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Dawning of a New Era - Photovoltaics on the Edge of Grid Parity

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Dawning of a New Era - Photovoltaics on the Edge of Grid Parity

Grid Parity is believed to be the holy grail of the photovoltaic (PV) industry: the point in time when the cost of electricity produced through PV will equal the price for electricity from the grid. It is commonly postulated by renowned industry representatives that once grid parity is reached the PV industry will not require any support or incentives to thrive. But will this really be the case?

PV system prices have declined in the range of 35-40% since 2008, resulting from reductions in costs of solar panels, reduction in costs of balance of systems and higher efficiency in design, engineering and installation functions. To encourage the use of PV, government agencies across the world are introducing various incentive mechanisms. Rising electricity prices coupled with increasing environmental concerns amongst consumers have also contributed to an increase in PV installations. All these factors put together are providing an impetus to the PV industry to achieve grid parity. It is anticipated that grid parity will be reached in certain countries and market segments in the near future. But a fundamental question remains to be answered ‘How will Grid Parity change PV industry dynamics? Despite advancements, numerous problems continue to plague the industry. It has been observed that the production patterns of electricity through PV differ significantly from the consumption patterns in typical households casting doubts on PV becoming a major source of electricity for households. Also, in the medium term an increasing proportion of renewable energy is expected to exercise considerable strain on the existing electricity infrastructure.

Therefore, it is essential to gain a deeper understanding of the topic. The study investigates the phenomenon of ‘Grid Parity’ and other major milestones towards PV competitiveness viz. ‘Incentive Parity’ and ‘Generation Parity’ and seeks answers to possible implications considering PV from a holistic electricity mix perspective. Additionally, it provides insights on the development of PV installations beyond attaining Grid Parity in certain markets/segments and highlights various products and drivers which could potentially drive the market in the future.

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Diesen Artikel haben wir am Montag, 15. August 2011 in unseren Katalog aufgenommen.

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