The Potential for Cost Reduction

Hugo de Moor

Results from the EU-Photex project 2002-2003

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

Price ProjectionsConstant learning rate

0

1

2

3

4

5

6

2000 2010 2020 2030 2040 2050

Year

€/WpA LR = 0.3 GR = 20%

B LR = 0.2 GR = 20%

C LR = 0.1 GR = 20%

D LR = 0.2 GR = 10%

E Epia scenario

Price of PV Systems

The Future of the past

JPL Silicon Module Cost Studies 1978-1985(Source: JPL, 1986)

0.0

5.0

10.0

15.0

20.0

25.0

Status 1978 (1978)

Target 1986 (1978)

SoA projection Cz 1988 (1985)

Projection Dendr. web 1992

(1985)

Mod

ule

Cos

t (Eu

r-20

00/W

p)

moduleencaps. mat.cellwafersilicon

22.9

1.52.21.6

Projections were too optimistic

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

Price distribution of residential PV systems BRD

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1 kWp 5 kWp 2 kWp, 2002

Euro

/kW

p

modules

inverter

mounting structure,installation material

installation labour

planning,documentation

Total

Module cost dominant

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

What is the potential formodule cost reduction?

There is room for cost reduction- lower materials cost

• absorber (amount, purity)• encapsulant

- higher efficiency- taking advantage of economy-of-scale

It is difficult to determine the annual cost reduction

on the basis of R&D potential

Cost Break Down PV modules

Materials ≈ 50%

Cell EfficiencyYield

Labour

Cost Break Down x-Si (90% of market)

Silicon wafer

Cell Efficiency

Module materials

Labour

(Note: Direct manufacturing cost do not include overhead such as R&D, Sales, Maintenance and Staff Departments)

Analysis of cost reduction x-Si

Wafer costFeedstock 30% Scrap from IC Indusry

20 - 30 €/kg FluctuatingIndependent supply needed=> 15 - 20 €/kg Si (mg Si 2 $/kg)

Silicon content 2000 17 g/Wp2010 10 g/Wp

sheets (EFG, RGS), wafer thicknessCrystallisation cast, sheetsWafering

Analysis of cost reduction x-Si

Cell ProcessingLabour, Equipment

Efficiency, (yield, uptime)

Plant size

Efficiency 12-14% → 15-18%2000 2010

Plant Size 1990 1 - 5 MWp 50 MWpa2000 10 - 25 MWp 300 MWpa2010 25 - 100 MWp 2 GWpa

Effect of Plant Size on Price

0

1

2

3

4

5

2,5 25 250

MWp/Year

ECU'96/Wp

MarginModule ManufacturingCell ManufacturingSlicingGrowing

Source, Alonso et al., 1995(Music-FM study)

Analysis of cost reduction x-Si

Analysis of cost reduction x-Si

Module AssemblyMaterials, Labour

YieldCapital12%

Labour7%

Overhead10%

Tabs6%

Glass10%

EVA20%

Tedlar17%

Frame18%

Maycock 2000

Scale-upLaminatesNew encapsulantsBack contact cells

Analysis of sources of cost reduction

Price ForecastsMaycock 20012000 3-4 $/Wp2005 3.3 $/Wp2010 2.3 $/Wp

Epia2000 3.5 € /Wp2005 2.7 € /Wp2010 2.1 € /Wp

Price development in Japan

Ogawa (NEDO) 12th PVSEC

Modules ($/Wp)2000 4.62005 1.72010 1.2

120 ¥ = 1$

Cost Break Down a-Si

Cell Efficiency

Materials

Module materials

Labour

Yield

Analysis of cost reduction a-Si

DevelopmentsEfficiency >> 5 - 8% → 8 - 14%

2000 2010

Higher throughput CVD

Low-cost TCO

Double glass → Single glass → plastic foils

Process control (uniformity, yield)

Analysis of sources of cost reduction

Price ForecastsMaycock 20012000 2-3 $/Wp ?2005 2 $/Wp2010 1.2 $/Wp

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

Cost potential of inverters

• Inverter is only 10-15% of system costImportant for system performance and reliability

New concepts

Less components

Economy-of-scale

Standardisation

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

Cost potential of inverters

System performance and reliability

• Mismatch loss parallel (AC-module, PV Wirefree, Bus)

• Ease of installation• Duplication

Range of inverters 200 - 500 - 2000 W - 5000 W needed

- Do it yourself vs profesional installers

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

Inverter development

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

Some conclusions on cost potential• Module prices make up 70%-80% of systems

Focus for cost reduction effortsBOS: reliable, energy output

• Material costs most important part of module costsSolar Si feedstock productionLess materialLess pure material

• Higher efficiency• Economy-of-Scale

R&D and sustainable market

Hugo de Moor Photex FinalMeeting Brussels 25 November 2003

What will be our products ?

• Coming 20 years improving current technologyx-Si and thin-films (Film-Si, CIS)

• After 2020 new concepts are needed

• BIPV• Small power plants (grid quality)• SHS’s• Long term bulk-power > 2030