Clean Energy | Article

Is Solar Ready to Play a Part in Your Company Operations?

Solar is finally overcoming cost challenges to provide a viable, renewable energy source.

Written by: Adam Kimmel

Solar power is one of the purest forms of renewable energy. Producing about 173,000 terawatts of energy to the Earth (a fraction of its total output), the sun provides much more power than energy users on Earth can currently consume.

Although solar energy is free to receive, storing and converting it to usable energy remain significant challenges. Each of those steps requires significant investment. Further, each step that changes the energy’s form consumes exergy, hindering the energy efficiency of the process. For these reasons, solar accounts for less than 5% of the electricity supply in the United States.

Economics and efficiency

To bridge the gap between the current high cost of the small number of U.S. solar energy systems, solar adopters receive a government subsidy when installing solar technology as an incentive. As more users join the market, in theory, the costs should come down, and the subsequent scale economy will replace the subsidy to keep the prices low. Still, the high first-cost of solar equipment installation—coupled with the relatively low cost of fossil fuels—have delayed the adoption of solar power.

Silicon wafers, the incumbent solar energy technology, carry a high cost that has been buoyed by the subsidies. With the increased pressure on solar companies to demonstrate progress to support the electrification movement, the subsidies have been slowly decreasing. The cost of conventionally generated electricity continues to increase, though, creating an opportunity for the emergence of innovative solar systems to enter the market.

One significant disruption: photovoltaic (PV) technology, which converts solar energy directly to electric current. The “concentrating” version of this technology uses lenses or mirrors to focus a concentrated beam of solar energy into high-efficiency solar cells. Another approach is to use semiconductors to strip the electrons away from the atomic bonds and send them in one direction to create direct current flow. Both of these processes convert solar energy into direct current electricity using solar cells, offering improved efficiency over traditional methods.

Recent advancements (including the proliferation of PVs) have driven the costs down. The average price of a PV system has dropped nearly 60% over the last decade, according to the Solar Energy Industries Association.

With the increased pressure on solar companies to demonstrate progress to support the electrification movement, the subsidies have been slowly decreasing.

Wilkinson Solar Energy Center

With costs coming down and system efficiencies going up, some companies are taking the step to integrate solar power. Microsoft and Invenergy announced a joint project earlier this year for a 74 megawatt (MW) solar system. The facility, the Wilkinson Solar Energy Center in North Carolina, will provide exclusive renewable power to Microsoft. With the addition of this power, and other similar projects, such as the just-announced sustainable datacenters in Arizona, the tech giant now has a renewable energy capacity of 1.5 gigawatts (GW). The company has stated that pursuing renewable energy enables sustainable growth of its business.

“Solar is a substantial and growing part of our overall portfolio, as the price of solar has grown increasingly competitive and megaprojects that deliver the MWs we desire become more common,” said Brian Janous, general manager of energy at Microsoft. “Last year, Microsoft announced the purchase of 315 megawatts of solar energy from two solar projects in Virginia—the single largest corporate purchase of its kind. The projects, Pleinmont I and II, will house more than 750,000 solar panels spread across more than 2,000 acres and produce around 715,000 megawatt-hours annually.”

In addition to the environmental benefit to employing large-scale solar energy, the total expected economic benefit to the local area is $20 million. Partnerships that create jobs, bolster the local economy, and advance businesses toward a renewable future allow all parties to win. The exponentially decreasing cost of solar technology enabled this partnership.

Should businesses implement solar?

Previously a barrier to employing solar power, capital investment and cost per kilowatt-hour have decreased to a level that is encouraging partnerships and adoption of the technology. Seeing global tech leaders like Microsoft invest in such technology typically motivates other companies to make the leap as well, as the large firm provides confidence in the approach.

With government money still available for solar implementation, the time has never been better to consider solar power as a renewable energy solution.