Moore's Law for the Solar Market 28 comments
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Several people (myself included) have posited that alternative energy won't likely have its own Moore's Law, the phenomenon in the chip market that lets things get cheaper, smaller and better over time.
It looks like the critics might be wrong.
Charlie Gay, the president of Applied Solar (APSO.OB), the solar arm of semiconductor-equipment-maker Applied Materials (AMAT), says solar panel makers are experiencing steady cost reductions by making solar panels steadily thinner. Manufacturers can't reduce the X and Y dimensions of the solar cell easily – that would reduce the surface area exposed to the sun, which in turn would reduce the power that a given panel could produce.
But by producing thinner wafers, the amount of raw material gets reduced without reducing performance.
"The Moore's Law for solar is that as time goes by, things get thinner and still absorb light," he said during a tour of Building 21 at Applied, where the company conducts testing and research on its equipment. (Gay will be speaking at Intersolar U.S. taking place in San Francisco next week. Our video interview with him will appear on Intersolar TV and on the Greentech Media site next week.)
The latest amorphous silicon solar modules made on Applied's SunFab line, for instance, contain some layers measuring 100 angstroms thick, or about 30 atoms. These sheets of motherglass are 61 square feet in size.
"That is 30 atoms uniformly deposited from one side to the other," he said.
The difference between chips and solar panels, however, comes in how these improvements are implemented. In the semiconductor world, companies shift from one manufacturing node to a more advanced one approximately every two years. "Solar in a sense is more analog. It continues to improve over time," he said.
Gay also defended amorphous silicon. Applied primarily makes equipment for makers of silicon crystalline and amorphous crystalline solar panels, and it is particularly interested in promoting amorphous silicon. Several analysts assert that the future for thin film will be dominated by cadmium telluride and copper indium gallium selenide (CIGS) panels, both of which potentially will provide higher efficiencies than amorphous silicon.
Amorphous, however, is gaining in efficiency, he noted. Some amorphous manufacturers employing Applied's machines can achieve module efficiencies of 8 percent.
Just as important, the manufacturing tools are more standardized, he noted. Makers of other types of thin film panels often have to customize their equipment.
"The question is: What is the technology that can scale?" he said.
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This article has 28 comments:
With companies now doing most solar for under $2/wt panel cost is the lower cost of an installation. As it gets to $1/wt panel cost and standard installations drop install costs thin film I think will take over.
Look for companies that make solar that can be rolled onto a site or as a shed, patio or home roof and plugged in as the next big thing as this will lower costs more than anything else.
Thank the Internet for comments, they make all of the difference.
On Jul 13 12:42 AM rooferguy wrote:
> At a selling price of $7/watt for a system, the cells are only about
> $1.50/watt.
On Jul 13 12:42 AM rooferguy wrote:
> At a selling price of $7/watt for a system, the cells are only about
> $1.50/watt.
The $/W price installed is not solely dependent on the raw panel price. If FSLR is selling systems for $3/W installed they are probably including all incentives that vary from state to state and utility to utility + the 30% Federal tax credit. Also FSLR makes panels, therefore: volume discount. In Wisconsin, the incentive is $2.25/D.C. rated W installed x 1.2. So 5 KW system @ $8/W installed = $40K - ($13.5 K) incentives = $26.5 K - ($7.95K Fed tax credit) = $18,555 total system cost ($3.71/W). That's where the $/W cost is lowered, incentives, not necessarily the price of panels.
You have the panel and BOS costs all wrong. FSLR installed costs DO NOT include any incentives. Get back to me when you can accurately define every cost category of an installed system; Until then, this conversation is out of your league.
$1.65/W modules, $0.30/W inverter(s), $0.75 BOS, Labor $0.90/W
Then add 25-30% margin and you have your $4/W
Don't ask for any "links" or what x, y, and z represent as I will not be sharing them. You will have to do the "leg work".
On Jul 13 10:54 AM dr_cosmo wrote:
> Gentle people:
>
> The $/W price installed is not solely dependent on the raw panel
> price. If FSLR is selling systems for $3/W installed they are probably
> including all incentives that vary from state to state and utility
> to utility + the 30% Federal tax credit. Also FSLR makes panels,
> therefore: volume discount. In Wisconsin, the incentive is $2.25/D.C.
> rated W installed x 1.2. So 5 KW system @ $8/W installed = $40K
> - ($13.5 K) incentives = $26.5 K - ($7.95K Fed tax credit) = $18,555
> total system cost ($3.71/W). That's where the $/W cost is lowered,
> incentives, not necessarily the price of panels.
Assuming x, y, and z are true, then:
> $1.65/W modules, $0.30/W inverter(s), $0.75 BOS, Labor $0.90/W Then add 25-30% margin and you have your $4/W
Uhhh huh. Lets start with $.90/watt labor...
So you pay $180 bucks to install one 200 watt panel? That takes less than 10 minutes to install? So one guy who installs 10 panels in under 2 hrs costs you $1800 in labor?
Who does you accounting -- Madoff CPA?
Splain to me where you're getting inverters for $.30/watt and modules for $1.65/watt, particularly when there are maybe 3 mfgrs who can produce a panel for $1.65/watt when you include SGA...
Maybe you know PV mfgrs who sell their panels at a loss but make up for it in volume.
On Jul 13 12:27 PM Fred W wrote:
> $1.65/W modules, $0.30/W inverter(s), $0.75 BOS, Labor $0.90/W<br/>Then add 25-30% margin and you have your $4/W
Ryan Wiser at Lawrence Berkeley Labs did the best study of real, installed cost trends for both commercial and residential. I know for a fact that the initial "guesstimates" that SoCal Edison and FirstSolar talked about were not met on their first installations.
Here is a link to the LBL study:
eetd.lbl.gov/ea/emp/re...
I have no doubt we'll eventually get down to $3/watt, but we are not there yet.
On Jul 13 09:49 AM Steve Pluvia wrote:
> System prices are NOT $7/watt installed, unless you pay the installer
> $3/watt... FSLR is constructing PV systems for around $3/watt +/-20cents/watt
> (installed costs); Others are promising UNDER $3 watt installed cost.
> Google Fresco Solar.
In was only last year, 2008, that micro invertors for solar came on the market. These allow conversion of DC to AC for each solar panel, making the overall system more efficient by eliminating the bad ripple effect that one shaded or dirty solar panel can have on the rest of the system. Some solar companies are integrating these into their solar panels making installation simpler, quicker, and cheaper.
Stay tuned.
average incentive $2.30
= net installed cost/W $5.50
Wisconsin average installed cost $7.90
average incentive $2.10
= net installed cost/W $5.80
according to the Berkley study 2007. These are realistic #'s although the panel cost has come down, best street price I could find was $2.58/W, Evergreen ES-A-205. Keep in mind ALL BOS components and panels need to be listed for the incentives to qualify. Those 'priced to good to be true' panels are probably not listed. Steve, labor is typically 10% of system cost and it's not just slapping up a 200W panel, your average weekend warrior does not qualify as a 'listed p.v. installer, also necessary for qualifying for the incentives. Overhead, and regulatory compliance is another 29%
of the total cost, that could be factored into the labor cost. Road Runner, good info on the micro inverters, they will, indeed, reduce the labor and D.C. wiring costs.
Fresco Solar just last week promised to install a 1mw or large system for $2.95/watt anywhere in the U>S>A. I have my doubt about Fresco, large utilities contracting with FSLR have fixed prices in the $3 range today.
www.greentechmedia.com.../
Come on guys pls find someone who can assist you in the clue dept.
On Jul 13 03:06 PM dr_cosmo wrote:
> rooferguy, thanx for the link: Cali: average installed cost $7.80
>
> average incentive $2.30
> = net installed cost/W $5.50
> Wisconsin average installed cost $7.90
> average incentive $2.10
> = net installed cost/W $5.80
> according to the Berkley study 2007. These are realistic #'s although
> the panel cost has come down, best street price I could find was
> $2.58/W, Evergreen ES-A-205. Keep in mind ALL BOS components and
> panels need to be listed for the incentives to qualify. Those 'priced
> to good to be true' panels are probably not listed. Steve, labor
> is typically 10% of system cost and it's not just slapping up a 200W
> panel, your average weekend warrior does not qualify as a 'listed
> p.v. installer, also necessary for qualifying for the incentives.
> Overhead, and regulatory compliance is another 29%
> of the total cost, that could be factored into the labor cost. Road
> Runner, good info on the micro inverters, they will, indeed, reduce
> the labor and D.C. wiring costs.
I am in NJ and had a 5Kw solar system installed on my roof in 2005. Back then, the installed cost was $8.50 per watt. With the State and Federal incentives the final cost came to about $4.00 per watt. Now I understand the going price per installed watt now is about $7.50 before any incentives.
The numbers from National Labs are not intended for average home type installations, rather for commercial installations with a hell of a lot of negotiating power because of the size.
Do you have any financial education whatsoever? You can't figure fixed costs (labor) based on variable costs that vary wildly project to project (regulatory costs) -- or fluctuate wildly such as volatile commodities (panel costs).
On Jul 13 03:06 PM dr_cosmo wrote:
"Steve, labor is typically 10% of system cost and it's not just slapping up a 200W panel, your average weekend warrior does not qualify as a 'listed p.v. installer, also necessary for qualifying for the incentives. Overhead, and regulatory compliance is another 29%
of the total cost, that could be factored into the labor cost."
There are a bunch of new innovations -- like micro-inverters and integrated systems -- that can further reduce costs by eliminating BOS components. Paperwork and bureaucratic costs have gone UP. So for ordinary systems, direct and indirect labor hasn't changed much (as described in the LBL study).
Here is a link to Fresco Solar:
www.frescosolar.com/
Looks like a bunch of internet refugees waving their arms around and making ridiculous solar installation cost reduction claims that naive people mistake for reality.
We who comment on Seeking Alpha are too wise for that ;)
On Jul 13 03:10 PM Steve Pluvia wrote:
> Roofer, You cannot quote Lawrence Livermore or any other report conducted
> months or years ago. Price reductions in every aspect of Panels
> and BOS cost over the last 6 months make cost figures from any published
> report ridiculously obsolete. That said, Panel costs of $1.50 are
> below every mfgr's cost (other than FSLR) when you add sg&a.
>
>
> Fresco Solar just last week promised to install a 1mw or large system
> for $2.95/watt anywhere in the U>S>A. I have my doubt about Fresco,
> large utilities contracting with FSLR have fixed prices in the $3
> range today.
>
> www.greentechmedia.com.../
You should consider changing you name/ID on this site.
On Jul 13 12:46 PM Steve Pluvia wrote:
> Next Freddy (AKA Freddy Numbers),
>
> Splain to me where you're getting inverters for $.30/watt and modules
> for $1.65/watt, particularly when there are maybe 3 mfgrs who can
> produce a panel for $1.65/watt when you include SGA...
>
> Maybe you know PV mfgrs who sell their panels at a loss but make
> up for it in volume.
On Jul 13 05:22 PM dr_cosmo wrote:
> Steve:
> do you actually read what anyone says??? you're an idiot, obviously
> the percentages change as the total costs of the install change.
> I'm done. not quite, you're a fucking idiot!!!!!!!!
On Jul 13 04:54 PM skwestorange wrote:
> Folks:
> I am in NJ and had a 5Kw solar system installed on my roof in 2005.
> Back then, the installed cost was $8.50 per watt. With the State
> and Federal incentives the final cost came to about $4.00 per watt.
> Now I understand the going price per installed watt now is about
> $7.50 before any incentives.
> The numbers from National Labs are not intended for average home
> type installations, rather for commercial installations with a hell
> of a lot of negotiating power because of the size.
Our numbers are much more accurate. Many Installed cost numbers are inflated because the 30% fed tax credit is bigger if the total installed cost is bigger. Pad the development costs here, pad the labor costs there.
I guess that's the difference between people who actually install PV systems and those that sit in their underwear and blog about it.
On Jul 13 01:05 PM rooferguy wrote:
> Steve -
>
> Ryan Wiser at Lawrence Berkeley Labs did the best study of real,
> installed cost trends for both commercial and residential. I know
> for a fact that the initial "guesstimates" that SoCal Edison and
> FirstSolar talked about were not met on their first installations.
>
>
> Here is a link to the LBL study:
> eetd.lbl.gov/ea/emp/re...
>
> I have no doubt we'll eventually get down to $3/watt, but we are
> not there yet.
You're confused. I know how the terms and the calcs and given I pay the bill for the labor I'm pretty sure I know what that means also. Bottom you have a line item for labor and one for regulatory costs; labor is typically fixed and regulatory costs are variable.
If you want to join the conversation, try to keep up.
Jul 15 08:45 AM Fred W wrote:
> LOL- Steve, you just disqualified yourself from any further communication...you
> don't even understand what $0.90/W labor means within project cost
> calculations. It is a very basic concept.
> You should consider changing you name/ID on this site.