A Brighter Tomorrow: Solar Power and Its Importance to the World’s Energy Future

March 7th
23 mins read

In October 2018, the Intergovernmental Panel on Climate Change (IPCC) warned that governments would have to take ‘rapid, far-reaching and unprecedented changes in all aspects of society’ to avoid disastrous levels of global warming. The global scientific authority was unambiguous. At the current rate of warming, the planet will reach the crucial threshold of 1.5 degrees Celsius above pre-industrial levels as early as 2030. The impacts—which include stronger storms, more erratic weather, heat waves, floods, food shortages, rising seas, and large scale disruptions to migration patterns—will be felt across ecosystems, communities, and economies worldwide.

To combat catastrophic climate change, we need to drastically reduce the amount of greenhouse gas emissions resulting from economic activities such as fossil fuel use, deforestation, land-use change, and industrial agricultural practices. According to the IPCC, to ensure we maintain a 50-50 chance of limiting warming to around 1.5 degrees Celsius this century, we need to lower CO2 emissions by 45 percent from 2010 levels by 2030 and reach so-called ‘net zero’ by around 2050.

Meanwhile, the global population is rapidly rising, and by 2050, it will have reached approximately 10 billion people, many of whom will have emerged from extreme poverty and will have significantly higher energy needs. To meet their demands, it is expected that we will need to increase current global energy production by over 50 percent.

Climate scientists say that in order to maintain a reasonable chance of limiting global temperature rise, renewable energy sources need to become the world’s dominant source of energy by mid-century. Moreover, according to the International Energy Agency’s World Energy Outlook, ‘renewable energy technologies provide the main pathway to the provision of universal energy access’.

One way to achieve these objectives could be to use the power of the sun, by far the most plentiful energy source available. Over recent decades, the collection of solar energy has become cheaper and easier every year, and rapid improvements will almost certainly continue. In fact, solar photovoltaics (PV) are already one of the cheapest ways to generate electricity in many areas of the world.

However, even after the unprecedented growth solar PV has experienced over the last few years, it’s still only responsible for a small fraction of global electricity production, and electric power is currently only about 25 percent of global energy demand. However, according to the IEA, solar PV is now ‘charging ahead’ and its increasing competitiveness is predicted to push its power-generating capacity past wind by 2025, hydropower around 2030, and coal before 2040.

Launching the latest World Energy Report, IEA executive director Fatih Birol said that ‘if the world is serious about meeting its climate targets, then, as of today, there needs to be a systematic preference for investment in sustainable energy technologies‘.

SPACE10 is a research and design lab on a mission to create better and more sustainable ways of living. Our exploration of the potential of solar PV—the world’s fastest-growing source of new energy—is part of that mission.

This report launches our exploration into solar PV. It provides an overview of the current landscape and examines what solar energy is, how it’s produced, and how the market for it has developed. The report also highlights key innovations and emerging technological trends.

In short, we believe that we are standing on the cusp of a fundamental shift in how we consume, generate and trade energy. With solar PV outpacing growth of all other renewables, we believe that we need to accelerate its growth, use its electricity for more of our energy needs and, above all, make it more accessible and affordable.

Why is solar central to the world’s energy future?

On average the sun delivers about 90,000 terawatts of energy to the Earth’s surface. Don’t worry about what a terawatt is. The important thing is to compare this number to today’s total demand across the world. As of 2015, for all our energy needs, for nearly eight billion people, we require about 17.4 terawatts, or less than one four-thousandth as much. To put it another way, if we could collect just under two hours of the sun’s power each year, we would satisfy all our current requirements. (This isn’t just electricity, but all our needs for our transport, homes, offices and industries.) Granted, this will never be possible; about 30 percent of the sun’s energy is either covered by clouds or reflected by the earth’s surface, while two-thirds hits the ocean. But even after those losses are taken into account, the sun still provides a substantial amount of energy that could theoretically account for all our needs.

Of course, much of the globe’s surface is water, where it is more difficult to harvest solar energy. And in high latitudes, there are frequent periods of little sunshine in winter. Nevertheless, throughout many parts of the world, the sun represents a reliable and truly enormous source of energy.

We can also express the available energy from the sun in relation to the worldwide reserves of fossil fuels in the ground. We cannot be completely sure of the numbers but, very approximately, the planet receives more solar power in a week than the energy contained in all the oil, gas and coal known to exist in the planet’s recoverable reserves.

Moreover, the sun’s rays carry far more energy than the world’s winds, the second-most widely available sources of renewable power. Compare the 90,000 terawatts of solar energy with the less than 900 terawatts that are typically possessed by the winds blowing around the globe (only a small fraction of which is available near the ground and capable of being captured by wind turbines). This is a difference of two orders of magnitude, and in many places around the globe, the wind barely ruffles the trees. The sun is both more pervasive and is available at a vastly greater scale. All other sources of renewable energy, such as biomass or the power of falling water, are further orders of magnitude less significant even than wind.

Furthermore, in 2017, researchers at the Potsdam Institute for Climate Impacts Research published their research into the full lifecycle greenhouse gas emissions of a range of sources of electricity up to 2050. It showed that the carbon footprint of solar energy is many times lower than coal or gas with carbon capture and storage, even after accounting for emissions during manufacture, construction and fuel supply. Carbon Brief spelt out what that means: ‘Contrary to the claims of some critics, [the] research shows that the hidden emissions due to building wind turbines, solar panels or nuclear plants are very low, in comparison with the savings from avoiding fossil fuels.

Now, the world could decide to obtain its energy needs either from nuclear fission (the technology used in today’s nuclear power stations) or from fusion (the capture of the energy generated when atoms are violently combined to form a new chemical element).

However, both fission and fusion have serious problems. For example, the next generation of nuclear power stations have proved both expensive and extremely difficult to build. One scientist said these giant edifices are like ‘cathedrals within cathedrals’ that add enormously to the complexity of construction. The small number of new plants being constructed around the world have almost all been delayed, typically by about a decade, and have run many billions of dollars over budget. Moreover, we have yet to find a cheap and safe means of storing the waste from nuclear fission.

Solar has other advantages. Most sources of renewable energy get much cheaper as the size of an installation changes. Large industrial wind turbines, perhaps of 4 megawatt capacity, may cost several million dollars, but expressed as a price per watt, they are much cheaper than smaller scale machines. That means an increasing fraction of all wind-power installations are of very large turbines indeed, sited in huge farms.

Solar PV is very different. Installing a very large solar farm is certainly cheaper on a per-unit basis, but the costs differ to a much smaller degree. Photovoltaics are more modular than wind; after all, PV panels are significantly smaller and more flexible than the modern windmill. In certain circumstances, it can make as much financial sense to put 1 kilowatt on the roof of a house as 100 kilowatts on a warehouse or 10 megawatts in a solar field.

This is a vital support for the rapid growth of solar. It means that the decision to install PV can be made by homeowners and small businesses alongside the big finance houses that now dominate the installation of large wind farms around the world. It is a loose use of the word, but solar is inherently more democratic than any other energy technology. Among other advantages, this means that the world can employ solar PV to bring electricity to regions with hitherto very limited availability.

The history of solar photovoltaics

NASA launched the Vanguard 1 satellite in 1958. It was the second US satellite put into space in response to the Soviet Union’s Sputnik programme. It sent signals back to the ground for six years. The electricity for these transmissions came from tiny photovoltaic (PV) panels on the outside of the satellite. This was probably the first use of solar panels for practical purposes and extended the useful life of the satellite well beyond the previous battery-powered devices.

The amount of power that the panels generated was tiny, probably a fraction of a watt. In the photograph below is a replica of the Vanguard 1 satellite. Three of the six small solar arrays can be seen, protruding slightly from the sphere that contains the satellite’s electronics.

Satellites today still use solar energy as a key source of power. The International Space Station has huge wing-like panels that extend almost 75 metres from its body. Altogether, these solar arrays can produce up to 120 kilowatts of electricity, perhaps half a million times the power of the photovoltaics on Vanguard 1.

The price of solar panels has declined remarkably since the early days of the technology. Estimates of costs from the 1960s are unreliable because the volumes bought and sold were minuscule, but from the next decade onwards we have good data on the price of panels. In the 1970s a watt of maximum capacity cost approximately €88 (the rated capacity of a solar module is the power generated in full sunshine in the middle of the day at a panel temperature of 25 degrees and when the panel is at 45 degrees to the horizontal). In March 2019, the number was about 35-47 euro cents a watt, a fall of up to 250-fold in the last 40 or so years. This figure will almost certainly continue to tumble.

The rate of decline is driven by a phenomenon widely known as the experience curve, which assumes that the more experience a business has making a product or providing a service, the lower their costs. As the world has got better at making panels, costs have fallen in a predictable way. Broadly speaking, as the total volume of panels ever made has doubled, the market price has fallen about 20 percent. It is the ‘experience’ gained by making panels that drives costs almost relentlessly downwards. We see this phenomenon across a wide range of industries, from semiconductors and gene editing to well-established manufacturing businesses such as paper or glass production. Almost no-one suggests the cost reductions in solar power will stop any time soon.

How do solar panels work?

The sun’s rays are actually bursts of energy called photons. When they hit the thin layer of silicon in a solar panel, a photon may dislodge an electron from one of the atoms. The electron will move from the silicon to the metal electrodes at the front of the panel. This creates an electric charge between these electrodes and those at the back of the silicon. A flow of electricity results from the electron moving in a circuit between the receptor electrodes and back to the front of the panel.

The amount of energy in a photon varies. A photon of relatively low energy—which humans feel as heat—will not dislodge an electron and will pass through the photovoltaic material. However, red light has enough energy and will result in electricity generation. Photons at the blue end of the light spectrum, which carry far more energy, will result in electricity generation, but much of that energy will be wasted as heat.

The theoretical maximum amount of the sun’s energy that can be absorbed by today’s single-layer silicon cells is about 34 percent.

What else do we mean when we say ‘solar power’?

Most attention is paid to solar PV, the conversion of photons of light into useful electricity. We need briefly to consider two other ways of using the sun’s energy.

For hundreds of years, humankind has used the sun to provide hot water. ‘Solar thermal’ collectors directly absorb the energy of the sun’s rays in a circulating fluid. The hot liquid is then passed through a heat exchanger inside the water tank of a home or business, heating the water for use in showers or kitchens. Although some solar installations provide the hot water for large buildings in sunny countries, it is never likely to provide for much of the world’s energy needs.

Secondly, and of increasing importance around the world, is ‘concentrating solar power’ (CSP), which also uses the energy of the sun to create steam, or heat a complementary fluid such as molten salt or synthetic oil to very high temperatures. This steam, or fluid, is then employed immediately to drive a turbine to make electricity, or is stored in a tank for use later when the sun has gone down.

CSP is more expensive than photovoltaics—although, like PV, it is dropping sharply in price. It will probably always be more expensive than conventional solar panels, and its maintenance costs will always be higher, but it makes up for this disadvantage by enabling the production of 24-hour electricity. It works best in areas of very high and reliable solar exposure, since it produces much less power in diffuse sunlight.

Two main technologies exist for collecting the energy in a CSP plant. In the first, the heat collects in a tube placed at the focal point of parabolic arrays. The reflected heat focuses on the thin tube. Inside the tube is a circulating fluid that heats up to temperatures of perhaps 700 degrees Celsius. This hot liquid can either be stored for use later or can be immediately employed in a steam turbine to generate electricity.

The second approach to concentrating solar power is becoming more popular. A very large number of mirrors (“heliostats”) are arranged around a central tower. The sun’s rays are bounced by the heliostat to a heat-collecting tank at the top of this tower. This tank contains a salt, such as potassium nitrate, that melts at high temperatures. The molten salt can be used as a fluid to transfer heat from the top of the tower to a storage tank at the bottom. As with a parabolic array system, this heat can be used immediately to generate electricity or can be kept until electricity is needed, usually during the night.

What is stopping solar taking over today?

In some sunny countries, energy developers install solar farms in return for guaranteed prices of no more than 2 US cents a kilowatt hour. Recent examples of contracts at around this level come from places as diverse as Saudi Arabia and Mexico. In other countries, the price is sometimes higher. India, for example, still pays as much as 4 US cents for new developments. This is partly because the cost of investment capital is higher but also because connection to the grid is sometimes costly or less reliable.

Even with these variations, the cost of new solar power is now falling below the cost of building and operating any type of fossil fuel plant in many parts of the world. In less sunny countries, such as those in northern Europe, onshore wind can sometimes be even cheaper. But, in most of the world, solar PV beats a new fossil fuel power station.

This is the good news. After six decades of research and manufacturing improvements, solar is now pushing down the price of energy everywhere it is used. However, according to the International Energy Agency, it is still only 2 percent of world power output and the rate of growth of solar generation in 2018 will be the lowest for many years. Still, at over 18 percent, that figure is still very high. And more money was invested in solar PV in 2017 than in any other power source—$161 billion compared to $103 billion for fossil fuel power stations.

So why isn’t solar growing even faster? If it is cheaper than any other source of new power, why isn’t all our electricity coming from PV? First, because huge amounts of coal and gas-generating capacity are installed and ready to produce electricity. Usually fully depreciated, their operators will turn the power stations on as long as they cover the immediate costs of generation. They don’t have to bear any capital costs. Although their hourly utilisation is falling, many coal plants around the world may make just enough money to incentivise the owners to keep them open.

Second, in some developed countries, total electricity demand is falling. It is more difficult to invest in solar if power needs are met by existing plants.

Third, solar is both intermittent and, in many places, unreliable. Of course, it can only ever be available for an average of twelve hours a day and clouds can interrupt the flow of power even during the day. Electricity companies can often deal with these problems, but solar requires skills in energy management that aren’t needed with coal or, particularly gas, power stations.

Fourth, storage is still expensive. Electricity can be kept overnight in a battery, for example, but this might double the cost of night-time power in a sunny country.

Why solar growth will nevertheless continue

Despite the obstacles referred to above, solar’s future is bright. It will likely get cheaper and cheaper into the indefinite future. Why?

First, because solar PV panels using conventional silicon will likely continue to decline in price around the world. The fall in price is caused by many separate developments, summarised as the effects of ‘the experience curve’ above. New materials, such as the perovskite and organic molecules referred to below, may replace silicon, which uses a lot of energy to process, and help maintain the pace of reduction.

Second, some solar experts are confident that the efficiency of the typical panel (the maximum percentage of the energy falling on the panel that can be converted to electricity) will continue to increase, albeit slowly. Meanwhile, other improvements will increase the amount of electricity generated from a solar field. The electronics will improve and, more importantly, more PV farms will use tracking systems that move the panels to face the sun throughout the day. These tracking installations can capture at least 25 percent more energy and will particularly increase the electricity delivered at the end of the afternoon, when it tends to be more valuable.

Another important improvement, particularly when combined with tracking, is the use of PV that collects energy on both sides. These panels are called ‘bifacial’, and improve electricity typically by 11 percent.

As confidence in the reliability and longevity of solar power continues to increase, the financial returns demanded by banks and other financiers are falling around the world. This has greater consequences than we might think. Very approximately, a cut from 7 percent to 4 percent in the return demanded reduces the cost of solar electricity by 25 percent.

Moreover, solar equipment of all types will probably last longer. Twenty years ago, manufacturers assumed that panels might lose more than 1 percent of their average output each year and would need to be replaced after 20 years or less. Today, the leading makers guarantee their products for substantially longer time-periods. Trina, the world’s largest manufacturer, promises over 80 percent of the initial efficiency after 25 years. The likely reality is that a solar panel bought today will still be working reasonably productively in half a century. And then it will be almost completely recycled, either into the materials for new panels or for other purposes.

Solar can also provide some unexpected benefits to other users of the space on which the panels are installed. For example, floating solar panels placed in reservoirs can help reduce evaporation, an important advantage in drought-susceptible countries such as India. Meanwhile, solar panels in fields can provide shelter from rain and cold for sheep and goats, improving their growth rates and general health. In a new development, researchers say that in very dry climates, placing solar panels on high frames well above growing crops will improve yields because the PV will block the plants from getting too much sun and losing water. Similarly, solar carports can now produce electricity to charge electric vehicles while protecting the vehicles from getting too hot.

Finally, it is important to note that solar PV is becoming increasingly popular amongst citizens as a source of energy. Even in states in the US that mine coal, and get most of their power from this source, residents prefer solar and other renewables. Politicians therefore have some freedom to encourage the growth of solar. Companies that buy their electricity from solar farms may be be advantaged in the eyes of their customers.

Revolutionary materials

As mentioned above, new materials are emerging that will help solar power become even cheaper. At the moment, most PV panels are made from very thin sheets of silicon, doped with small quantities of phosphorus or boron. Other materials used include even thinner sheets of cadmium telluride or gallium arsenide. However, most solar panels installed today are made from the conventional silicon semiconductors. This may well not be the case in 20 years’ time. Although silicon-based modules are becoming cheaper and cheaper, they still use a huge amount of expensive energy to make and need to be encased in glass and aluminium.

Other materials can function as a photovoltaic material. There are two main types of panel that may in time replace silicon. The first are known as perovskites. The word ‘perovskite’ refers to a particular type of molecular structure. Many different chemical compounds have this shape but some have strong photovoltaic capacity. The best contain metals and halides such as bromine.

Scientists around the world have been rapidly pushing forward with research to try to increase the lifetime of solar cells made with these molecules. Britain’s Oxford PV is among those companies attempting to commercialise perovskite technology. It is seeking to make cells with a very thin layer of perovskite on top of conventional silicon. The perovskite collects the energy from different frequencies of light to silicon, meaning that the total amount of electricity generated by these ‘tandem’ cells should increase.

Oxford PV expects that its perovskite-and-silicon cells will convert up to 37 percent of the sun’s energy into electricity, compared with 29 percent collected by the best silicon-only cells today. Coating a silicon cell with perovskite is easy, so these molecules will end up improving the economics of solar PV. In time, Oxford PV expects solar cells to be manufactured entirely out of perovskites because it will be so cheap.

The second type of material that may replace silicon is known as organic photovoltaics. Many other molecules also collect solar energy and can turn it into electricity. Heliatek, based in Dresden and probably the world’s most advanced producer of next-generation photovoltaics, uses relatively simple organic molecules called oligomers. (In this context, ‘organic’ means containing carbon.) Heliatek’s photovoltaic materials can literally be printed on a light plastic backing sheet and then stored in a roll. Currently, they aren’t as efficient as conventional silicon PV, but they are expected to be cheap to make and easy to install. The trial sites for Heliatek’s organic photovoltaic films include school roofs and the sides of factories.

Will perovskites replace silicon completely? Will every building be draped with light and flexible PV made with organic films? We cannot predict the future. But we can be quite confident that solar photovoltaics will improve in price, performance, durability and flexibility.

Envisaging a solar-powered world

Solar power in the sunniest parts of the world may fall in cost to just under 1 euro cent per kilowatt hour for large solar farms. To put this in context, a homeowner in Germany is currently paying the equivalent of 8-12.5 euro cents for a kilowatt hour. Of course, the household needs to pay for the transmission of electricity and many other costs, but the disparity between the costs of solar electricity at the point of production and how much ordinary power costs to buy is becoming larger by the year. This will continue to encourage both large-scale solar electricity production and the installation of panels on roofs so that home and business owners can save on their electricity bills.

For energy from solar panels to be truly useful, we need to be able to store it for use when required. For storage overnight, or perhaps to protect against a cloudy day, batteries are best. These can work either in the home at a small scale or installed next to large renewable farms to provide huge amounts of storage. As of November 2018, the largest battery in the world is sited at the Hornsdale wind farm in Australia. When dispatching at peak output, the battery can provide enough energy to power 33,000 homes. But its main function is not to store electricity but to help stabilise the electricity market by charging and discharging at useful moments.

Other large battery systems are more geared to holding solar power for overnight use. For example, the islands of Hawai’i are installing batteries to help increase the amount of solar power that can be productively installed. A recently announced typical project sees 120 megawatt hours of storage being co-located with a new 30 megawatt solar system. Increasing numbers of homeowners around the world are installing battery packs in their homes, although it is financially infeasible at this time in most countries.

Of course, homes tend to use most electricity at the beginning and the end of the day. The profile of business use is very different and much better aligned to the power output from a solar array. So it makes increasing sense across large parts of the world for factory and warehouse owners to put as much solar as possible on the roof of their building.

As well as short-term storage in batteries, we will use today’s advanced digital technologies to help solar owners make the most of their power. At the moment, an electricity producer usually sells its PV output to an energy company, who either trades the power or retails it to its customers. Some experts believe distributed ledger technologies will play a vital role in helping solar owners make the most of their power.

Blockchain, for example, is ‘a distributed, digital transaction technology that permits the secure execution of smart contracts over peer-to-peer networks independently from a central authority such as banks, trading platforms or energy companies/utilities’. It is envisioned that in the not-to-distant future, it will allow electricity to be directly traded between generators and consumers, even though they may not be physically connected or even geographically proximate. In other words, it could let people buy energy directly from producers—and, in theory, each side can benefit from cutting out the intermediaries.

One vision is that millions of small generators will be able to sell their surplus solar electricity to remote buyers. The transaction could conceivably be in units as small as 1 kilowatt hour. Settlement of the transaction would occur simultaneously or soon after the generation/consumption had happened. Direct trading would create opportunities to raise revenues and reduce costs. A community-owned solar park, for example, could offer electricity in return for an initial investment. Or a hospital could buy electricity from the roof of a local factory. Blockchain would also make utility companies and grid operators more efficient because they could balance supply and demand in near real-time.

In addition, if buyers knew when the power was being produced, they could adjust their own energy consumption. Imagine having a domestic battery system and doing a deal with the local solar farm. When it produces power, you could buy what you need at a good price and store it. When it clouds over, you would stop importing energy and use the battery to meet your requirements. Utilities and tech companies around the world are running large experiments that directly link the electricity consumption of users to the production from local solar arrays.

Alternatively, imagine owning shares in your town’s solar farm, located on farmland just outside the city boundary. Blockchain-like technologies would enable the farm to allocate your percentage of the total output to fill up your battery as required. When this becomes possible, you’d still have to pay something for your connection to the grid but your power would nevertheless be substantially cheaper than it is today.

Several examples of blockchain underpinning energy systems are in development. In New York City, an energy company and a tech firm have introduced a system that allows neighbours to buy and sell solar power from each other on a blockchain platform that documents their transactions. Likewise, a consortium including a development corporation, a non-profit known as Solar One, a co-operative financing agency and an environmental advocacy group are creating an 80,000 sq. ft. solar garden in Brooklyn. According to Fast Company, ‘once completed, it will be one of the first examples of a cooperatively owned urban power supply, and potentially a model for other city coalitions to follow when looking for mutually beneficial ways to repurpose public rooftops as communal solar energy sources.’

Moreover, in places without electricity grids, solar will increasingly be seen as one of the best ways to deliver the energy that families and small businesses need. Although trending downwards, the number of people without electricity access worldwide remains at around 1.1 billion. Building up the electricity distribution system so that it covers every home in large countries is an almost impossibly expensive task. So large numbers of companies have set themselves up to offer kits for homes, or groups of households, to install solar panels, batteries and highly energy-efficient appliances. These systems are almost always based around solar PV. A report from McKinsey optimistically suggests that up to 150 million households in the developing world could be in a position to benefit from solar home systems by 2020.

Payment for the electricity is usually made by a transfer via mobile phone, including the trailblazing M-Pesa mobile system in Kenya and its equivalents elsewhere. Until recently, community solar systems were sometimes resisted because the local people wanted the grid operator to provide full access to the electricity network. But as the power available from solar systems improves, and the energy requirements of appliances such as televisions and refrigerators fall, more and more people are being served by tiny microgrids covering perhaps a few homes and a community room.

More generally, solar is aiding the gradual process of decentralising the world’s electricity supplies. Twenty years ago, almost all electricity production occurred at a small number of large power stations, almost all using coal, gas or oil. Supply networks fanned out, often for hundreds of kilometres, to reach outlying consumers. Today, generation can occur much closer to the users of the power. Measurements are imprecise, but the average distance between the point of power generation and its eventual use is probably falling for the first time in history.

Among several other beneficial outcomes, this means that network companies need to spend less to maintain or upgrade power links. In isolated areas with good solar resources, communities and businesses such as very remote mines are starting to develop micro-grids that make localities almost self-sufficient. Eventually we may see smaller communities move entirely off the centralised grids in order to save money on transmission costs. Solar makes this possible. After Hurricane Maria devastated Puerto Rico, in September 2017, microgrids powered by solar and using batteries for storage enabled hospitals and other crucial facilities to continue operations while the electricity grid was unable to deliver any power.

The potential role of distributed-ledger technologies may be huge, but there are some caveats. First, both suppliers and consumers of electricity must today pay fees to the distribution company—and regulators are unlikely to let peer-to-peer traders avoid these charges. Similarly, most governments are unlikely to allow peer-to-peer trading that avoids value-added tax requirements. Third, many governments in Europe impose charges tied to consumption levels (for example, in some countries the cost of subsidies for renewable energy is a substantial part of people’s energy bills).

Finally, some industry experts believe there is an important role to be played by advanced electricity metering systems for consumers and generators, which offer demand management and storage incentives and introduce sophisticated time-of-use pricing plans. For example, the UK’s Octopus Energy has introduced a tariff that offers incentives (such as negative, or ‘plunge’, prices) to consume energy when central wholesale prices fall below a certain level.

Towards solar becoming the world’s dominant supplier of energy

It’s speculated that by 2050, solar and wind will generate half of the world’s electricity. Success in holding the world to a temperature rise of no more than 1.5 degrees will depend in part on getting solar to meet these optimistic projections and grow at least two orders of magnitude within a couple of decades.

Is this possible? Growth will be helped by batteries because they enable PV to function as a reliable 24-hour source of power (perhaps supported by standby diesel generators). But batteries are not enough. They don’t provide the high power density needed, for example, by long-distance air transport (one PV airplane, Solar Impulse, has flown around the world, but it carries one person using an enormous array of solar panels. Commercial aviation is impossible using solar power). More importantly, they cannot offer enough power to store energy from one season to another in countries with pronounced variations in sunlight.

Although we need batteries, we also have to have the capacity to store power for months. How do we do this? The answer is surprisingly easy, although it is not financially feasible quite yet: we can use solar electricity to break water into its two constituent elements—hydrogen and oxygen—in a process known as electrolysis. The hydrogen atoms carry large amounts of energy that we can use directly as a fuel for heating or other parts of the energy system. For example, as part of efforts to have a carbon-neutral energy supply by 2020, the Dutch island of Ameland has successfully added sustainably generated hydrogen to its natural gas system.

However, hydrogen is expensive to store, partly because it uses large amounts of space for each unit of energy. So we need to keep hydrogen in forms which are much more convenient. Ideally, we would chemically combine it with carbon dioxide that would otherwise be added to the atmosphere. (Conventional fuels are generally either straightforward combinations of hydrogen and carbon, such as methane, or have some oxygen bound in as well, such as methanol.)

This would allow us to create synthetic fuels that could be used as substitutes for existing fuel sources. In time, these ‘carbon neutral’ fuels could replace all the fossil fuels the world currently uses, allowing us to run the energy-intense portions of the global economy—such as passenger jets—without adding to the global warming crisis.

Of course, to make this solution (and others) financially attractive, the price of electricity generated by solar needs to be pushed down to the lowest possible level. In terms of cost per unit of energy, solar is already cheaper than $75-a-barrel oil, but natural gas is sufficiently inexpensive for synthetic fuels to rely on continuing falls in the cost of solar.

However, if we want to arrest climate change and reduce the growing cost of managing or mitigating its destructive consequences, there are few alternatives other than investing in renewable energy resources like solar. Though we have a very long way to travel to achieve carbon neutrality, solar’s advantages are so great that its future central role in the global energy supply system is assured. The only question we face is how to accelerate its growth.

SPACE10 now hopes to explore ways of leveraging frontier technologies and digital services for financing, producing, distributing, and consuming solar energy in more efficient ways. Ultimately, we want to upend traditional business models and systems to create more economic inclusion for underserved segments of the global population.