Heads Up: Grid parity in 5-8 years, but industry shake-out could start next year

[bananas]

Solar PV will reach grid parity in 5-8 years, but an industry shakeout will occur over the next couple of years, and some good companies will go under. I have no doubt that doomers and pro-nukes and pro-coals will use this chaos to justify their wrong opinions and flawed analysis.




http://209.85.173.104/search?q=cache:ZK1_dq86IjsJ:sst.pennnet.com/display_article/307597/5/ARTCL/none/UPFRN/1/Wall-Street-analyst:-Take-long-view-on-solar-PV/+solar+pv+parity

Wall Street analyst: Take long view on solar PV

by Phil LoPiccolo, Editor-in-Chief, Solid-State Technology

The cost to produce electricity with solar photovoltaics (PV) technology could reach grid parity with traditional utility electricity generation in five to eight years, after which the industry would take off on its own merits without the need for incentives -- and that's a conservative estimate, according to Stephen O'Rourke, Managing Director, Deutsche Bank Securities, speaking at a SEMI New England "Wafers to Wall Street" Breakfast Forum (Sept. 19 near Boston).

<snip>

The key factor, O'Rourke noted, is that the US solar PV electricity-generation cost curve for known solar PV cell technologies is expected to drop, from what is roughly 25¢-30¢/kWh today to about 10¢/kWh by 2020, transitioning through what is commonly considered grid price parity (~15¢/kWh) within five to eight years. Conversely, the average retail price of conventionally generated US electricity will rise, from 8.6¢/kWh in 2006 to potentially more than 20¢/kWh by 2020, depending on cost CAGR projections ranging from 4%-7% (see figure, above). At these rates, cost "convergence" will begin within the next five to eight years, he predicted.

<snip>

The outlook from Wall Street

All the companies playing in the solar PV industry -- from semiconductor to PV manufacturers and from materials to equipment suppliers -- are positioning themselves for the explosive growth phase, which starts in five to seven years, O'Rourke said. Thus, we're marching toward a temporary oversupply first and then rapid growth afterwards.

The PV industry's initial growth phase (2003-2008) has seen huge growth in financing activity, with many companies vying to go public with competing technologies, and stock performance in aggregate has been strong (see figure, below). But from 2009-2012 there could well be a period of shakeout and consolidation when all stocks will tumble, even the best-positioned ones, O'Rourke predicted. "Some companies will not exist when we come out the other side, and while we can identify some long-term winners today, some that will lead this industry down the road, are probably unknown today."

In the early throes of this shakeout (2008-2009) the corporate financing boom could drop sharply, but from 2009-2012 finance activity will rebound, partly from merger and acquisition activity, O'Rourke said. After that, grid parity will be achieved, and the industry will take off on its own economic merits, without the need for incentives. "When that happens, we will see an enormous build-out of capacity, even greater corporate financing activity, and, with the departure of many weaker companies, stock profiles will improve. Eventually, perhaps beyond 2021, he estimated, we will witness the cyclical growth of a more mature industry.

<snip>

[NMDemDist2]

1. i watching the nanosheets closely and am heavily researching wind

I had a neighbor over yesterday who was asking me about it and I told her "We need a Democrat in the White House to push through some serious tax incentives for solar and wind"

I was shocked when she agreed with me (here in my little RED town I'm always shocked when I meet someone who doesn't scream NO when they hear the word Democrat)

[NNadir]

2. In 5 to 8 years, we'll be hearing about "grid parity in 5 to 8 years"

The renewable fantasy's proponents, going back to the days of the paid (off) anti-nuke Walmart executive's 1976 blather, is notoriously over optimistic.

In fact, if you track any of the balderdash written by anti-nukes in these pages, say the crapola that was being said here in 2002 about 2007, you are made completely aware that the "renewables will save us" industry lives in constant dread of having to actually produce energy as opposed to talk about energy.

And let's read what the paid (off) Rio Tinto/Walmart/Royal Dutch Shell executive Amory Lovins had to say in 1976:

Ingenious ways of backfitting existing urban and rural buildings (even large commercial ones) or their neighborhoods with efficient and exceedingly reliable solar collectors are being rapidly developed in both the private and public sectors. In some recent projects, the lead time from ordering to operation has been only a few months. Good solar hardware, often modular, is going into pilot or full-scale production over the next few years, and will increasingly be integrated into buildings as a multipurpose structural element, thereby sharing costs. Such firms as Philips, Honeywell, Revere, Pittsburgh Plate Glass, and Owens-Illinois, plus many dozens of smaller firms, are applying their talents, with rapid and accelerating effect, to reducing unit costs and improving performance. Some novel types of very simple collectors with far lower costs also show promise in current experiments.

Lovins, Amory. "The Road Not Taken" Foreign Affairs pp 80-81, October 1976.

Why is this 2007 article any less stupid than Lovins was in 1976?

The solar industry does not now, has never and will not in 2015 be producing one exajoule of energy.

While this line of crap generated huge revenues for Lovins based on his 1976 science fiction article, netting him a McMansion in Snowmass, 500 billion tons of dangerous fossil fuel waste has been dumped into the atmosphere. He, apparently, couldn't care less.

Thanks to the similar bullshit from the anti-nuke fossil fuel apologist Gerhard Schroeder, tens of thousands of people will die in Europe and Africa while the "solar and wind" Germans import coal from South Africa.

There is absolutely no reason to believe any of the happy horseshit from coal and gas apologists like Lovins and his pal Schroeder, the Gazprom executive.

The MBA type horseshit we have here is just that, horseshit, and we're not talking about the horseshit that is supposed to supply the entire Northeast with natural gas from make believe methane digesters.

[phantom power]

3. I now wish I had saved a jpeg of every grid parity prediction curve...

that I've seen over the last 30 years. I could make a photo-essay out of it. Or a collage.

[Nihil]

4. Print them off ...

... and you can take your whole house off-grid by feeding them into
your combined heat & power generator!
:silly:

[Dead_Parrot]

5. Be a bit boring, wouldn't it?

Dozens of graphs showing the same thing, with the dates moved every year or so.

Personally, I wish I had 2 cents for every industry-sponsored breakfast seminar where some guy talked about how much money we could all make, but maybe I just don't like the risks.

Interestingly, Deutsche Bank's Energy Investment Banking practice is headed by a petroleum geologist (James C.V. Rogers). Go Figure.

[phantom power]

6. Well, I was thinking of taking an artistic cue from Warhol...

If he can get that in the MOMA, why not me?

[jpak]

7. I wish I had a jpeg of every US nuclear reactor ordered since 1973

It would be a nice empty frame...

:evilgrin:

[NickB79]

8. You could superimpose the skyrocketing CO2 emissions over it

And a picture of Buddy Jesus giving a big thumbs-up.

[Kolesar]

9. Coal &nuke prices will keep rising due to construction costs &coal due to smog regulations

And that will help renewables to reach parity.

Not to mention that photovoltaic electricity will crush coal & nuclear due to the 5 to 8 cent/kW*hour disadvantage of supporting the moribund distribution system.

__o_____

For that matter, coal is going to have a HUGE disadvantage when coal generators have to fund billion dollar projects to put CO2 sequestration apparatus on their power plants.

[Heywood J]

10. "disadvantage of supporting the moribund distribution system."

Which apparently solar power does not need, even at night or on cloudy days now...

[Kolesar]

11. I could imagine buying only half the electricity that I currently buy

...from the generating company. I suppose that "supporting the moribund distribution system" might be assessed on me by a monthly minimum service charge.

However, that does not take anything away from the economics of generating my own electricity.