Oct 112010
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The biggest roadblock for the commercialization of solar power in the United States is not the technology but the mundane back-end issues of permitting and installation.

The biggest roadblock for the commercialization of solar power in the United States is not the technology of the modules but the mundane back-end issues of permitting, installation, electrical controls and business practices, according to a report by the Rocky Mountain Institute.

The report, summarizing the institute’s design charrette in June, concludes that “balance of system” (BoS) costs — everything other than the modules themselves — could be cut in half through streamlined, standardized approaches.

“Although solar PV has reached grid parity in select markets, significant reductions are still required to make it a true ‘game-changer.’ Technology development and economies of scale have helped manufacturers of both crystalline silicon and thin film PV modules create aggressive yet credible cost-reduction roadmaps,” the report says.

That makes BoS costs — representing about half of typical commercial and utility project costs — critical to overall cost reduction for solar, the report says.

Cutting the costs of solar, including modules and supporting systems, by half from $3.50 or more per watt currently would establish solar as a viable option without subsidies, experts agree. “As $1 per watt everything becomes possible,” said Energy Secretary Stephen Chu.

The institute’s study concludes that back-end costs, now averaging $1.60 to $1.85 per watt, could be reduced to 60 to 90 cents. (The lower price is for ground-mounted systems; the higher, for units on rooftops.) Such a cost cut would offer “a pathway to bring photovoltaic electricity into the conventional electricity price range,” the report concludes.

Increased solar installations, notably in California, have already helped reduce BoS expenses and total costs, said Thomas Rooney, president and CEO of SPG Solar, the second-largest solar installer in California.

No need for a technological ‘miracle’

“Scale matters in this industry,” Rooney said in an interview. A 1-megawatt solar project would have cost $8 million and taken six months to install two or three years ago, he said, requiring 14,000 worker-hours. Today, it can be done for $5 million, in six months, with 4,000 hours on the job, he added.

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