BP Solar to Increase Photovoltaic Production

BP Solar to Increase Photovoltaic Production

"The cost reduction trend is taking solar towards parity with conventional power - indeed the cost of installed systems has dropped six-fold in 20 years. Generally however, we're still looking for a halving or more of installed cost to enable solar to have mass market potential."

- John Mogford, Group Vice President of Renewables and Alternatives for BP

Merseburg, Germany - September 17, 2004 [SolarAccess.com] Large solar photovoltaic (PV) projects in Germany may do more than supply power to the grid, they may help to bring down the price of cell manufacturing. BP Solar opened has opened "Geiseltalsee", a 4 MW solar PV array in Saxony Anhalt this week. It is one in a series of company developments that could expand the PV market. Over the next 18 months the company also plans to try and lower costs of the solar market through the economic strategy of increasing production.

Margareta Wolf, who is the Parliamentary secretary of state in the Federal Ministry for the Environment, attended the opening event of Geiseltalsee and said that the large solar installations built recently in Germany are a solid beginning to the market strategy.

"We need this development towards mass production so as to ensure that photovoltaic becomes cheaper and reaches the threshold to market maturity faster," she said.

Eventually, BP plans to add another two MW onto the Geiseltalsee site, but the company's contribution to production wouldn't stop there. BP Vice President for Renewable Energy Steve Westwell said the company is going to increase its global production capacities from the current 90 MW annual out put to 200 MW by the early part of 2006.

Details of the increase aren't available yet, but John Mogford, who is the Group Vice President of Renewables and Alternatives for BP, talked about the need to bring down the cost of PV through an increase in production during his speech at the World Renewable Energy Congress in Colorado a week ago.

"The main driver of our growth will be on-grid in developed countries," he said. "The foundations of tomorrow's solar industry have to be laid in the developed world. It is here, if anywhere, that the sector will gain the scale needed to become profitableý if solar is to play a significant part in the lower carbon economy, it cannot be a cottage industry. Neither can it be a licence to lose money in a good cause. The industry has to think big, make money and become hundreds of times larger than it is today. "

PV production did grow 32 percent from 2002 to 2003 and a total of US $5 billion in sales, according to Mogford. He put those numbers in perspective, however, and compared last year's growth of around 600MW in solar capacity as equal to output of one natural gas fired turbine or less than half a typical coal fired plant.

"The cost reduction trend is taking solar towards parity with conventional power - indeed the cost of installed systems has dropped six-fold in 20 years. Generally however, we're still looking for a halving or more of installed cost to enable solar to have mass market potential," he said.

Government support through incentives and policy could help the industry, but that support is only part of the equation. Mogford talked about scaled up production with a $100 million plant in Spain, increasing the flexibility of the Frederick, Maryland plant, and launching new production lines in India, Australia and the US. The state of California as a source of sales is also big on the BP horizon, as is business in the market of building integrated photovoltaics (BIPV).

"Obviously we want to create a thriving business. But that can only happen if we operate in a thriving market. And we cannot create that alone," he said. "All of this works towards a point of inflexion - a breakthrough moment, the 'tipping point' - where solar achieves parity with other energy sources."

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