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Creating Dramatic Change while Supporting Local Jobs/Economies and America’s Dominance in Solar Energy Jigar Shah President and CEO SunEdison
[object Object],[object Object],[object Object],[object Object]
Scenarios ,[object Object],[object Object],[object Object],Evaluation of Accelerated Change Scenarios
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Challenge Scenario ,[object Object],[object Object],[object Object],Political Will for Structural Resolution Set up Scenario:
Challenge Scenario ,[object Object],[object Object],[object Object],Political Will for Local/Rural  Economic Development Set up Scenario:
How Different? ,[object Object],[object Object],[object Object],Why does this accelerate change?   Wild Card:  Political Will
Distributed Generation Focus ,[object Object],[object Object],Renewable Energy
Why Solar Photovoltaics? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],-High First Costs -Large Intermittency Issues -NIMBY -Trans.&Dist. Capacity -Resource Locations ,[object Object],[object Object],[object Object],[object Object],Weaknesses -Proven, although not standardized -Ag development -Usually limited to using a waste stream  -Reasonable Economics in certain cases -Proven Technology  -Cost Competitive -Proven Technology -Siting -Higher Electricity Value (Retail) -Local Construction/O&M Jobs -Peak Power, utility friendly b/c impossible to produce at night Strengths BioMass Large Wind Solar PV
Why worry about Natural Gas? ,[object Object],[object Object],[object Object]
Why worry about Natural Gas? Electricity Share of Total Natural Gas Usage Natural Gas Prices  1995-2015 Source: GRI Baseline Center - 2000 Edition of the GRI Baseline Projection Source: US Department of Energy – Energy Information Administration, International Energy Outlook ,  Annual Energy Outlook 2002
Why worry about Natural Gas? Natural Gas Prices have risen sharply in last 6 months
New Mandates Renewables ,[object Object],[object Object],[object Object],[object Object]
[object Object],[object Object],[object Object],[object Object]
Solar ,[object Object],[object Object],[object Object],[object Object],Why Solar?
Theory of the Possible ,[object Object]
Accelerating Change Natural Gas US Generating Capacity Source: EIA Solar PV US Generating Capacity Source: BP Solar analysis
Accelerating Change Solar PV US Generating Capacity Source: BP Solar analysis Natural Gas US Generating Capacity Source: BP Solar analysis Natural Gas Plant Consumption goes down as price effects from Natural Gas usage kicks in Solar is integrated within Fortune 500, Gov’t Buildings – federal, state, municipal
Cost Effective Markets Germany and Japan are already installing at 2007 prices due to learning curve leadership on labor and electronics costs 2005 2008 2012 2020
Cost Effective Markets There are over 50,000 GWhs being sold at prices in excess of 15 cents per kWh – a price at which solar will be able to compete cost effectively without subsidies in the next five years.
Near-term Solar Potential
Cost Challenge ,[object Object],[object Object],[object Object],[object Object],[object Object],Biggest Challenge – Cost and Political Will
Solar PV Pathway to 2015 Goal * All advances have already been discovered to achieve above benefits, implementation and optimization through scale is required  Cents per Retail kWh Total ownership cost Balance of System (BOS) Reliability 2015 goal O&M Solar Panels Balance of System/ Installation Labor Avg. Retail Electricity Price Cell Efficiency 14% to 17% Mfg. Yield 85%  95% Mfg. Scale (MWs) 30  200 Silicon Material    20% Installation Efficiency Scale/Speed Solar System Cost Reduction Impacts O&M Solar Panels BOS/ Install BOS/ Install
Solar Subsidy Justification Reduced deaths from particulate pollution and asthma related heath care costs Health Care –  secondary using current cap & trade values Reliability, Loss Savings, Substation, Transmission, Peak Load Availability Electric Grid Reliability Benefits –  secondary using current cap & trade values NO x , SO x , Mercury, and CO 2 Emissions –  secondary using current cap & trade values Includes mfg, engineering, design, installation, and overhead jobs. Employment/Fees –  income tax, sales tax, local fees Sources of Benefits from Solar Power Installations
Japanese Solar Program Historical Solar Subsidy and Benefits 10 year program – Breakeven 2003/4 (Billions Yen)
Proposed US Program  Net Subsidy Required for Adoption in US 10 year program – Breakeven in 2014 (Billions $)
Public Will ,[object Object],[object Object],[object Object],What will it take to drive down these costs?
Advantaged Cost ,[object Object],[object Object],[object Object],[object Object],We can get to parity in electricity costs…
[object Object],[object Object],[object Object],[object Object]
How large is the Industry Today? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Existing US Industry
Alternative Paths to a Solar Future Existing Buildings Solar Mfg. ,[object Object],[object Object],[object Object],Marketing Installation System New Construction ,[object Object],$0.15 cents/kWh Note: Federal and some state mandates are largely in place for public buildings, execution needed Solar Mfg. ,[object Object],[object Object],[object Object],Regulation Installation System ,[object Object],[object Object],[object Object],$0.12 cents/kWh
Existing Buildings ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Existing Stock
New Construction ,[object Object],[object Object],[object Object],[object Object],[object Object],New Stock
How do we sell it? ,[object Object],[object Object],[object Object],[object Object],Implications for Channel
What about other Renewables? ,[object Object],[object Object],[object Object],[object Object],[object Object],Implications for Renewables Broadly
Leveling Electricity Load Typical Electricity Load Profile Hours GW Peak loads, reduce load factor and are expensive to build around, peak PV power could shave the most expensive 2 % of peak demand in less than 10 years – reducing electricity costs by over 5% US Profile
Electric Power Business ,[object Object],[object Object],[object Object],[object Object],Implications for Power Business
Solar Suppliers ,[object Object],[object Object],Summary
Review ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Scenario Review:
Risks ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Biggest Risks to Scenario:
[object Object],[object Object],[object Object],[object Object]
Likelihood of Political Will ,[object Object],[object Object],[object Object],Drivers of Political Will  Add to this: Opportunities for Political and Economic Upside
Upside ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Opportunities for Upside  If you were a US Political Leader Trying to Inspire your Electorate…
Subsidy & Spending Examples ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],The  $10 Billion  incentive this requires over  10 years  is small relative to the  size  of other programs Source: Public Citizen
Barriers ,[object Object],Stated Solar PV enthusiasm ,[object Object],[object Object],Private sector does not drive to action Biggest Barrier to Political Will
Requirements ,[object Object],[object Object],[object Object],[object Object],What would it take?
Putting it into Perspective

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Driving Dramatic Change in Solar Energy Through Cost Reductions and Political Will

  • 1. Creating Dramatic Change while Supporting Local Jobs/Economies and America’s Dominance in Solar Energy Jigar Shah President and CEO SunEdison
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  • 11. Why worry about Natural Gas? Electricity Share of Total Natural Gas Usage Natural Gas Prices 1995-2015 Source: GRI Baseline Center - 2000 Edition of the GRI Baseline Projection Source: US Department of Energy – Energy Information Administration, International Energy Outlook , Annual Energy Outlook 2002
  • 12. Why worry about Natural Gas? Natural Gas Prices have risen sharply in last 6 months
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  • 17. Accelerating Change Natural Gas US Generating Capacity Source: EIA Solar PV US Generating Capacity Source: BP Solar analysis
  • 18. Accelerating Change Solar PV US Generating Capacity Source: BP Solar analysis Natural Gas US Generating Capacity Source: BP Solar analysis Natural Gas Plant Consumption goes down as price effects from Natural Gas usage kicks in Solar is integrated within Fortune 500, Gov’t Buildings – federal, state, municipal
  • 19. Cost Effective Markets Germany and Japan are already installing at 2007 prices due to learning curve leadership on labor and electronics costs 2005 2008 2012 2020
  • 20. Cost Effective Markets There are over 50,000 GWhs being sold at prices in excess of 15 cents per kWh – a price at which solar will be able to compete cost effectively without subsidies in the next five years.
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  • 23. Solar PV Pathway to 2015 Goal * All advances have already been discovered to achieve above benefits, implementation and optimization through scale is required Cents per Retail kWh Total ownership cost Balance of System (BOS) Reliability 2015 goal O&M Solar Panels Balance of System/ Installation Labor Avg. Retail Electricity Price Cell Efficiency 14% to 17% Mfg. Yield 85%  95% Mfg. Scale (MWs) 30  200 Silicon Material  20% Installation Efficiency Scale/Speed Solar System Cost Reduction Impacts O&M Solar Panels BOS/ Install BOS/ Install
  • 24. Solar Subsidy Justification Reduced deaths from particulate pollution and asthma related heath care costs Health Care – secondary using current cap & trade values Reliability, Loss Savings, Substation, Transmission, Peak Load Availability Electric Grid Reliability Benefits – secondary using current cap & trade values NO x , SO x , Mercury, and CO 2 Emissions – secondary using current cap & trade values Includes mfg, engineering, design, installation, and overhead jobs. Employment/Fees – income tax, sales tax, local fees Sources of Benefits from Solar Power Installations
  • 25. Japanese Solar Program Historical Solar Subsidy and Benefits 10 year program – Breakeven 2003/4 (Billions Yen)
  • 26. Proposed US Program Net Subsidy Required for Adoption in US 10 year program – Breakeven in 2014 (Billions $)
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  • 36. Leveling Electricity Load Typical Electricity Load Profile Hours GW Peak loads, reduce load factor and are expensive to build around, peak PV power could shave the most expensive 2 % of peak demand in less than 10 years – reducing electricity costs by over 5% US Profile
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  • 47. Putting it into Perspective