This appendix summarizes an analysis performed by NREL under my direction and supervision to evaluate the potential of distributed photovoltaics (PV) to offset the future electricity generation and capacity needs in the area currently supplied by the Indian Point Nuclear Power Plant near New York City. This analysis provides an overview of PV markets, an analysis of the potential for PV to help replace the electricity capacity and generation from the Indian Point nuclear power station in New York State, a summary of New York’s current policies related to PV technology, and an accelerated PV deployment scenario for New York through 2020.
Some important observations include:
The technical potential for rooftop PV in New York is very large—on the order of 35-40 GW statewide and 18-20 GW in the Hudson Valley, NYC, and Long Island control areas. Reaching this potential will require time to scale up the market infrastructure and production capacity for PV.
Given that PV is a distributed generation technology it competes against retail, not wholesale, electricity rates.
Given that PV is a distributed generation technology and that its production profile is highly coincident with peak demand it can contribute significantly to grid stability, reliability, and security. Thus, from a planning perspective PV should be valued at a rate higher than the average retail rate.
The cost of PV-generated electricity is expected to decline considerably over the next decade, falling from a current cost of 20-40 cents/kWh to a projected cost of 10-20 cents/kWh by 2015.
Given that Indian Point is a ~2 GW base load plant, operating roughly 95 percent of the time, it would be very difficult for PV alone to replace all of the generation from Indian Point during the next 5-10 years.
By pursuing a strategy that would combine PV with other technologies, such as efficiency, wind, hydro, and storage, PV should be able to replace 15-20 percent of the generation of Indian Point and 80-90 percent of the capacity of Indian Point during peak periods by 2020.
Under an aggressive but plausible accelerated PV deployment scenario, roughly 50 MW of PV systems could be installed in New York by 2009 (generating roughly 80 GWh of electricity), and 470 MW of PV systems could be installed in New York by 2014 (generating 700 GWh of electricity) (see Table D-7-1). This level of PV installations in 2014 could offset about 30 percent of Indian Point’s capacity during peak periods and about 4 percent of Indian Point’s annual electricity output. In addition, under the accelerated scenario about 1 GW of PV systems could be installed in New York by 2016, generating 1,500 GWh of electricity (offsetting about 40-50 percent of Indian Point’s capacity during peak periods and 9 percent of Indian Point’s annual electricity output). Realizing this accelerated scenario would require making a clear long-term commitment, in terms of both policies and resources, to expanding New York’s existing PV programs. Perhaps more importantly such an initiative would establish a self-sustaining PV market in New York, resulting in an additional 1 GW of PV being installed in New York by 2020, generating 3,000 GWh of electricity (offsetting about 80-90 percent of Indian Point’s capacity during peak periods and 18 percent of Indian Point’s annual electricity output) without any public subsidies between 2016 and 2020.
Key PV Markets
During the past decade the global PV market has been experiencing explosive growth. For example, during the past 5 years (1999-2004), the average annual growth rate of the global PV industry has been 42 percent. As shown in Figure D-7-1, the fastest growing PV market segments during this period were the grid-connected residential and grid-connected commercial segments. Such rapid growth has created tremendous excitement about PV technology around the world on the part of governments (EC, 2004), industry (SEIA, 2004; NEDO, 2004; EPIA, 2004), and the investment community (CLSA, 2004). As shown in Figure D-7-1, during 2004 the global PV industry passed the 1 GW mark in annual installations. At this point in time the global PV industry is truly beginning to move into large-scale production.
The rapid growth in the global PV market during the past decade, shown in Figure D-7-1, was driven largely by government subsidy programs, in particular in Japan, Germany, and a few states within the United States (including Califor-nia and New York). Over the coming decades, as costs con-
TABLE D-7-1 Estimated Distributed Photovoltaics in the Indian Point Service Area in the Accelerated Deployment Scenario
Installed PV capacity (MW)
Generation offset by PV(GWh)
SOURCE: Derived from NYSERDA (2003).
Dan Arvizu is a member of the Committee on Alternatives to Indian Point for Meeting Energy Needs and the director and chief executive of the National Renewable Energy Laboratory.