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Cheaper solar panels on the horizon

Dec 11 2011 12:33 Francois Williams

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Durban – The price of photovoltaic solar power is rapidly coming down. Solar power is already half as cheap as electricity from diesel-powered generators and could soon compete with the price of electricity from Eskom’s new coal-fired power stations, Medupi and Kusile, says Thierry Lepercq, who chairs French solar power group Solairedirect.

The cost of solar power systems has fallen 60% over the past 12 months and 80% over the past three years.

Thanks to strong demand for solar panels over the past five years a bottleneck has arisen in delivery of silicon, the main component of photovoltaic solar panels. Silicon is basically made from sand, which comprises 28% of the earth's crust. Lepercq says in 2002 the price of polysilicon – which is used in manufacturing solar panels – was $20/kg. Early in 2008 it rose to $500/kg. A year ago the price was $100, and it has now come back to $20.

The efficiency of solar panels is continuously improving and the price of new machinery for manufacturing them is now third of what it was a year ago.

Lepercq says solar power is in transition from an emerging industry to something much larger. It's a merger of microelectronics and the energy industry. There are three ways in which green power projects can be tackled.

One way is in small projects with a great deal of marketing material, but ultimately this is only green window-dressing.

Others begin on a grand scale but, as soon as the developers see how expense it is, everything collapses.

Lepercq reckons a sustainable method is to tackle green power projects as public-private partnerships. His group recently entered into a solar power partnership in western France with Sorégies – the fourth largest electricity company in France – and the regional government of Poitou-Charentes. The government owns a 65% stake and Solairedirect 35%. Sorégies has signed a 30-year agreement with Solairedirect to buy and distribute electricity generated by 60MW solar powered plants. Solairedirect will build the plants between 2012 and 2015.

Lepercq believes this model could be used in South Africa. It offers opportunities for other investors to invest in the project as well, and will create sufficient scale to justify the building of a local factory to produce solar panels.

Solairedirect submitted two local 10MW solar power projects in South Africa's first round of purchasing for green power, but was unsuccessful. Lepercq says he suspects the price was too high. Price forms 70% of the adjudication in the bidding process and local content only 5% – as far as photovoltaic solar power is concerned.

Solairedirect has a factory in Cape Town. Lepercq is convinced that the company can within the next few months produce electricity from solar power at less than R1 per kWh.  

 - Sake24

for more business news in Afrikaans, go to Sake24.com

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