Amid the dramatic cost reductions and soaring demand for solar PV (photovoltaic) technologies in Australia and across the world, the long established idea of using the sun to heat water has taken a back seat. In Australia, where solar hot water (SHW) once dominated the local rooftop industry, installations were outpointed by rooftop PV by a factor of 5 in the last year.
But now SHW it is tipped to make a return to centre stage, along with relatively new solar thermal technologies that use the sun to provide heating and cooling for office and building spaces, district heating and under-floor heating in cooler climates, as well as for industrial processes and in hybrid systems with solar PV (known at PV-T). At a larger scale, it could one day be used for water treatment and desalination.
According to the International Energy Agency, solar heating and cooling (SHC) could make a dramatic impact on the world’s electricity grids, providing 17 per cent of all energy required for heating in buildings, industrial processes, swimming pools, and 17 per cent of cooling needs. This amounts to 3,500GW of capacity for heating, 1,000GW of capacity for cooling, and a further 200GW of capacity for swimming pools (up from 20GW now).
The advantages are obvious. It reduces the need for new generation and cuts the burden on grids, particularly in peak demand. And it is cost effective. Solar hot water is already one quarter of the price of gas and electricity equivalents. The IEA estimates that on a global average, SHW installations cost around $US27/year over the life of the equipment, compared to around $US87 for gas-fired heaters and $US95 for electricity.
These technologies are being ramped up to district-scale installations. A recent boom in solar-challenged Denmark as brought the costs of large scale solar heating down to around $35-$40/MWh, vastly cheaper than sourcing electricity from the grid to do the job.
Solar cooling technologies are relatively new, and not widely deployed – only 711 systems were deployed in the world in 2011, according to the IEA (although Australia’s CSIRO and the Australian Solar Institute are two of many organisations leading research in the area and developing demonstration systems). The IEA suggests that solar cooling particularly useful in handling electricity peaks, because it produces at the time of highest demand. It says the technology is already competitive in tropical regions with high electricity costs, including a 1.47MW capacity installation installed at a college in Singapore, was reportedly fully cost competitive without subsidies.
As this graph below indicates, China is by far the biggest user of solar hot water systems in the world (its line is actually cut because it doesn’t fit). It has installed SHW on more than 100 million homes, amounting to 117.6 GWth in 2010 (the equivalent of two Australian grids). It accounts for 60 per cent of the global capacity. The Chinese government’s latest five-year plan requires this number to grow to 280GWth by 2015 and to double again to 560GWth by 2020.
China is also likely the biggest market for industrial scale solar heating – because many of its industries require low heat up to around 120C – as opposed to cement, aluminium and other industries which require much more heat). The IEA estimates that China could account for one third of all solar heating production by 2050.
Another bumper solar month for Australia
The latest industry data produced by Sunwiz Consulting includes some interesting observations. First, that 115MW of PV was registered across Australia in June, virtually the same as last year. Sunwiz’ Warwick Johnston, noted that 100,000 applications were received in Queensland as the government gave notice of the winding back of its feed-in tariff, giving enough work for solar installers for another 40 weeks. Still, competition was fierce in the market, and according to Johnston, solar retailers are now absorbing some of the extra cost of large systems (above 1.5kW) caused by the winding back of the solar multiplier.
Germany and Italy finally head south
If the primary aim of the German government’s solar policy in 2012 was to reign in demand, then they have failed. But they might get it right next year. According to Deutsche Bank, German’s installation rate of solar PV in 2012 is likely to grow from the record 7GW in 2011 – with the first half running at an annualised rate of between 10GW and 12GW. But, as the proposed tariff cuts finally take effect, this run rate is expected to cause a sharp slowdown, and by next year the utility-scale sector – 1MW and above – is expected to all but disappear. Germany’s total demand is expected to be 3.5GW for 2013, although that is what was expected in 2012.
Italy appears to be having greater success in controlling its deployment of PV, deploying a subsidy cap that is likely to cause installations to fall from last year’s 9GW to 3.5GW in 2012 and 2.5GW in 2013. However, Italy, with more sun, is now offering opportunities for “grid-parity” deployment, which is expected to gather steam in areas such as Sicily. Offsetting this, are expectations that China’s market will top 7GW in 2012 and Japan’s will also grow quickly, turbo-charged by what are now the world’s most generous feed-in tariffs – designed to cut the balance of system costs by half.