Solar as Future of Energy

The Economist ran a couple of stories about Solar Energy in the latest issue (16 April 2016); mainly touting the trends the industry has been facing in the recent years:

  1. Falling cost of panels
  2. Increasing interest, attention and commitment (in the form of Feed-in Tariffs)
  3. Falling levels of subsidy support and FiTs
  4. Increased avenues of financing and ambitious solar farm projects

Quite a couple of bottlenecks to the growth of solar still awaits solutions; and in the recent years, competition in this industry will be shifting into solving some of these problems holding back the development of solar energy.

  1. Land intensity of PV solar farms (need to improve efficiency and quality of PV cells) – land is an issue because of potential competition with arable land (plants need sunshine too) in certain places
  2. Intermittency of Solar power (a large dark cloud moving over a PV farm by can reduce generation significantly and abruptly – need for energy storage and some sort of balancing mechanism)
  3. Grid curtailment issues; inability of the grid to take in the power generated when at the peak generation capacity (especially with wind power thrown into the vicinity).

As a result, I believe these issues are going to drive the growth of this few industries/businesses:

  1. Data analytics combining weather/cloud forecasting with energy storage smart systems to optimise the operations of large scale solar farms
  2. Market platforms that helps with cost-balancing and electricity trading in order to smoothen demand and supply fluctuations from solar/wind power
  3. Improvements in both energy storage technologies as well as PV cell technologies.
  4. Further financial innovation in financing solar power deployments – including leasing of panels, leasing of rooftop space, usage-fee-purchase model, etc.