Accelerating Solar Power Adoption: Compounding Cost Savings Across the Value Chain

This paper discusses common barriers to solar power adoption and techniques for getting around those barriers. The authors argue that for solar power to become a significant contributor to energy supply, and hence greenhouse gas emissions reductions, the industry has to achieve high annual growth rates for decades. The challenge cannot be overstated, especially once subsidies can no longer be relied upon to drive industry growth. Several barriers, including high costs, lack of reliable demand, supply chain dynamics, and utility integration issues, threaten to prevent adoption rates from rising as fast as is required. In particular, high costs are a major barrier, since solar power must soon be cost competitive unsubsidized. Fortunately, large cost-reduction potential is available, which has not been captured during the hectic expansion of the industry. Based on experience in other industries, the basic tools of end-use efficiency, whole-systems design, lean manufacturing, and economies of scale will let technology manufacturers and PV installers drive down costs by a factor of two or more. These savings, enabled with support from government policies, industrial collaboration, and process efficiency gains, can bring today’s PV technologies to grid parity in many markets, allowing the exponential growth curve to continue.