EME 810
Solar Resource Assessment and Economics

10.2 Exponential Growth of Solar and Impact

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Reading Assignment

  • Geoffrey Carr (Nov 21, 2012) "Sunny Uplands" The Economist. (Yes, it still holds true years later...)
  • Doubling Time (Wikipedia article, accessed on Nov. 14, 2013)

Please read about the rate of growth of PV (it's been quite high for decades), tied to the "learning curve" of PV costs from a doubling in cumulative production capacity. There is a positive feedback loop occurring here, and it suggests that PV (and other solar) will become very, very big globally within the next decade.

Growth in Solar

From our reading, we have seen the:

  • Growth Rate: 32-37% increase in PV installed globally:
    • PV industry as installed capacity (in Wp) doubles about every 2 years (or less in recent years).
    • Compare this to the (still large) rate of growth of wind capacity from 2006-2016: 17-18%.
  • Swanson Effect: 17-24% drop in manufacturing costs (called a learning curve or an experience curve) with each doubling of cumulative production (learning curve):
    • Installed capacity is different from the time for cumulative production to double (2-3 years), but it is similar.
    • \$76.67/watt in 1977 to \$0.74/watt for 2013.
  • Growth rate combined with the learning curve is a positive feedback loop in systems thinking. Meaning: "more solar" will lead to "a lot more solar!";
  • With every doubling, the awareness of other solar technologies increases. e.g.:
  • Even the building industry shares a solar history through passive solar architecture.

Self-check questions:

1. Using the "rule of 70," what is the estimated doubling time for something growing at a geometric rate of 35%?

Click for answer.

ANSWER: Two years.

2. What is a "learning curve"?

Click for answer.

ANSWER: A representation of an increase in learning (and thus reduced production costs) with an increase in experience by a firm. The more experience that a firm develops while making/producing a type of product, the lower the cost of producing it. Here, we are using the concept of the learning curve to describe the entire PV industry.