Exeter Study Claims Solar ‘Tipping Point’, Challenges To Solar Growth

The study, led by the University of Exeter and University College London, is part of the Economics of Energy Innovation and System Transition (EEIST) project, funded by the UK Government’s Department for Energy Security and Net Zero and the Children’s Investment Fund Foundation (CIFF).

Based on a data-driven model of technology and economics, the study finds that solar PV (photovoltaics) is likely to become the dominant power source before 2050 — even without support from more ambitious climate policies. That finding is driven by the sharp drop in the cost of solar equipment no doubt, besides the indirect costs increasingly associated with other options, be it fossil fuels or nuclear.

However, the research study singles out four “barriers” that could hamper this: creation of stable power grids, financing solar in developing economies, capacity of supply chains, and political resistance from regions that lose jobs.

The researchers say policies resolving these barriers may be more effective than price instruments such as carbon taxes in accelerating the clean energy transition.

“The recent progress of renewables means that fossil fuel-dominated projections are no longer realistic,” Dr Femke Nijsse, from Exeter’s Global Systems Institute. “However, older projections often rely on models that see innovation as something happening outside of the economy. “In reality, there is a virtuous cycle between technologies being deployed and companies learning to do so more cheaply”, while adding, “When you include this cycle in projections, you can represent the rapid growth of solar in the past decade and into the future.”

“Traditional models also tend to assume the ‘end of learning’ at some point in the near future — when in fact we are still seeing very rapid innovation in solar technology. “Using three models that track positive feedbacks, we project that solar PV will dominate the global energy mix by the middle of this century.”

However, the researchers warn that solar-dominated electricity systems could become “locked into configurations that are neither resilient nor sustainable, with a reliance on fossil fuel for dispatchable power.”

Instead of trying to bring about the solar transition in itself, governments should focus policies on overcoming the four key “barriers”:

• Grid resilience: This is linked to solar generation’s variability (day/night, season, weather). Dr Nijsse said, “If you don’t put the processes in place to deal with that variability, you could end up having to compensate by burning fossil fuels.” She said methods of building resilience include investing in other renewables such as wind, transmission cables linking different regions, extensive electricity storage and policy to manage demand (such as incentives to charge electric cars at non-peak times). Government subsidies and funding for R&D are important in the early stages of creating a resilient grid, she added.
• Access to finance: Solar growth will inevitably depend on the availability of finance. At present, low-carbon finance is highly concentrated in high-income countries. Even international funding largely favours middle-income countries, leaving lower-income countries — particularly those in Africa — deficient in solar finance despite the enormous investment potential.
• Supply chains: A solar-dominated future is likely to be metal- and mineral-intensive. Future demand for “critical minerals” will increase. Electrification and batteries require large-scale raw materials such as lithium and copper. As countries accelerate their decarbonisation efforts, renewable technologies are projected to make up 40% of total mineral demand for copper and rare earth elements, between 60 and 70% for nickel and cobalt, and almost 90% for lithium by 2040.
• Political opposition: Resistance from declining industries may impact the transition. The pace of the transition depends not only on economic decisions by entrepreneurs, but also on how desirable policy makers consider it. A rapid solar transition may put at risk the livelihood of up to 13 million people worldwide working in fossil fuel industries and dependent industries. Regional economic and industrial development policies can resolve inequity and can mitigate risks posed by resistance from declining industries.

The study largely covers areas that have been covered well by solar proponents, while highlighting the fact that oft-cited challenges continue to remain stubbornly resilient. Solar cynics in large countries like the US, which is the second largest by solar capacity added in 2022-23 for instance, have also been seeking a science based check on the ability of grids to run purely on say, solar and wind. Their contention is that such a scenario has not been tested at all, especially the costs linked to it in the form of backup energy costs. While deliberately ignoring the viability of using nuclear or less polluting gas based power in such scnarios, the fact remains that at current rates and with the technology we have, solar’s overall share of generation (unlike capacity) will struggle to cross 20% globally without a significant breakthrough in storage costs as well as higher solar efficiency and materials access and recycling.

The full study can be accessed at Nature communications here.