China: Solar Power For Less Than $0.025/kWh?

• A new US-China study has been released for technical potential of solar power and its cost-competitiveness in China
• It sees technical potential for solar energy in China reaching 146.1 PWh in 2060
• Solar and storage together can supply 7.2 PWh of grid compatible electricity in 2060 for less than $0.025 per kWh
• With continued decline in costs, especially for storage, solar energy can be used to power vehicles, heat or cool buildings, or to produce industrial chemicals

Come 2060 and China could be seeing solar energy, supported by storage, account for 43.2% share of its total electricity demand at less than $0.025 per kWh, claims a new joint study by US' Harvard University and Tsinghua, Nankai and Renmin universities from China.

According to the researchers, while the technical potential for solar power in China will grow from 99.2 petawatt hours (PWh) in 2020 to 146.1 PWh in 2060, combined solar and storage systems can supply 7.2 PWh (meeting 43.2% electricity demand) of grid compatible electricity in 2060. But China won't have to wait for that long for solar energy to achieve price parity to coal power as the team expects complete price parity nationwide by 2023. In 2021 alone, they see about 78.6% or 79.7 PWh of the Chinese technical potential achieving price parity.

Published in the Proceedings of the National Academy of Sciences (PNAS), the research work is based on an integrated model to assess the technical potential of solar energy in China and its cost between 2020 and 2060.

Study based on new integrated model

Calling recent projections about the cost of future solar energy potential based on outdated and overestimated costs of solar panels, their installation and storage technologies, the new model factors in land uses, possible tilt and spacing of solar panels, solar radiation to estimate the physical potential of solar power 'across both space and time'.

An hourly optimization model also added additional cost of storage systems, along with investment costs for solar and technological changes to estimate cost-competitiveness of solar power relative to coal power now and in the future.

Authors of the study argue that the estimated technical scenario of solar power by 2060 opens up further opportunities for decarbonization in the country. One of the co-authors of the report and Tsinghua Ph.D student and a Visiting Fellow at the Harvard-China Project, Shi Chen said, "Our research shows that if costs continue to decline, especially for storage, there could be opportunities to power vehicles, heat or cool buildings, or to produce industrial chemicals, all using solar energy."

According to Gilbert Butler, Professor of Environmental Studies at the Harvard John A. Paulson School of Engineering and Applied Sciences (SEAS) and co-corresponding author of the study, Michael B. McElroy, "The findings highlight a crucial energy transition point, not only for China but for other countries, at which combined solar power and storage systems become a cheaper alternative to coal-fired electricity and a more grid-compatible option."

The complete study titled Combined solar power and storage as cost-competitive and grid-compatible supply for China's future carbon-neutral electricity system is available for viewing on PNAS website.

The report comes at a time when China is dealing with frequent and long duration power cuts across the nation due to a coal power shortage and the necessity to meet its carbon reduction commitments, that has stalled its industrial activity, whose ripple effect is being felt by the world at large. The solar industry is not immune to these power outages as recently a number of leading solar module makers called upon the Chinese government to steer the domestic PV industry from current raw material supply challenges and power rationing (see Chinese Solar Companies Want Action).