Grid parity marks start of solar power boom in Australia

Supplied by: Solar City Enterprises

The benefits of solar power have been well known for more than 20 years, but the alternative power source is still knocking on the door, yet to break into the mainstream. New technology and "grid parity" means that should now change, and if you haven’t already, now is the time to reconsider solar.

In Germany solar power accounts for some 2 per cent of the country’s total electricity consumption, in Australia that figure is 0.2 per cent.

Considering Sydney has 3000 odd hours of sunshine per year, twice as many as Berlin, you might be forgiven for thinking the numbers were the wrong way around.

In pure capacity terms, Germany is presently deriving 60 times as much power from solar energy as Australia. The Germans predict by 2050 the country will be receiving 25 per cent of its power from solar. If the same capacity was applied in Australia, by 2050 it would comfortably account for 100 per cent of our power requirements.

Whether Australia is a late adopter or Germany is ahead of the curve is open to debate, but the point is clear – the solar boom is on, and if you haven’t already considered solar, now is the time to do something about it.

Peter De Martin, director of Sydney-based Solar City Enterprises, says a key reason solar is set to boom is not only thanks to the Australian climate and an awakening in the Australian consciousness of alternative energy, but just as importantly because of "grid parity".

Grid parity simply means the cost of solar power is now the same, or cheaper, than that of coal-fired electricity. In other words you are now no longer looking at paying a premium for the right to consider yourself sustainable.

"Europe went crazy for solar, simply because the cost of power was so expensive. In Germany they were paying something like 90 euro cents per kWh, that’s why they all went solar mad," De Martin says.

"In Australia power has gone up 62 per cent in the last four years. Not that long ago it was 12 cents per kWh, now its 25 cents. Once power hits 40 cents per kWh people will start thinking they have to do something about this. But we’ve hit grid parity so it makes sense to do it now."

The economics are straightforward. If you put a solar system on your roof you are going to be paying ten to twenty cents per kWh over the next ten years, if you don’t you are paying 27 cents per kWh right now, and that’s going to be going up 10, 15, even 20 per cent every year for the next six or seven years.

"It won’t be long before we are paying 60 cents per kWh for power, but if you’ve invested in your own solar kit, you are still at around the 10 to 20 cent mark for the next 10 years after which it’s free," De Martin says.

Of course solar power is still an investment, and should be viewed as such according to De Martin, but it’s an investment with a six or seven year payback and a 30 or 40 year lifetime.

"If you invest the money you will get it back," De Martin says matter-of-factly.

And that’s still the case whether you are occupying the same building in 40 years, or move tomorrow.

"If you have a solar kit on your roof that saves you $2000 per year, you’ve added $40,000 worth of value to your property, that’s a fact," he says.

So if solar makes obvious financial sense for your home or business, what about the practicalities, is solar right for everyone?

"I think solar is right for everybody, but the people who have constant power usage throughout the day it will suit them better than a factory that only has the lights running, then all of a sudden the machines come on," De Martin says.

"For industries where a whole lot of people come in in the morning, turn on all the machines and lights, and in the afternoon turn everything off, solar is perfect for them, obviously it is different for 24 hour operations.

"It’s perfect for 8-10 hour shift operations where they consume most of their power during daylight hours, and that’s where they can really get a benefit from putting solar on. But even if you do run multiple shifts you are still capitalising during the day."

So if solar technology ticks the boxes as far as the economics and your specific business requirements, what about the technology itself, and how should you go about the process of deciding what company to work with?

De Martin cautions that much like with the government’s home insulation scheme, solar rebate programs meant a lot of people jumped on board the industry simply because of government support, and have just as quickly left the industry when as is the case in NSW and Western Australia, the government support dried up.

The message is simple - deal with a reputable, long-standing firm, but more than anything look at the technology itself, because there is a huge difference between the capabilities of traditional systems, and for example the groundbreaking Solar Edge system that Solar City Enterprises itself represents.

Solar technology has just experienced its "eureka" moment, and inverter technology has broken through in the last 12 months to radically improve the efficiency of solar power for your business. The difference between installing 12 month old technology, and a modern Solar Edge system, could be in the order of a 25 per cent efficiency gain. De Martin explains.

"With a traditional solar kit you have an inverter, and connected to that inverter are a number of panels. The panels are in series and the wiring from the inverter is linked to each panel, then the last panel back to the inverter, just like your Christmas tree lights," De Martin says.

"And just like your Christmas tree lights they are all wired up in series, and if you take one light out, or in this case one panel, they all stop."

In other words with traditional systems they are only as strong as their weakest link. If an average solar panel is 200W, and you string together ten panels, you might reasonably expect each panel to give you 200W of power, plus or minus 3 per cent for manufacturing variances.

However, this is not how traditional systems work, and if one panel for any reason is operating at 150W, every panel in the string will operate at 150W, and you’ve immediately lost 25 per cent across the entire system.

"So if one panel which is 200W drops down to 50W because it’s shaded, all the panels drop down to 50W," De Martin says.

With Solar Edge this doesn’t happen. Each panel operates independently with its own power box, so if you take a panel out of the system, or it becomes shaded, only that panel is affected, and all the others in the system continue to operate at their maximum efficiency.

You can easily be looking at up to a 25 per cent power advantage with Solar Edge as a result. Multiply that across a major commercial installation, with say 50-100 panels, and what you stand to lose with traditional systems starts to become alarming.

"For commercial systems where they might be putting 50-100 panels on, big systems, with traditional technology you can only do strings of 10-12 panels maximum. If something happens to one of those panels that string will stop but the others keep going, but you don’t know about it," De Martin explains.

"You see the power still running on your inverter, but it isn’t until you see your next statement you say ‘crikey we are 20% down there must be something wrong with the system’. You could be down for 3 months before you even know about it."

Not so with Solar Edge. Sophisticated web portal monitoring means as long as you turn your computer on every morning, or check your iPhone for which there is an app, you can look at your system and any problem will be instantly flagged and you’ll know about it.

"If you are looking at solar, focus on what the inverter can do," De Martin insists.

"You are going to pay a premium for this technology but it’s the future, if you go for the old stuff you are buying yesterday’s technology.

"When you are talking large scale the investment is big, and you want to make sure you are harvesting as much as you can out of every panel as you are spending a lot of money.

"Make sure you are getting the most out of it, and if you do have a problem you know about it straight away not in two months’ time."

Still not sure if solar is right for you? Then talk to an expert. Solar City Enterprises will work with you to come up with the right solution – looking at your power consumption, how you use it throughout the day, and coming up with a solution that fits.

"We can streamline the installation to follow your usage better, you just can’t do that with traditional systems, the technology is just brilliant, there is nothing like it," De Martin says. 

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