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solar energy

15 June 2021

Finding a way to store electricity in an efficient and affordable manner is the holy grail for the democratization of people’s access to electricity.

If we think that, in just one hour, the sun shines enough energy to power the whole planet for a year, it is easy to understand that, from all renewable sources, solar is the most powerful and the one with the greatest potential yet to explore.

The past ten years have been a golden decade for the solar panel industry. The cost of solar modules has fallen dramatically and photovoltaic technology (PV) has seen a major improvement in its performance and efficiency. As a result, over the years we witnessed a rampant ascent of total PV installed capacity: between 2008 to 2018, solar energy went from generating 11 721 GWh to 550 000 GWh, worldwide.

Solar power plants and distributed power generation solutions are increasingly attractive investments and becoming less dependent on public incentives or subsidized schemes.

In 2013 the European Commission stated “renewable energy – both wind and solar – was for a long time a new technology that needed state intervention to develop.” However, “with technological progress, investment costs in solar panel falling and production expanding, many Member States have started a reform of their support schemes for renewables.”  

Every year all around the globe more solar projects are being developed in market conditions - as opposed to subsidized or guaranteed remuneration conditions (e.g. feed-in tariffs), where solar PV developers have little or no market risk - and with the lowest contract prices ever. According to the International Energy Agency, “in 2020 solar PV developers won auction bids at record low contract prices, ranging from below USD 20/MWh to 50/MWh”. In the end, this means electricity is becoming cleaner and cheaper for consumers.

In Portugal, from 2012 to 2021, the installed capacity of solar power plants skyrocketed, being the one which grew the most (in relative terms), more than quadrupling from 244 MW to 1067 MW. With over 300 days a year of sun on average, it is most likely that the bullish trajectory of new solar capacity will continue in full force.

Despite the potential of solar energy and the widely positive evolution witnessed these last years, the sector is still facing some challenges – namely the storage of the energy produced by the panels. As the amount of energy the Earth receives from the sun is constantly changing depending on factors as the time of day or weather conditions, intermittency and low predictability of solar power are still seen as constraints to its mass adoption in modern societies, where every second we need to have power readily available to supply demand in national electric systems. With no truly effective and competitive battery technology to this date, over time we have developed different ways of storing energy indirectly.

One of the most common indirect energy storage solutions is pumped hydro storage: using renewable energy surplus - when wind or the sun are generating more energy than needed at a given moment - and use it to power pumps or turbines to fill water dams. Later, when power is needed, the water is released, and the potential and kinetic energy stored in the dams is used to power its turbines and generate electricity.

Although indirect ways of e-storage definitely have a role to play in mitigating the intermittency of solar power and other renewables, such solutions alone are not enough to capitalize on the sun’s full potential.

Multiple companies and energy players are fully committed to researching and developing possible alternatives and though none is established as a clear winner, there are some very promising technologies being created (think of Tesla’s Powerwall or Powerpack, highly efficient lithium-ion rechargeable batteries, or Cellcube’s redox flow batteries).

Energy storage and distributed power generation go hand in hand and seem like the natural way of making a greener, more just and sustainable world. Shortening the way between the place of generation and consumption of electricity reduces the need for big bulk power plants and energy grids, as well as energy losses and shortage, while improving safety of supply and lowering the impact of energy generation on our environment.

Developing efficient and affordable batteries that can store energy to be used at our convenience will be the ultimate game changer for the energy sector and, most importantly, the Holy Grail for the democratization of people's access to electricity.

By empowering distributed generation and consumption, solar PV combined with effective batteries can exponentially improve living conditions for billions of people around the world and fulfill the fundamental and basic need for everyone to have access to a constant and reliable power supply.

Around the world governments, institutions and energy players are understanding the importance of distributed power generation and envisioning the profound change this can bring to people's lives. Utility and power companies are evolving and changing their business models and the services they offer, providing new solutions to their customers and enabling local electricity generation using renewable sources.

In the timespan of 5 years, Portugal’s solar energy production doubled. Energy companies like EDP already offer their customers the possibility of installing solar panels at their homes and produce part of their electricity, allowing them to reduce their electricity bill and making their consumption green and sustainable. At the European Union level, the European Commission is also keen on championing solar energy generation under its Energy System Integration Strategy, which is part of the European Green Deal.

Cost reduction and technology improvement have come around for solar panels but has yet to happen for battery and energy storage solutions. The path to making solar energy a global reality is about half-way today and important work remains to be made.

Nonetheless, in light of the current mobilization of science and technology, increasingly green and sustainable public policies by governments and the investment in research and development for smart grids and efficient energy storage solutions, by public and private institutions, there are reasons to hope that the XXI century shall make way for Planet Earth to enter a bright solar era. 
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If you have any questions about the event please do not hesitate to contact us: business.summit@edp.com

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EDP group companies operating in the liberalized energy trading market: EDP Comercial (Portugal); EDP Clientes (Spain); EDP (Italy); EDP Smart (Brazil) and EDP Energy (Poland).
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