solar panel on every rooftop. It just makes too much sense not to do it - eventually. You see, the challenge to this idea is the current cost of energy from solar power which was estimated in 2007 to be between $700 and $1,700 per mWh (compared to $43 to $62 per mWh for large-hydro). So, in using current solar technology available and without significant subsidies, solar powering the grid is far too expensive to be feasible in Canada. In Germany however, where it is certainly not any sunnier than much of Canada, solar power has been very successful for two main reasons, a generous feed-in tariff program and a general willingness by Germans to pay higher costs for energy from renewable sources, like solar.
That is why it was interesting to see an article in the Toronto Star recently reporting that grid parity in Canada for solar power could come very soon. The Canadian Solar Industries Association Solar Conference 2008 held last week in Toronto, was told by Navigant Consulting that utility-scale solar photovoltaic projects could reach "grid parity" without subsidies between 2020 and 2023 if fossil fuel prices increase as expected and if, under an emissions trading regime, carbon dioxide is priced at $70 per tonne. I admit those are two very very big "if's".
Since we can't count on $200+ oil and the world community agreeing on a suitable price for carbon anytime soon, government subsidies are badly needed to further develop the solar power industry in Canada. Perhaps this is a job for Green Bonds, as we previously blogged about on Megawatt, which could provide the base for a public incentive program. With advancements in solar panel technology and increasing demand around the world for renewable power there is a real opportunity here. It's just a matter of finding the leadership to do it.
