Ramez Naam, an author and energy technologist, writes about falling costs of solar, wind, batteries, and electric vehicles.
Commenters cite his posts as perspective on solar's rapid price decline and exponential trend, noting forecasts underestimated it, and on cheap wind potential.
All great questions.
When I look at the "Worldwide growth of photovoltaics" plot at the top of the page you linked, I see the "Green" (European) color dominate from 2008-2013 (maybe 80%+ of installs). Germany purchases, peaking in 2011, where in the heart of when solar price declines occurred. By the same chart, deployments in the rest of the world explode post 2014, after the big price declines.
Here's an article from 2011 (concurrent with German deployments) showing the immense price falls at that time: https://rameznaam.com/2011/03/17/expis-moores-law-really-a-fair-comparison-for-solar/
Yes, there's a huge 'chicken' v 'egg' question here: deployment vs. price declines from tech learning rates. Someone had to kick-start this process by for huge deployments when it was uneconomical, to then drive scaling in production. Germany footed the bill. Global deployments then soured after those purchases and price declines.
Perhaps someone else would have done this later, but I don't really care about the historical counterfactual, I care about who's balance sheet the uneconomic debt, to kickstart the virtuous cycle, sits on. So I credit Germany.
Yes, I am attributing a success to the Energiewende that was not part of the initial plan. But I do think it's an important success. Here's reference: https://xenetwork.org/ets/episodes/episode-4-energiewende/
My understanding of the Energiewende, is that it was never focused on climate. Rather is was a plan to create economic energy…
The more advanced (Stanford Energy Symposium) research that I've seen suggests that there is only one possible power source that we can look to long term to meet the energy needs of the world, and that is Solar Energy. Nuclear Energy just won't be possible to build out quickly enough, inexpensively enough - even if we could do it safely.
In particular, check out Nate Lewis's Solar Energy 101 (https://itunes.apple.com/WebObjects/MZStore.woa/wa/viewPodcast?id=385384449#ls=1) - In the Global Climate and Energy Project (GCEP) where he makes a strong case that the only choice is Solar - not because it's a good one, but because there is nothing else out there that can meet our needs (And he spends a bit of time talking about Nuclear Energy, and why it comes up short).
The entire series is a gold mine for people who actually want to talk about energy generation and climate change on an informed basis rather than just making guesses to suit their particular world view.
With that said, one of my favorite futurists, Ramez Naam, who is a big proponent of Wind and Solar (See:
http://rameznaam.com/2015/08/30/how-steady-can-the-wind-blow/ and http://rameznaam.com/2015/08/10/how-cheap-can-solar-get-very-cheap-indeed/) still thinks we should invest in nuclear, as it has an important role to play in regions where renewable resources (Solar/Wind/GeoThermal/HydroElectric etc...) are not available, and as a hedge against storage (which is critical for solar/wind) technology not advancing to…
This is a great long read (if you like log graphs) on how solar prices have dropped more than anyone predicted: https://rameznaam.com/2020/05/14/solars-future-is-insanely-cheap-2020/
> This incredible pace of solar cost decline, with average prices in sunny parts of the world down to a penny or two by 2030 or 2035, is just remarkable. Building new solar would routinely be cheaper than operating already built fossil fuel plants, even in the world of ultra-cheap natural gas we live in now. This is what I’ve called the third phase of clean energy, where building new clean energy is cheaper than keeping fossil fuel plants running. Even in places like Northern Europe, by the later 2030s we’d see solar costs below the operating cost of fossil fuels, providing cheap electricity in summer months with their very long days in the high latitudes. These prices would be disruptive to a large fraction of already operating fossil fuel power plants – particularly coal power plants, that are far less able to ramp their power flexibly...
(hat tip to the Forge the Future newsletter: https://forgethefuture.substack.com/?no_cover=true)
I predict a lot of fossil plants will convert to simply providing inertia for grid stabilisation and charge for the service. They won't burn anything any more and may even demolish their stacks and cooling towers. They will just keep their generators and turbines connected to the grid as a big virtual flywheel to dampen spikes in demand / supply and maintain…
Here's a great recent article about the current and anticipated future prices of energy storage: http://rameznaam.com/2015/04/14/energy-storage-about-to-get-big-and-cheap/
It's based mostly on a recent paper in nature that estimates "that EV batteries in 2014 cost between $310 and $400 per kwh", but anticipates "It’s now in the realm of possibility that we’ll see $100 / kwh lithium-ion batteries in electric vehicles by 2020, with some speculating that Tesla’s ‘gigafactory’ will push into sufficient scale to achieve that."
His numbers roughly agree with yours:
So we’d estimate that at the following battery prices we’d
get the following effective LCOEs (Levelized Cost of Electricity):
- $300 / kwh battery : 33 cent / kwh electricity storage
- $200 / kwh battery : 22 cent / kwh electricity storage
- $150 / kwh battery : 17 cent / kwh electricity storage
- $100 / kwh battery : 11 cent / kwh electricity storage
All of those battery costs, by the way, are functions of
what the ultimate buyer pays, including installation and maintenance.
Ramez Naam has done lots of research/writing about "learning rates" for power technology. Here's a writeup from late last year on lithium ion batteries: http://rameznaam.com/2015/10/14/how-cheap-can-energy-storage-get/
There are two different studies, one which shows a 15% and one which shows a 21% learning rate (decreased price due to volume).
One thing that's worth noting is that lithium ion energy density (Wh/kg) has not increased appreciably in the past few years (~200 Wh/kg) - we're probably maxed out w/o switching chemistries. Oxis and Sony are targeting 500 Wh/kg Li-S batteries for 2019/2020, but I'll believe it when I see it - most of the Li-S research is super gee-whiz (lots of coated nanotubes, nanocomposites, etc) but that stuff never tends to make it outside of the labs, and if it does, will be quite expensive.
Everything that Elon Musk is doing has a foundation on First Principles:
https://medium.com/the-mission/first-principles-and-the-art-of-thinking-like-elon-musk-98658bb36569
tl;dr --
1) Reduce the problem to a question answerable by a hard science like physics, chemistry, or biology, and pay attention to the theoretical limits.
2) If you can, find data on related industries and see if you can find long term trends. (Example: http://rameznaam.com/wp-content/uploads/2015/10/Lithium-ion-battery-price-1991-2005.jpg )
3) Extrapolate into the future.
4) Think of some way to exploit the information you've uncovered to gain a market advantage.
Other helpful techniques: Is there an industry which is subject to some form of bureaucracy which is distorting the market? How can technology be used to disrupt this?