For decades now, wind turbines have been generating electricity more cheaply than most other (non-hydro) renewable energy technologies. In particular, wind has maintained a comfortable lead over solar energy in the price-per-kWh race.
For instance, a leaked “confidential” report1 prepared for the City of Los Angeles last year estimated that rooftop PV systems being contemplated by the Department of Water & Power would cost about $7,000 per kilowatt to install, with a 20 percent capacity factor. The report said these capital-cost figures were triple those for equivalent wind capacity (which on average generates with about a 30 percent capacity factor), and 1.5 times the price of solar thermal power.
Given wind’s clear economic advantage, the industry has focused most of its renewable-related attention on wind power. Transmission development efforts and policy processes have concentrated on bringing remote wind resources into load centers, and system operators have worked to accommodate wind’s variable and non-dispatchable nature (see “Beyond Intermittency”). In short, with few exceptions, wind stands at the top of the renewable pecking order.
That’s destined to change.
Although wind still maintains a lead in the cost race, solar has begun making its move, and likely will catch up with wind and pass it in the foreseeable future. The reason is a fundamental difference in the two types of technology, and their different opportunities for improvement.
Wind R&D mostly focuses on large-scale problems in materials, design and management—including wind forecasting. By contrast, solar research—especially PV—focuses mostly on very small-scale materials and designs. And on that very small scale—the nano scale—technology is advancing at a pace that even today’s cloud-scraping wind turbines can’t possibly match.
Investors and technology developers increasingly view wind energy as a mature technology, whose costs have reached a practical floor. Of course, that’s not to say wind won’t become more economical in the future. R&D continues advancing the efficiency and performance of equipment and facilities. Forecasting in particular is raising the overall value of wind energy on regional power networks.
Such progress is driving down wind’s effective price-per-kWh, but wind’s cost-per-kWh probably won’t improve at anything resembling an exponential or even steady linear pace. Costs will fall at an incremental pace, with that progress slowing down over time. This is no secret, but it will become a serious competitive disadvantage for wind power as PV technology advances.
According to Ray Kurzweil, futurist and author of The Singularity is Near, the historic rate of advancement in PV technology matches that of information technologies—i.e., it proceeds at an exponential rate, in keeping with the now-famous Moore’s Law. But where Moore’s Law predicts a doubling in IT processing power every 18 months, Kurzweil says the data show PV’s cost-per-kWh drops 50 percent roughly every two years (see Figure 1). This logarithmic advancement rate is connected to PV’s dependence on nanotechnology R&D.
“Nanotechnology is inherently an information technology,” Kurzweil told an audience of senior executives at the Accenture International Utility & Energy Conference in mid-April. “Emerging nanotechnology will accelerate progress in the cost of solar panels.”
Already nanotech R&D is turning out some mind-boggling PV products. A company called Nanosolar now is selling thin-film solar panels—which the DOE’s National Renewable Energy Laboratory certified as being more than 15 percent efficient—produced by nano-printers at a rate of 100 feet per minute. The company claims that when it reaches full production it will be producing PV panels for 60 cents a watt; that’s wholesale cost, not installed retail cost, which is more like $2.50 a watt. Nevertheless, it compares favorably to roughly 80 cents for a watt of wind power capacity.
At PV’s exponential pace of progress, Kurzweil says the tipping point, at which the cost-per-watt of output from PV becomes lower than the cost from oil and coal, will occur in about five years—sometime around 2015. And assuming nanotech and solar R&D continues following Moore’s Law, global solar energy production will continue doubling every two years. “We are less than 10 doublings from [PV being capable of meeting] 100 percent of the world’s energy needs,” Kurzweil said.
Such hyperbolic predictions might be hard to swallow, and in fact Kurzweil wasn’t saying PV will replace every other energy source. Indeed, he was careful to point out that no technologies advance in a vacuum, and other energy technologies will enjoy their share of improvements. In particular, he said electricity storage and fuel cell technologies are advancing at a logarithmic rate, in keeping with their IT-driven nanotech R&D.
For wind, however, those improvements seem likely to advance at a more incremental pace, which raises a key question. Will solar eventually render today’s big wind farms obsolete?
Once capital costs are fully absorbed, the answer comes down to operating cost. For both wind and solar, the fuel literally falls out of the sky, so electricity costs for wind and solar plants depend entirely on operations and maintenance. According to figures prepared by Navigant Consulting (see “Green Job Realities”), wind farms rank among the cheapest to operate of all energy sources, including fossil, nuclear and hydro. By contrast, solar PV facilities are among the most expensive to operate, given the need to continually clean utility-scale solar panels.
For some time, this difference likely will keep existing wind farms comfortably competitive with solar among the renewable options available to the industry. But that could change too, given the relentlessly doubling nature of nanotech-driven PV. Spray-on materials, such as those described in a New Energy Technologies patent application, might need cleaning no more frequently than the windows to which they’re applied. And technologies like nanowires and quantum dots could embed PV cells into a range of products, including fabrics, paints and shingles. Such cells would have a low energy conversion rate, but so what?
If the cells are cheap enough, and the O&M costs are low (or even zero), PV becomes a game changer—challenging not only the industry’s traditional energy sources, but also the reigning green champion, utility-scale wind.
1. Industrial Economic and Administrative Survey of the Los Angeles Department of Water & Power, PA Knowledge Ltd., Jan. 17, 2009, accessed April 28, 2010.