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09/20/2012 08:53 AM     print story email story  

DOE Launches Competition to Vastly Reduce Solar Costs

SustainableBusiness.com News

The US Department of Energy (DOE) has launched a $10 million competition to install solar systems at a fraction of today's price.

It's part of the SunShot Initiative, which has a goal of making  solar energy competitive with other forms of energy without subsidies by the end of the decade. 

The three-year-long contest will award $10 million to the first three teams that can demonstrate scalable approaches to installing solar for $1 per watt or less for small-scale PV systems serving either homes or businesses.

DOE's goal is to reduce the soft costs of installing solar by 65% - to $0.60/ watt by the end of this decade. Soft costs include anything other than solar hardware, such as permitting, licensing and connecting to the grid. 

Even though solar panel costs have dropped dramatically - by about 75% over the past four years - soft costs remain  relatively high. Permitting and inspection alone adds $0.50/ watt to the total cost of a system.

A new analysis from Lawrence Berkeley National Lab finds that residential PV prices in Germany are much lower than in the US, mostly because of "soft" costs. 

German installers report average soft costs of $0.62/ watt for  2011, about $2.70/ watt lower than those in the US. 

In Germany, the labor required to install a system averages 7.5 hours ($0.55/ watt lower) and the time required for permits, interconnection and inspection takes 10 hours ($0.20/watt lower). Also, residential PV is exempt from sales tax in Germany. In the US, that adds $0.20/ watt.

"This race to the rooftops is designed to inspire innovative teams including installers, local governments, and utilities to make solar energy systems more affordable," says US Energy Secretary Steven Chu. "This aggressive target is an important step that will help bring us significantly closer to reaching the SunShot goal of cost-competitive solar energy by the end of the decade."

Phase I of the contest, which runs through 2015, requires the teams to deploy 5,000 small-scale rooftop PV systems ranging from 2-15 kW, demonstrating non-hardware costs that average $1/ watt. In Phase II, teams will be asked to deploy another 1,000 systems to prove the sustainability of their approaches.

The winner of the contest will receive $7 million, with $2 million and $1 million going to second and third place, respectively.

The SunShot Initiative was named for President John F. Kennedy's ambitious – but ultimately achievable -- "moon shot" program to put a man on the moon during the 1960.

The program aims to aggressively drive innovations in the ways that solar systems are conceived, designed, manufactured and installed.

For the contest registration information:

Website: www1.eere.energy.gov/solar/sunshot/prize.html



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