Solar energy could be the world’s largest source of electricity by 2050, ahead of fossil fuels, wind, hydro and nuclear, according to two reports issued by the International Energy Agency (IEA). The two IEA technology roadmaps show how solar photovoltaic (PV) systems could generate up to 16% of the world’s electricity by 2050 while solar thermal energy (STE) from concentrated solar power (CSP) plants could provide an additional 11%. Combined, these solar technologies could prevent the emission of more than 6 billion tonnes of carbon dioxide per year – that is more than all current energy-related CO2 emissions from the United States or almost all of the direct emissions from the transport sector worldwide today.
“The rapid cost decrease of photovoltaic modules and systems in the last few years has opened new perspectives for using solar energy as a major source of electricity in the coming years and decades,” said IEA Executive Director Maria van der Hoeven. “However, both technologies are very capital intensive: almost all expenditure is made up front. Lowering the cost of capital is therefore of primary importance for achieving the ‘vision’ of these roadmaps.”
The Executive Director also stressed that the two reports do not represent a forecast. As with other IEA technology roadmaps, they detail the expected technology improvement targets and the policy actions required to achieve that objective by 2050, highlighting priority actions and milestones for governments, researchers and industry investors.
A central message from both publications deals with the need for clear, credible and consistent signals from policymakers, which can lower deployment risks to investors and inspire confidence. “By contrast,” Ms. Van der Hoeven said, “where there is a record of legislative incoherence, confusing signals or stop-and-go policy cycles, investors end up paying more for their investment, consumers pay more for their energy, and some essential projects simply will not go ahead.”
Both documents underline the complementary role of the two technologies. With 137 GW of capacity installed worldwide at the end of 2013 and growing by 100 MW each day, PV expansion so far has been much faster than STE, mainly thanks to massive cost reductions. Under the scenario described in the roadmaps, most of the growth of solar electricity comes from PV until 2030. However, the picture changes afterwards. By achieving shares of between 5% and 15% of annual electricity generation, PV starts to lose value in wholesale markets. Massive-scale STE deployment takes off at this stage thanks to CSP plants with built-in thermal storage. This allows for electricity to be generated when demand peaks in late afternoon and in the evening, thus complementing PV generation.
PV is expanding globally, with China being by far the leading country, followed by the USA. Over half of total capacity however rests with the end user, whether households, shopping centres or industries. STE is undergoing expansion in very sunny areas with clear skies and is becoming a clear opportunity for Africa, India, the Middle East and the United States.
Both roadmaps provide a vision for deployment based on updated modelling results consistent with the IEA’s Energy Technology Perspectives 2014 and its climate-friendly scenario for renewables. Each publication in turn offers a set of key actions for policymakers for the next five years. For both, solar PV and STE, these key actions include: setting or updating long-term targets for deployment; developing procedures for providing permits and connection; and implementing remuneration schemes that reflect the true value of power systems.