Startups bet on solar panels on every home and building

November 4, 2010 2:21 PM
Matthew Lynley

Add a Comment

Cleantech startups are expecting that the market for distributed solar energy — installing individual solar panels where power is needed — is going to grow as quickly as the personal computer and cellphone markets.

The most cost-effective way to use solar power is to slap solar panels on individual homes and buildings and provide power at a smaller scale rather than create massive solar panel farms. Large solar panel farms require a lot of money to build and to maintain the transmission lines that move the energy from point to point.

A panel of green technology startup executives made the comments at the GreenBeat 2010 conference in Palo Alto, Calif. The panel included Edward Fenster, co-founder of SunRun, Ron Van Dell, CEO of SolarBridge, and Danny Kennedy, founder of Sungevity.

“That S curve, you’ve been through it with the PCs and cell phones in your pockets, that’s what’s going to happen with this business,” said Kennedy. “We’re in the middle of the tide as it rises, so it doesn’t feel like we’re growing — but it’s going to take off.”

One challenge is to include both the technology to capture the solar energy and convert it to usable electricity in the same box, Van Dell said. An initial surge in growth — including a new source of jobs — will come from research and development of those micro-inverters that turn solar panels into a complete product that both captures solar energy and turns it into a useful power source.

But in order to win solar panels some widespread approval and acceptance, you have to make them sexy, Kennedy said. It’s important to give them the same appeal that Apple creates with its products in order to make consumers more willing to put panels on their roofs, he said.

“We have to learn from Apple — it doesn’t matter what motherboard or modem is in that bundle of components,” he said. “What matters is the service, and that you all feel so cool sitting there with your Mac computers.”

http://www.solarenergysystems.com Solar Energy Systems

I have to disagree with the with “experts” on this one. I think solar on the home is great, but it has a limited market of people that can/want to spend money to subsidize solar at an early stage. I love that this is happening, however I believe to make solar truly cost effective like coal is, you have to appeal to large off-site installations such as solar farms or coops. Installing solar on a home is much less cost effective for the consumer than volume purchasing and entering into a group volume program such as a energy coop. There are three advantages of solar installed remotely versus one's home: 1) many homes are not oriented well so the realized output is much smaller than the promised peak. 2) Every home requires a different design – more engineering to be done and more expense, 3) You can't use tracking systems which increase the power output by 30% compared to flat mounted panels. There are more advantages over group projects, but right now this concept is in its infancy. There are a few states that have adopted “virtual net-metering” which is starting down that road. For now, keep installing solar on homes; but keep your eye on solar coops like Colorado's new “solar energy gardens” to take hold and drive solar even cheaper. By my estimates, you can do remote solar for around 50% of the cost of home installations.
http://twitter.com/theinfomancer Infomancer

I think some of your comments are apt (such as how a home's location and orientation having an impact on the viability).But I think you may be missing the point. A lot of your argument is based on the market as it currently stands. What the people above are saying is that we are likely to see this investment jump ahead by leaps and bounds pretty soon. The S curve they're referring to is the curve of diminishing returns. I'm no economist, but it's pretty interesting stuff. It starts with an initial dip (low reward for investment), then rockets upward (toward optimal profit), peaks at a certain point, and heads back down. We've been in the initial dip so far, meaning it's been all investment and almost no payback. But it seems we might be on the way up, and a more “mass market” approach to solar systems might be coming our way soon.Now, whether “soon” means months or years, it's tough to say. But I think they're right to expect that a rapid increase will happen.
http://www.solarenergysystems.com Solar Energy Systems

I totally agree with the S curve that they are talking about. Solar is about to take off. I was focusing more much on the statement “The most cost-effective way to use solar power is to slap solar panels on individual homes and buildings and provide power at a smaller scale rather than create massive solar panel farms”. I don't agree with this point at all. Putting panels on a home is great as a marketing mechanism for solar energy and for a small wealthier demographic that ones to “be the first”, but with such smaller installations you will never be able to benefit from the economies of scale that are available. I do think, however, that we also have added flexibility with PV in that you don't have to raise billions in capital to install a solar power plant. I think the economies of scale can be accessed with installations in the range of 100kW. Although, you can get some pretty good discounts on panels if you buy 100MW at a time PV solar for homes will diminish greatly as laws are passed to give people access to the cheaper solar farms. If you account for the extra power that can be attained with tracking (30 to 40%) as well as reduced cost due to volume buying and volume installation, you can achieve a very good cost reduction over home installations.