A Price Drop for Solar Panels (MIT Tech. Rev.)

[jpak]

http://www.technologyreview.com/Biztech/20702/

Solar electricity is about to get much cheaper, industry analysts predict, because a shortage of the silicon used in solar panels is almost over. That could lead to a sharp drop in prices over the next couple of years, making solar electricity comparable to power from the grid.

High demand generated by government subsidies worldwide and a shortage of processed silicon have kept prices for solar-generated power much higher than average electricity prices over the past few years. Solar power is more than three times the cost of electricity from conventional sources, according to figures from the industry tracking firm Solarbuzz and the United States' Energy Information Administration. Solar power cost about $4 a watt in the early 2000s, but silicon shortages, which began in 2005, have pushed up prices to more than $4.80 per watt, according to Solarbuzz.

Crystalline silicon has long been the staple of the semiconductor industry. But it's also the active material in the most common type of solar panel, and the increased use of solar power has led to the shortage of the material. Indeed, the growth in silicon production hasn't kept pace with the rise in solar power. "It takes about two or three years to add capacity," says Travis Bradford, an industry analyst for the Prometheus Institute. The shortage has been severe enough to drive up silicon prices to more than 10 times normal levels, to $450 a kilogram, adds Ted Sullivan, an analyst at Lux Research.

The added silicon production capacity is now starting to begin operations. While only 15,000 tons of silicon were available for use in solar cells in 2005, by 2010, this number could grow to 123,000 tons, Sullivan says. And that will allow existing and planned production of solar panels to ramp up, increasing supply. "What that means, practically, is that module prices are going to come down pretty dramatically in the next two or three years," Bradford says.

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[End Of The Road]

1. Stoopid questions about silicon production

I know its many uses, but I don't quite grasp how it's produced. It's a crystal that has to be grown, right? How long does it take? Is production so expensive and difficult that it's limited to megagiants like Dow Corning, or are there many smaller producers? Are there gov't subsidies to encourage production? Should there be?

[Dead_Parrot]

2. Most PV silicon is cast-offs for computing

If you need to make a quad-core pentium, you need 99.9999% pure silicon: If you get a duff batch that's only 99.99% pure, you chuck it out to the PV companies, who turn it into solar panels (which is why life cycle analyses for PV get away with claiming 99.99% pure silicon as a freebie).

That does, of course, produce a bottleneck in manufacture - the 'free' silicon supply is dictated by the computer processing industry's demand, and the silicon processing industry's quality. There are now a number of outfits that just make PV silicon, and since they're not trying to please Intel they can do it on the cheap (google "buckets of bubbling white liquid").

It will remain a large scale process, though - You can't do it in the kitchen as you need insane amounts of heat and chemicals to do it properly. But the same is true for any metal smelting, so unless you're going to carve your own windmill you're pretty stuck with it.

And yes, there are subsidies (mainly as tax rebates). Anything up to 50%, AFAIK.

[End Of The Road]

3. Thanks. This is useful info! nt

[kristopher]

4. We will be seeing more and more of this type news in all areas of renewables. nt