Written Evidence from Welsh OPTO-Electronics
Forum Photovoltaics Group
A PV Solar Energy Road Map for Wales
REPORT OF THE WELSH OPTO-ELECTRONICS FORUM
PHOTOVOLTAIC GROUP: JUNE 2006
The WOF PV Group strongly recommends the following
Actions in order to secure the successful future development of
the PV industry in Wales.
The need for government stimulation
is paramount. This may be via direct investment, via regulation
(eg building regulations) and via example/demonstration (ie inclusion
in new public buildings).
The industry should seek to fill
identified gaps in the supply chain via inward investment, new
start-up and spin-out companies and demonstration programs.
The research infrastructure should
be stimulated to ensure that Welsh PV research remains at the
leading edge. This applies to all forms of research and development,
including universities, industrial R&D and other organisations
such as Technium and WERC.
Public education and awareness should
be promoted, both as a long-term strategy and in order to support
any Government initiatives. To this end the Group recognises a
need for developing media relations via a press officer, and also
for appointment of a high-profile Welsh PV "Champion"
The Welsh Opto-Electronics Forum (WOF) Photovoltaic
Group was formed in recognition of the unique opportunities currently
existing for the Photovoltaics (PV) industry to establish a strong
base in Wales.
PV is a rapidly growing technology industry
and the Group recognises and supports the high quality of current
Welsh expertise in a large number of major supply chain links.
The Group aims to represent the industry in
Wales as a whole, to facilitate building upon the existing skills
base in order to strengthen the industry further, and to act as
an advisory and information-disseminating body to present the
overwhelming case for PV as part of an integrated energy policy.
Members of the Group include industrial manufacturers
and installers, university researchers and Government representatives
at both Welsh Assembly and Local Authority level.
2. PV TECHNOLOGY
Photovoltaics is an attractive, clean, renewable
energy source with many advantages as part of an integrated energy
policy. Its suitability for integration into the built environment
enables it to side-step some of the issues associated with other
renewable and clean energy options.
Photovoltaics includes a whole raft of current
technologies, from the mature crystalline silicon technology,
through various types of thin-film technology (amorphous silicon,
compound semiconductor (GaInP/GaAs) and polyctrystalline compound
semiconductor (CIGS, CdTe ), to dye-sensitised (Gratzel) cells
and the newer nanocrystalline and polymer technologies. Thus there
is a range of potential solutions to match various application
requirements, and also a range of approaches to the important
issue of reducing the cost (Cost per Watt) of PV-generated power.
This cost is dependent upon a number of different
factors, including materials costs, energy costs, yield (throughput)
and conversion efficiency. For example crystalline silicon technology
is currently able to obtain the fairly high conversion efficiency
in production of around 18% (around half of the theoretical maximum
limit), but the materials costs are high compared with thin-film
technologies, and the current world shortage of silicon represents
a limiting factor. Similarly thin-film GaInP/GaAs cells have high
manufacturing costs which are offset by the higher achievable
conversion efficiencies of 35-40% (depending upon cell design),
while polycrystalline thin-film technologies with lower conversion
efficiencies have potentially lower manufacturing costs. Some
of the newer technologies, while currently having conversion efficiencies
of only a few percent are potentially extremely cheap to produce.
Clearly then, research and development is an important ongoing
element of the PV industrial support structure and will undoubtedly
play a vital part in informing and driving future industry success
in reducing the cost per Watt to a competitive level.
Fig 1 shows the projection of the European Photovoltaic
Industry Association (EPIA) on reducing PV energy costs in Europe.
The figure shows that PV is expected to achieve competitive price
levels (in Northern Europe) by 2020. This projection takes into
account the expected levels of government stimulation for the
industry in countries such as Germany and Spain. The WOF PV Group
believes that investment and support for the PV industry in Wales
at the present time will ensure that Wales also has the industry
and infrastructure to take advantage of what is clearly expected
to become a major source of renewable energy in the future.
Although, the short term view is that PV Solar
energy is expensive compared with conventional fossil fuels, the
projection is that it will become price competitive in Wales beyond
2020 as indicated in Fig. 1. The proposed strategy is to have
substantial support to expand the installation programme in Wales
up to 2020 so that there is the capacity for economically viable
expansion beyond 2020.
PROJECTED REDUCTION IN PV ENERGY COSTS IN
EUROPE. REPRODUCED FROM THE EUROPEAN PHOTOVOLTAIC INDUSTRY ASSOCIATION
(EPIA) ROADMAP DOCUMENT1
Other important advantages of PV as part of
the energy supply structure result from its distributed nature.
This makes it ideally suited as part of a strategy to ensure supply
protection against terrorist threat and security of supply via
diversification of production. Furthermore it reduces stresses
on the grid system which can arise from large localised inputs.
3. PV IN A
Germany is the world's leading PV adopter and
has the largest share of the global market, with Germany, Japan
and the US accounting for fully three-quarters of the market at
the present time2. The cost of PV is falling year on year and
production increasing rapidly. In 2005 a total of 1,727 MWp of
PV cells were produced, representing an increase of 45% over 2004.
This is part of a steady growth trend over a 15 year period3,
largely due to market introduction programmes, rural electrification
programmes and materials and process technology development.
Figure 2 shows the distribution of worldwide
PV installation in 20042. The UK represents less than 5% of the
8% European (excluding Germany) share. Nevertheless an increase
of around 40% per annum in the UK would generate 23% by 20234.
DISTRIBUTION OF WORLDWIDE PV INSTALLATION
Despite the small contribution of the UK to
worldwide PV installation, the UK has several major manufacturers,
including Sharp, the world leader with a market share of 24.8%
The EU is committed to achieving 12% (total)
and 21% (electric) energy via renewable sources by 2010 in order
to comply with the Kyoto Protocol. However, there exists at present
no unified European PV policy. This has led to widely different
approaches by the various member states. Between 2001 and 2003,
PV in the E.U. doubled as a result of the highly successful German
programme (accounting for 70% of installations). Installations
in Spain and Austria also doubled during this period. The success
of the German programme is attributable to a strong government
support programme introduced in 2000 and updated in 2004, and
utilising feed-in tariffs and guaranteed prices paid by utilities,
as detailed in the European Photovoltaic Industry Association
(EPIA) Roadmap document1.
A total of 6,000 MWp PV capacity is forecast
for the EU by 2010. New installations are expected to increase
at a rate of 20-25% per annum, with research and development programmes
resulting in steadily decreasing costs.
4. THE CURRENT
While the potential domestic market in Wales
is relatively small, the quality and range of expertise and the
existing industrial supply base offers an excellent opportunity
for its development as a key centre in the worldwide PV market.
Established manufacturing expertise includes
module assembly (Sharp, market leaders operating in Wrexham) and
world-class III/V (compound semiconductor) production (IQE, Cardiff)
together with substrate manufacturers and systems and installation
companies together representing many years of successful experience.
The PV research capability in Wales is also
broadly-based and well-integrated, with particular strengths in
fundamental thin-films and materials (Bangor) as well as power
electronics (Swansea), energy efficient building design (Cardiff)
and hydrogen energy research (Glamorgan).
Appropriate specialist personnel are currently
readily available in Wales, and the capacity exists for local
training programmes to cater for an expanding requirement.
Overall this provides many strong elements in
a complete PV supply chain, and is a good basis for addressing
some of the remaining identified weaknesses such as cell manufacture
(particularly crystalline silicon) and quality assurance and testing.
5. FUTURE OPPORTUNITIES
The Welsh Assembly Government is committed to
a sustainability agenda. Its devolved Planning function, together
with the developing nature of the Welsh Energy Policy provide
a unique climate for stimulated development of a strong Welsh
PV offers an opportunity to maintain
a serious commitment to sustainability while mitigating some of
the problems associated with other clean energy sources arising
from the sensitive nature of much of the Welsh environment and
Wales is geographically compact with
a degree of autonomy which encourages good communications and
mutual support networks within industry, within research groups
and between industry and research. It is therefore well-placed
to develop a complete, relatively independent multi-faceted technology
The domestic market is capable of
responding quickly to stimulation provided by the Government via
Planning or Building Regulations support (eg guidelines with respect
to public buildings and/or new housing build). Because Wales has
only 22 local authorities (compared with over 300 in England)
there is an enhanced possibility of developing a coherent Welsh
PV strategy. In Wrexham alone there are some 15,000 local authority
housing properties requiring major renovations in the near future.
A large-scale housing stock renovation program would provide opportunities
for new PV installations in a similar way to the opportunities
provided by new build, and the provision of low-cost energy throughout
their lifetimes would help to offset the initial installation
costs. The current need for renovation programmes is not unique
to Wrexham, but exists throughout Wales as a whole.
The status of the grid in some areas
of Wales makes the low-power, distributed input offered by PV
a more attractive option than large-scale localized input which
may cause difficulties by straining the grid's local capabilities.
A Government-led support programme
for the PV industry in Wales would have the knock-on effect of
indirectly supporting the Welsh economy as a whole, attracting
private investment and providing more high-quality jobs.
The WOF Photovoltaics group believes that a
target of at least 10% of renewable energy generated via PV in
Wales by the year 2020 is a realistic expectation.
The WAG Energy Wales Route Map document5 target
for renewable energy generation is 7TWh by this date. This would
require a total installed PV capacity of 875MW. This is easily
achievable within the present manufacturing capacity in Wales
875MW installed capacity is equivalent to around
437,000 houses each with small 2kW rooftop installations, or fewer
if larger installations on public buildings and factories are
also contributing to the total.
1 European Photovoltaic Industry Association
(EPIA) Roadmap. (Fig 1: Original Source: RWE Schott Solar)
2 Strategies Unlimited: Global Analysis of PV
Markets & Application Forecasts.
3 Solarbuzz Solar Energy Facts: Global Performance.
4 P Maycock, Renewable Energy World, August 2005.
5 Welsh Assembly Government: Energy Wales, Route
Map to a Clean, Low-Carbon and more competitive Energy future