By: Ernst van den Berg www.anglodutchservices.co.uk

The fall in cost is due to the increased lifetime, the institute says

The cost of installing and owning renewable systems will fall according to new research.

Now with the Copenhagen treaty being held we look at the politicians and what they have come out with. We know there have been other summits like Kyoto with only a few European countries taking the renewable energy market serious. Now they are the leaders!

This time the outcome looks to be different. President Obama visited in Copenhagen himself and not just on the last day to make himself look good. The Chinese know that there is a big economic gain for them too. We all know that the world needs an economic stimulus and this is the one. Yes, the Americans are on board now. Even Exxon is advertising their ecological views.

Climate change is happening there is no doubt about that. The only question was: Are we to blame or is this a natural occurrence, or both? And the argument doesn’t really matter. Climate change is political now. The public can either pay high energy bills for decades, bonuses for the fat-cats, or we invest in our own homes and businesses doing everything possible to not need that much energy and have a return on that investment.

The UK needs 200 billion to replace the old power stations, nuclear and other. We all pay a levy in our bills already to pay toward this. The people who are least energy efficient pay the most-and the energy prices will only go up. One incentive might be that we get a reduced tariff for heat pumps for example. Also, when we need less energy, the big companies can invest less. As mentioned, it’s political now and fat-cats don’t like spending their own money.

Tests show that 90% of existing solar pv panels last for 30 years, instead of the predicted 20 years, experts have told the BBC. According to the independent EU Energy Institute, this brings down the lifetime cost and creates an even greater payback on the investment.

Good quality and efficient panels are such a good long-term investment that banks should offer mortgages on them like they do on homes the institute says. Commercial lease options are already available with some manufacturers. A business can advertise to be green all they want but what would an array of solar panels on top of your business tell your customers?

Many people in the industry forecast that solar panels will be cost-competitive with energy from the grid for half the homes in Europe by 2020.

Incentive programmes in Italy, Germany and Spain have created manufacturing volumes that’s bringing down cost. Solar pv panel prices dropped 30% last year alone due to an increase in output and a drop in orders because of the recession.

PV-Panels had been expected to last for 20 years and price calculations were based on this. (with a free energy source, purchase and installation represent almost the entire price of solar power)

Long lifetime

It has shown that more than 90% of the panels on the market 10 years ago are capable of still performing well after 30 years of life, albeit with a slight drop in performance.

We all know that 40-year photovoltaic panels will be on the market soon. Hot water collector panels are already expected to last 35 years with little loss of efficiency producing 70% of hot water needs. And quality heat pumps are known to have a life span of 30 years plus too outliving boilers 4 to 6 times, using only 25% of the energy, the rest is solar.

A key goal for solar pv panels is what is known as grid parity. That is the point when it is as cheap for someone to generate power on their homes as it is to buy it from the grid. And here again, if you only need a little you don’t need to generate as much. Especially those people that are building new now please get well informed for the long term. Retro fit is always more expensive. 12 volt LED lighting is now available too for the domestic and commercial markets.

It varies per country and electricity prices, but the EU energy institute estimates that Italy - which has a combination of sunny weather and relatively high electricity prices - should reach grid parity next year. Half of Europe should be enjoying grid parity by 2020, it estimates.

Cloudy northern countries like the UK could wait further, maybe up to 2030. But the day would come when solar panels on homes would be cost-competitive without a subsidy, even in Britain. This is what governments aim for and the way to do this is to allow energy prices to go up by big margins.

All technologies in the industry are bound to grow much further and the financial returns on the investments will be growing as the energy prices keep going up. We all have heard in the autumn of 2009 Ofgem making the announcement that we shouldn’t be surprised if energy prices rise of 60% by 2016. And this is what they do tell us.

“We have been surprised in the past five years at the drop in solar panel prices. It’s due to good incentive programmes first in Germany then Spain and Italy. That created a kind of a boom that was helping industry to reduce costs and get into profitability. And when an industry is in profit it drives on its own.

Owning solar photovoltaic

Professor Wim Sinke, from Utrecht University in the Netherlands, who leads the solar umbrella group the European Photovoltaic Technology Platform, says the industry has even greater ambitions.

“The target of the sector as a whole is to reach grid parity in almost all of Europe over the next 10 years. So by 2020 we should have grid parity in most of Europe,” he told the BBC News.

Key sticking points for domestic solar, he said, would be the lack of flexibility in electricity grids to take in surplus generated energy and difficulties with finance.

Dr Ossenbrink said: “What I would like to see is the finance sector saying that solar power is a product like financing a house - they can even predict the value of the solar panel much more safely than they can predict the value of the house over decades.

Electricity will never be given away free. Banks should offer mortgages on people’s solar panels like they do on homes - the bank should own the installation, it would transfer to the home owner when the loan has been paid off. It would be perfect for life assurances.

It will take quite a bit longer for solar to match fossil fuel power at the point of generation, the institute says, because wholesale electricity prices are much lower than retail prices.