An article from the Economist discussed the interesting marketing strategy shift that alternative energy will soon encounter. Alternative energy will, in fact, no longer be ‘alternative’–the whole concept will need a rebranding as “renewable power will start to be seen as normal.”
Solar energy, currently only a quarter of a percent of the planet’s electricity supply, has grown 86% in the last year. This huge jump is very exciting and an obvious contributor to the idea of needing to re-think the concept and naming of ‘alternative energy.’ According to the article, this sector is where we will see the largest attitude shift, with sunlight having the potential to disrupt the electricity market completely.
The underlying cause of this disruption is a phenomenon that solar’s supporters call Swanson’s law, the article says.
Swanson’s law is more or less an imitation of Moore’s law of transistor cost. Moore’s law suggests that the size of transistors (and also their cost) halves every 18 months or so. Swanson’s law, named after Richard Swanson, the founder of SunPower, a large American solar-cell manufacturer, suggests that the cost of the photovoltaic cells needed to generate solar power falls by 20% with each doubling of global manufacturing capacity. The upshot (see chart) is that the modules used to make solar-power plants now cost less than a dollar per watt of capacity. Power-station construction costs can add $4 to that, but these, too, are falling as builders work out how to do the job better. And running a solar power station is cheap because the fuel is free.
The article goes on to compare cost of wind and solar power with that of coal-and gas-fired plants.
Coal-fired plants cost about $3 a watt to build in the United States, and natural-gas plants cost $1. However, this is before the fuel to run them is bought. In sunny regions such as California, then, photovoltaic power could already compete without subsidy with the more expensive parts of the traditional power market, such as the natural-gas-fired “peaker” plants kept on stand-by to meet surges in demand. Moreover, technological developments that have been proved in the laboratory but have not yet moved into the factory mean Swanson’s law still has many years to run.
Of course, there is more to consider than just cost, like reliability of supply. We are dealing with nature, so the sun isn’t always shining, and the wind isn’t always blowing. However, the issue of reliability is the subject of intensive research by many academic and commercial organizations working on ways to store electricity when it’s in surplus so it can be used when it’s in short supply.
With all the excitement and progress comes one downside that the article presents–subsidies. Subsidies for wind and solar power have fallen over recent years, and will continue to fall. Though subsidies will not disappear entirely, the idea that they are ‘alternatives’ will soon dissipate and they will be seen as able to stand alone in a way that was not true in the past.
Regardless of the consequence of falling subsidies, we are thrilled to share that here we are in 2013 and alternative energy is slowly becoming more and more normal.