“Solar energy is free, but it’s not cheap”
best sums up the major hurdle for the solar industry. There are no
technical obstacles per se to developing solar energy systems, even at
the utility megaWatt level (e.g., 14 MW utility scale PV system at Nellis AFB or a 64-MW CSP system in Nevada); however, at such large scales a high initial capital investment is required.
Over the past three decades, a significant reduction of the cost
of solar products has occurred, without including environmental
benefits; yet, solar power is still considered a relatively expensive
technology. For small- and medium-scale uses, in some applications, such
as passive solar design for homes, the initial cost of a home designed
to use solar power is essentially no more than that of a regular home,
and operating costs are much less.
The only difference is that the
solar-energy home works with the Sun throughout the year and needs
smaller mechanical systems for cooling and heating, while poorly designed homes fight the Sun and are iceboxes in the winter and ovens in the summer.
Industrial
society and modern agriculture were founded on fossil fuels (coal, oil,
and gas). The world will make a gradual shift throughout the
twenty-first century from burning fuels to tech-nologies that harness
clean energy sources such as sun and wind.As energy demand
increases as developing countries modernize and fossil fuel supply
constricts, increased fuel prices will force alternatives to be
introduced. The cost of technologically driven approaches for clean
energy will continue to fall and become more competitive.
Eventually, clean energy technologies will be the inexpensive solution.
Eventually, clean energy technologies will be the inexpensive solution.
As the full effect and impact of environmental
externalities such as global warming become apparent, society will
demand cleaner energy technologies and policies that favor development
of a clean-energy industrial base. By the end of the twenty-first
century, clean-energy sources will dominate the landscape.
This will not be an easy or cheap transition for society, but it is necessary and inevitable.
Rural Systems
Rural Pakistani village |
Already,
solar energy is cost effective for many urban and rural applications.
Solar hot-water systems are very competitive, with typical paybacks from
5–7 years as compared to electric hot-water heaters (depending on the
local solar resource).
PV systems are already cost competitive for
sites that are remote from the electric grid, although they are also
popular for on-grid applications as environmental “elitists” try to
demonstrate that they are “green.
”However, one should beware of
“green-washing” as people and companies install grid-tied PV systems
without making efforts to install energy-efficient equipment first. Far
more can be achieved through energy conservation than solar energy usage
alone for reducing carbon emissions.
The
decision to use a solar energy system over conventional technologies
depends on the economic, energy security, and environmental benefits
expected. Solar energy systems have a relatively high initial cost;
however, they do not require fuel and often require little maintenance.
Due to these characteristics, the long-term life cycle costs of a solar
energy system should be understood to determine whether such a system is
economically viable.
Historically, traditional business entities
have always couched their concerns in terms of economics. They often
claim that a clean environment is uneconomical or that renewable energy
is too expensive. They want to continue their operations as in the past
because, sometimes, they fear that if they have to install new
equipment, they cannot compete in the global market and will have to
reduce employment, jobs will go overseas, rates must increase, etc.
The
different types of economics to consider are pecuniary, social, and
physical. Pecuniary is what everybody thinks of as economics: dollars.
Social economics are those borne by everybody and many businesses want
the general public to pay for their environmental costs. If
environmental problems affect human health today or in the future, who
pays? Physical economics is the energy cost and the efficiency of the
process. There are fundamental limitations in nature due to physical
laws. In the end, the environment and future generations always suffer
the corollary of paying now or probably paying more in the future.
An
economical analysis should be looking at life cycle costs, rather than
at just the ordinary way of doing business and low initial costs. Life cycle costs
refer to all costs over the lifetime of the system. Also, incentives
and penalties for the energy entities should be accounted for.
What
each entity wants is to earn subsidies for itself and penalties for its
competitors. Penalties come in the form of taxes and fines; incentives
may come in the form of tax breaks, unaccounted social and environmental
costs, and also what the government (society) could pay for research
and development.
Reference: Solar energy – Renewable energy and the environment – R.Foster
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