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Taking Solar to the Next Level

A design "charrette" sponsored by the Rocky Mountain Institute brought industry experts together to discuss how to bring down the installed costs of PV. The group focused on reducing BOS costs.
by Rebecca Cole, Rocky Mountain Institute Published: September 9, 2010

Boulder, Colorado, United States -- Creativity is the key to transformation. But creativity doesn't occur in a vacuum. Instead, creativity works best when people can pool their collective intellect and collaborate on game-changing ideas.

"Now that the hard costs have come down, the soft costs are forcing us to standardize. We need to do it at every single part of the value chain—manufacturing, installers, contractors, code officials, regional jurisdictions, banks, and financing options."
-- Doug Paine, Executive Director, SolarTech

In June, Rocky Mountain Institute convened a design charrette focused on the solar photovoltaic (PV) industry.

Held in San Jose, California, the event offered industry stakeholders and outside experts an opportunity to come together in the spirit of “coopetition” to identify designs and other improvements that could help bring down the “installed” costs (i.e., all the costs except the modules themselves) for commercial- and utility-scale PV projects.

“Despite all the dynamics of the industry, we really have a situation where you have people working on piecemeal solutions so you don’t get the full power of integration,” said Stephen Doig, PhD, a program director at RMI. “You have competition that inhibits cooperation.” Bringing diverse players together, he said, unlocks a power that often isn’t available to for-profit businesses that are simply trying to get the job done.

For any industry to grow, rules have to be changed, explained Sandy Munro, a charrette attendee and CEO of Munro & Associates. “The rules are what hold you back,” he said. “But once people start thinking differently, the rules fall away.” Enormous Potential for Solar Energy

Solar PV will play an increasingly important role in meeting the world’s energy needs, with continued double-digit annual growth predicted.

One report, released last December by the Electric Power Research Institute, states that the solar PV market is a “billions-of-dollars-per-year business for both module production and system installation.” However, only a tiny fraction of U.S. electricity is supplied via solar today—well under 0.1 percent in 2009. Installed system costs must come down in order for solar to be a viable part of the U.S. energy portfolio.

“We have a pressing need to find alternatives to fossil fuels,” Doig said. “The sun is by far the most abundant renewable resource out there. We are quite good already at converting that sunlight to electrical energy. The real issue is how do we get the costs down to a level where the adoption of solar energy takes off exponentially without the need for price supports or other incentives.”

While module costs have decreased significantly in the past decade, falling 33 percent in 2009 to current prices below $2/watt, solar PV remains an expensive energy option. This is largely due to “Balance of System” (BoS) costs (racking, mounting, installation, labor, wiring, power electronics, permitting, and other process expenditures), which generally account for about half the installed cost.
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