(introduction...)
Despite its recent progress and its substantial potential, solar
technology is not fully commercial, except for small-scale, "off grid"
applications, and costs are still higher than those of supplying peak and
off-peak power for grid supplies using fossil fuels. Nor is it certain that it
will become commercial for large-scale applications, or (given the widespread
subsidies for grid-supplied electricity in many countries) that it will be as
widely used for small-scale applications as would be economically desirable.
What can be said is that technical progress and reductions in
costs have been impressive and that analyses of the possibilities for further
progress - in the technologies themselves, and in their manufacture, and of the
potential for economies of scale in manufacture - show that the prospects for
solar power are very promising, given good economic and environmental policies.
Were it not for concerns about global warming, further progress
could be achieved through pursuing moderate increases in R&D funding,
removing deformities in energy prices, and otherwise relying on markets to
develop autonomously. According to projections by the U.S. Department of Energy,
this would probably be sufficient to see more commercial applications emerge
gradually over the next two to three decades. Yet given that the global
environment is a public concern - as evidenced by the fact that 160 countries
have now signed the Climate Change Convention (90 have ratified it, of which 60
are developing countries) - the case is compelling for more active policies to
hasten the commercialization of solar energy. In high-insolation areas, solar
energy is currently emerging as the most promising option for stabilizing carbon
emissions and accumulations, should the need arise (see Box 1).
Whether it is necessary to go further - that is, to embark on a
program for stabilizing carbon accumulations, or even to move toward a program
for reducing the accumulations - must await the results of more definitive
research on long-term climate change. What can be concluded at present is that
support for the development and use of solar technologies is a necessary part of
any precautionary policy for addressing global warming. This is why the GEF
financed several renewable energy projects in its pilot phase and why it is to
give priority to such projects in future operations. As it happens, prospects
are good that such initiatives may also contain the seeds of a pleasant economic
surprise.
Box 1. Carbon Emissions and Solar Scenarios
The top figure shows two scenarios of carbon emissions summarized
in the World Development Report 1992. The fossil fuels scenario (dotted line
shows) the expected growth of emissions with continuing use of fossil fuels
(assuming continued progress in energy production and end-use efficiency).
Emissions grow in this scenario because of the growth of energy demands in
developing countries, where per capita consumption is only 5 percent of that in
the rich countries, and more than 2 billion people are still without access to
commercial fuels. The renewable scenario (solid line) makes the same assumptions
about energy efficiency but also assumes a gradual substitution of solar energy
forms for fossil fuels. The use of renewables would enable stabilization of
emissions and accumulations over the long term.
The bottom figure shows the shift in shares of primary energy
demand required to stabilize CO2 emissions. Although solar energy
will be a small share of the market for some years, substitution of solar energy
for fossil fuels, along with economic efficiency in energy production and use,
are at present the most promising long-term options for stabilizing carbon
emissions and accumulations.
Carbon Emissions, Reliance on Fossil
Fuels Versus
Shift Toward Renewables.
1990-2050
