You can’t ignore Swanson’s Law

My good friend Tom Raftery has just published a provocative piece here on Medium called “What do we do in a world where energy is in abundance?

Raftery’s article is based on an analysis of the impact of Swanson’s Law, which notes that the price of solar photovoltaic modules tends to drop 20 percent for every doubling of cumulative shipped volume, and that at present rates, costs halve about every 10 years.

The photovoltaic cells that make up solar panels have increased their efficiency over four successive technological generations, falling from $76.76 per watt in 1977 to $0.36 per watt in 2014. This has produced a virtuous cycle whereby the falling price is driving the growth of installed capacity, which is increasing demand, and which is driving prices down. In other words, the price of solar energy will continue to fall. And this is going to mean some big changes.

For many years now we have been seeing ever greater economies of scale in energy production: to be efficient, generation processes need to be grouped to create critical mass, a process that almost invariably leads to very large projects such as power plants fired by coal, gas, hydroelectric, or nuclear energy. But technology now means that we can rethink the economy of scale approach. As things stand, alternative energy distribution is more efficient, and decentralization is increasingly the logical way forward, particularly in areas with a lot of sunshine.

Many countries are now rethinking their energy policies, and moving toward greater use of sustainable or renewable sources of electricity. In a country like Spain, where I live, there is absolutely no excuse for not carpeting every single roof in the country with solar panels. Governments can choose to ignore technological development, but in a country like Spain, which has some of the most ideal conditions and reasons for using solar energy, continuing to pursue policies that punish households and businesses that want to produce their own electricity our government is simply lining the pockets of private electricity utilities with taxpayers’ money. The time has come to explain to our politicians Swanson’s Law.


(En español. aquí)

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