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Published Dec 1, 2022

Unpopular solar opinions, 2022 edition | Catalyst with Shayle Kann

Shayle Kann and Jenny Chase delve into the intricate world of solar power, dissecting economic dynamics, forecasting challenges, and technological advancements. They emphasize the importance of leveraging existing technologies over chasing new breakthroughs and critique industry trends impacting global solar growth and sustainability goals.
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Episode Highlights

  • Incentives

    The discussion on solar incentives highlights the potential pitfalls of overly generous policies. notes that while incentives can spur rapid solar development, they often lead to unintended consequences, such as market overheating and international trade tensions 1. She references past instances in countries like Spain and Romania, where generous incentives led to unsustainable growth and eventual policy rollbacks. adds that in the US, tax credits are rarely retracted, making it unlikely for existing incentives to be pulled back 1.

    Once we've given something away, it's tough to pull back. And usually there is a strong constituency that emerges in favor of keeping the thing.

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    This dynamic creates a complex landscape for solar policy, balancing growth with sustainability.

       

    Auctions

    Government-led auctions have significantly influenced solar project economics, often driving prices to unsustainable lows. explains that developers frequently bid aggressively low to secure contracts, leading to projects that are financially unviable when market conditions change 2. This has resulted in numerous projects being stalled, as the economics no longer align with the initial contract terms. recalls similar situations in the US, where early power purchase agreements (PPAs) were renegotiated due to drastic changes in market prices 2.

    You do have projects that have just been stuck in not proceeding hell, because the economics no longer work for the contracts they're locked into.

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    This highlights the need for more adaptable and realistic auction frameworks.

       

    Bottlenecks

    Labor shortages and grid access issues are critical bottlenecks in solar installation rates. points out that as demand for solar grows, the labor challenge intensifies, requiring more trained personnel to meet installation needs 3. adds that grid access is a significant hurdle, with many regions lacking the infrastructure to support new solar projects 4. She notes that while some areas, like parts of Western Australia, have attempted solutions, they often result in high curtailment due to congestion.

    The grid is not infinite. There are not an infinite number of sites that are suitable for solar or to put it another way, unsuitable for other uses that are also next to grid connection.

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    Addressing these challenges is crucial for the continued expansion of solar energy.

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