The pv magazine weekly news digest

The 2015 Intersolar Europe conference and exhibition took place in Munich, Germany from June 9 to 12. The opening press conference of the exhibition outlined a varied program that has evolved to bring storage technology – including stationary systems and e-mobility – even further under the Intersolar umbrella.

The EES Europe exhibition, which runs concurrently with the Intersolar Show, has grown five-fold on last year, with an entire hall at the Munich Convention Center given over to advancements in storage systems, applications and innovations.

Overall, 326 exhibitors were expected to showcase either storage or integrated storage with inverter products at the show, of which 158 are storage-specific companies, according to Intersolar founder Markus Elsässer.

Growth was more stunted among the solar PV industry, with the 40,000 expected visitors and 1,000 exhibitors estimated slightly down on last year, which was already a notably lower-key show compared to years past.

Storage impacts

The topic of storage was also addressed in a new report issued by strategy consultants, Roland Berger. Talking about the potential future of solar energy, the report’s authors said that to increase the self-consumption ratio, and thus solar’s attractiveness for households, such solutions as energy storage and demand-side management need to be widely employed.

Most battery systems cost around $800/kWh today (although Tesla has said its Powerwall system will be more like $500/kWh after inverter costs and installation). By 2025, says Roland Berger, costs could fall to $200/kWh.

"Currently, battery storage would add another USD 0.14/kWh to the LCOE, but this is expected to drop to only USD 0.02/kWh within five years. In Germany, in fact, household solar PV and battery storage will reach grid parity by 2016," said the report.

Storage roadmap

A new roadmap released on June 9 at the International Renewable Energy Agency’s (IRENA) ninth IRENA Council meeting set out a pathway for the advancement of renewable energy supported by battery storage.

The Remap 2030 program has prioritized 14 action items across five priority areas IRENA feels are paramount to effecting lasting change for the energy landscape. The Remap 2030 report posits that, in order to avoid the worst effects of climate change and accelerate the global transition towards more sustainable power generation, the share of renewables in the electricity sector needs to reach 45% by 2030.

Amid the many pathways towards this goal, the one signposted ‘Storage’ is going to prove most pivotal, IRENA adds, stating that around 150 GW of battery storage – alongside a further 325 GW of pumped-storage hydroelectricity – will be required.

"Now is the time to think about integrating large-scale battery storage into the global energy system," said IRENA director-general Adnan-Z Amin.

New deals

Stepping up to the challenge, the solar industry has seen a number of announcements detailing new storage partnerships and initiatives over the past months. This week, independent energy advisory and certification body DNV GL announced it is to create a solar + storage division to address burgeoning industry challenges.

DNV GL is confident its new dedicated division can deliver independent advice, analysis, engineering and testing services to clients and customers operating in both industries.

Germany’s Sonnenbatterie GmbH, meanwhile, has opened an R&D facility in Georgia. Research will focus on next generation smart energy storage devices. Twelve to 15 engineers will work on expanding the company’s current array of next generation smart energy storage devices, which are sold to both homeowners and businesses.

The R&D facility, based in Atlanta, Georgia, will be spread across 5,000 square feet. "The new Atlanta facility will be the center for product development, prototyping, and testing for the US market," explained Sonnenbatterie.

Changing utilities

At Intersolar, Carsten Kornig of German Solar Association, BSW, said he is expecting a second solar gold-rush in Europe over the next few years as the energy has become cheaper than conventional sources of power in many places. "Data from Deutsche Bank has solar PV at $0.10-$0.15 per kilowatt hour in Germany, and solar is the cheapest source of energy in many countries around the world," he said. By 2050, solar is likely to be below $0.05/kWh, according to BSW data based on research from Fraunhofer.

The Roland Berger report went on to say that solar is becoming a "game changer" for utilities, due to its decentralized model. Predictions are that by 2030, solar could account for 12%, or 147 GW of Europe’s total electricity production.

While there are challenges for utilities in terms of preparing for both lower energy transition volumes and peak loads, new opportunities will be available for them, in the form of energy delivery and services.

Falling costs

Decreasing costs have seen solar’s uptake increase, continued Roland Berger, mirroring SolarPower Europe’s position in its latest "Global Market Outlook for Solar Power 2015-2019" report.

The "massive" price declines have help solar become a cost-competitive energy source, including a 75% drop in PV system prices in the past decade. As such, it should be viewed as a "low risk investment" by the financial community, said the association.

The report added that in several European countries, PV system prices of €1/Wp for installations over one MW below are common, while for competitive tenders, prices of around US$1/Wp are not unusual. Declining module prices outside of Europe have helped to lower costs – minimum import prices on Chinese modules to the EU "have maintained prices at a higher than market level" – as have falling prices for inverters.

Falling inverter revenues

Talking about inverters, analysts at IHS have revealed that the Chinese PV inverter market expanded by 18% in 2014, with shipments for the year pushing the market to a cumulative 13.3 GW of alternate current.

However, over that same period, revenues fell by 6% as price declines across the inverter industry continued. Such was the ferocity of the price pressure that many smaller suppliers previously operating in China’s competitive inverter market have folded, while the largest-two suppliers – the well established Sungrow and the relative newcomer Huawei – increased their market share considerably.

Sungrow unveiled a new series of inverters at this week’s Intersolar Europe Exhibition that the company claims are 99% efficient. The new string inverters have a power rating between 20 kW and 80 kW, and have been developed by the company’s in-house R&D team to be suitable for commercial buildings as well as utility-scale installations.

Recordbreaking

In a record year, the solar industry saw 40 GW of PV installed globally in 2014. This year is set to see more records broken, with the PV Market Alliance predicting cumulative PV installations of 50 GW in 2015.

Overall, global solar market growth up to 2020 will be uncertain, but PV capacity could reach between 70 to 90 GW in 2020, say analysts. The right frameworks and market design need to be in place. If not, the market could stumble, said the association earlier in the week in its comments on growing the solar market to 2020.

Utility-scale solar is expected to drive growth, due to its increased cost competitiveness. In the rooftop sector, self-consumption is said to be becoming the "backbone" of distributed PV development.

Geographical changes

Marking a significant change from just three years ago, Japan, which connected around 9.7 GW of PV in 2014 is set to boost global solar growth, as is the U.S., which added over 6.5 GW last year. In Q1 2015, it installed 1.3 GW, according to figures from the U.S. Solar Energy Industries Association (SEIA) and GTM Research, which added that solar energy accounted for 51% of all new energy generation in the quarter.

Based on its latest Solar Deal Tracker, also released this week, IHS says more than 32 MW of utility-scale solar projects – over 5 MW in size – are currently under development or construction in the U.S. as companies hurry to complete them before the ITC deadline on December 31, 2016.

The U.K., which installed over 1.5 GW in Q1, is continuing to forge Europe’s onward path. It is set to keep the European solar crown for a second year running in 2015 – something no one would have believed just a couple of years ago.

Of the 40 GW installed in 2014, Europe accounted for just 7 GW, 2.4 of which were deployed in Britain, while Germany added just 1.9 GW and France 927 MW. Despite this, Europe still leads in terms of cumulative installed capacity, at 88 GW.

In the next five years in Europe, markets are expected to stagnate, before growing again, "powered by lowered prices and new business models."

Overall, however, China, which has recently raised its PV installation targets to 17.8 GW, is set to lead the solar charge. In the report released by SolarPower Europe, the association said China had installed 5 GW of PV in Q1. Achieving this year’s target, it continued, will be contingent on a number of factors, chiefly "unlocking" the distributed market.

The PV Market Alliance added that China could remain the top PV market until the end of the decade, unless India manages to play catch up.

India’s bright future

In Bridge to India’s India Solar Handbook, also released at Intersolar, it said the country’s growing solar capacity could see it enter the international top five. For this year, it estimates growth of 250%. It added that while 2014 saw only 3 GW installed, it could increase this to 100 GW by 2022.

Speaking to pv magazine at Intersolar, Gyanesh Chaudhary, the CEO of Vikram Solar further said that India’s module manufacturing capacity now standing at almost 3 GW and that the country’s solar manufacturers had "come of age."

Increasing solar importance

In its report, SolarPower Europe notes the "key" role solar has played in helping the renewable energy industry overtake nuclear power for the first time in Europe.

Solar is said to cover more than 1% of current world electricity demand. Specifically, says SolarPower Europe, it is meeting over 7% of demand in Germany, Italy and Greece. Across Europe, solar accounts for 3.5%, while a total of 13 countries are said to be meeting 1% of their energy needs with the renewable energy. For the last five years solar PV, along with wind and gas has been the most installed source of electricity in Europe.

Finally …

In the final bit of news to roundup what has been another incredibly busy week in the solar PV industry, two companies have announced details of their upcoming IPOs.

Principal Solar Inc is looking to raise up to US$26 million by selling up to 2.8 million shares, when it goes public this week. In addition to the sale of 2.5 million shares for between $9 and $11 a share, there is the option to purchase up to 375,000 additional shares of its common stock for $3.7 million.

It plans to become the "world’s first distributed solar utility" and has identified targets, including SolarCity and TerraForm Power, which it could either partner with, or acquire. The U.S. solar company will also develop up to 500 MW of PV projects in Texas.

Meanwhile, the yieldco vehicle of First Solar and SunPower is expected to raise around US$420 million in its upcoming IPO, which is set to value the company at up to $1.49 billion. It has also secured $525 million in credit facilities.

8point3 Energy Partners LP is set to sell 20 million Class A shares at between $19 and $21 each, in an initial public offering (IPO). They are expected to be listed on the NASDAQ Global Market under the symbol "CAFD."

There will also be the option to purchase an additional three million shares. If this option is exercised, reported Law360, it will bring in about $56.3 million in additional net proceeds.