In a document to be released on Monday, the International Energy Agency (IEA) is set to outline a scenario whereby solar, in all its forms, could contribute more than 50% of the world’s electricity by 2050 provided governments and industry follow a set of recommendations laid out in the IEA roadmap.
While the IEA will set out a number of scenarios, its latest Energy Technology Perspectives document will set out the possibility of a cumulative PV capacity of 4,600 GW in 2050, supplying 6,500Twh of electricity annually.
The EU PVSEC conference drew to a close today in Amsterdam, with the IEA’s Paolo Frankl providing a preview to the latest version of the organization’s Energy Technology Perspectives forecast.
Due to the rapid cost reductions achieved by PV, the IEA is now more bullish on the contribution the technology can make to global electricity and energy supply than ever before.
Importantly, Frankl set out that PV, along with solar thermal and CSP technology, could theoretically become the majority electricity source by 2050, according to IEA modeling. Beyond that total, PV will supply 16% of the world’s electricity.
"This figure [16%] represents a big increase on previous roadmaps because things have changed so quickly," said Frankl at the EU PVSEC closing event. "Based on its competitive advantage in distributed applications, PV is unbeatable by any generation technology, distributed or not."
Frankl, the IEA’s Renewable Energy Division Head, said that while solar thermal is viewed as something of a rival tothe PV sector, the two technologies are indeed complementary and will grow together. In countries like India and the U.S., the IEA anticipates that PV and solar thermal technology will increase in size at a parallel rate.
China is expected to be the world’s largest solar PV market through 2050, according to the IEA, representing 37% of global PV installed capacity.
The IEA prediction is based on a number of major challenges being met, both by the PV industry and policy makers. Driving down the cost of capital and facilitating large amounts of PV in electricity grids were pinpointed as being the major two potential bottlenecks.
"Capital cost is the main reason why solar is more expensive in Greece than in Germany," said IEA’s Frankl. "It is also why in developing countries, where the perceived risk by investors is high, sometimes requiring 15% ROI, it destroys [the business case for] PV and any other capital intensive [generating] capacity."
Looking to grid integration, Frankl and the IEA say that a "more flexible power system and market adoption" approach. This includes policy makers adopting a system approach to integration and fostering visibility in markets.
Specifically, Frankl said that more grids and more grid connectivity is required allowing for the trading of excess electricity when it is being produced. Flexible generation capacity is also important, including peaking, pumped hydro and battery storage. An increased role for Demand Response, as the lowest cost flexible capacity, is the final piece in the transition of grids to high renewable penetration as set out by the IEA.
In terms of battery storage, while acknowledging the topic was one in frequent discussion by researchers and attendees at the EU PVSEC, the IEA’s Frankl said that due to its current cost, the organization does not agree that it is "the" solution to grid flexibility issues.
Looking to prescriptive steps recommended by the IEA, Frankly said that a predicable policy framework for business is required, permitting and connecting of PV needs to be facilitated despite, the conservative nature of utilities we see everywhere in the world and more focus needs to be paid to grid integration issues.
"We must recognize that PV is no longer a niche market, said Frankl. The outlook for large amounts of PV is very bright."
EU PVSEC 2015 will be held between 14-18 September, in the German city of Hamburg.
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