5 challenges for solar energy industry and 5 solutions to them

12 Dec 2023
7 min
Beginner

Sergey FedorovAuthor

Solar energy has it all to replace fossil fuels and become our go-to choice: it’s cheap, it’s green and it can be used anywhere. What stands in its way? In this article, we’ll talk about problems for solar energy industry and the ways to overcome them.

Challenge #1: Bureaucracy and fossil fuels lobby

The vast majority of climate scientists agree that climate change is happening and humans are the reason for it. The burning of fossil fuels seems to be the main cause. It’s only logical that the world should switch to green energy and solar in particular to fight global warming. But still, quite a few politicians and some of the general public deny climate change which stalls the shift from fossil fuels to renewables.

97%

of actively publishing climate scientists agree that humans are causing global warming and climate change

The solar energy industry in particular still doesn’t get proper recognition from the state and society. The legal procedure for installing solar panels can be unnecessarily complicated — or there might not be a procedure at all. In the United States, HOAs in some states sometimes ban home solar system projects simply because they don’t understand the point of it.

Solution: We should popularize solar and make switching easier

The process of installing solar systems, approving them, and getting incentives for them should be simplified and streamlined. Installing solar should be recognized as a right of a citizen. Luckily, some American states are already working on the problem. Most states have adopted solar access laws that prohibit HOAs from banning solar installations. Still, as of 2023, 21 states still don’t have such a legislature.

We also need to popularize the idea of a green energy switch so that both citizens and politicians understand why it’s important and how it is going to help us combat climate change. For better or worse, life is the best teacher: recent hot seasons have convinced many people the problem is growing more and more serious.

The AP-NORC Center for Public Affairs Research conducted a poll in September 2023 across 1,146 Americans: 87% of respondents have experienced at least one extreme weather event in the past 5 years. The number grew from 79% who said that in April 2023. About three-quarters of those think that climate change is at least partly the cause.

Challenge #2: Outdated grids

Uneven solar production creates problems for grid operators

A particular challenge for the solar industry is old electrical infrastructure. Solar is a variable source of power which means that the production of solar panels changes with the time of day, weather and the season. Fluctuating loads that solar systems put on the grid aren’t something that the old electric grids were designed for. Some grids are only designed for a one-way energy flow — from a utility company to a consumer. Home solar systems require two-way current flow because solar owners want to sell their excess energy into the grid.

Solution: We should modernize grids to account for renewable energy

With how popular solar and wind systems get, we must invest resources in smart grids and tools that are capable of measuring and regulating the constant inflow and outflow of energy. For example, US Department of Energy set up a competition with a $600,000 prize pool for the best tool to forecast the net load. This project was aimed to help grid operators distribute their resources more efficiently.

Challenge #3: Low subsidies

Fossil fuel subsidies are one of the major obstacles to the world’s shift to renewable energy. They surged to a record $7 trillion in 2022, according to IMF 2023 report. These investments could be redirected into renewables to jump-start our transition.

Solution: We should triple investments in green energy

To achieve carbon neutrality by 2050, we should triple the investments in green energy, UN experts believe. This means at least $4 trillion a year should go to renewable energy until 2030. This will include investments in technology and infrastructure. This is not nearly as much as fossil fuels tend to consume annually in the form of subsidies, tax breaks, and health and environmental damages that aren’t taken into account.

Challenge #4: Solar panel recycling

One of the most pressing issues that subsidies should help to solve is recycling old panels. Solar panels are mostly glass, a bit of plastic and some aluminum. Recycling companies are unenthusiastic about taking on old panels: you only get around $3 per cullet from one panel, according to MIT.

The problem is only going to grow: about 8 million metric tons of decommissioned panels could accumulate globally by 2030. By 2050, that number might reach 80 million which would be comparable to the weight of 800 million blue whales!

Only about 10% of solar panels in the US are recycled

Solution: We can make manufacturers recycle old panels

With enough financial support, we could make manufacturers control the recycling process. In the EU, similar rules already apply: manufacturers must maintain the equipment as well as recycle it. In the US, only the state of Washington DC has such a requirement and it will only take effect in 2025.

Challenge #5: Access to raw materials

China produces around 80% of crystalline silicon and about half of the global supply of solar panels and their components. The countries around the globe depend on Asia in order to develop their own solar industries. Meanwhile, in 2023 China considered imposing restrictions on the materials used to produce silicon wafers - key components of solar panels, according to WSJ. When a major supplier makes a move like that, it has a major impact on the development of the solar industry all across the globe.

Solutions: Everyone should get access to raw materials

To ensure the steady development of green energy, we should find ways to consistently supply manufacturers with materials for solar panels, wind turbines, power grids, electric vehicles and energy storage. For this, we must improve our supply chains and cooperation between countries. It’s not easy, but if we want to succeed, we must learn to work together.

The future of green energy is still looking bright

Global renewable capacity additions are set to soar by 107 gigawatts,
the largest absolute increase ever, to more than 440GW in 2023, according to IEA report. Solar PV capacity stands for two-thirds of the year’s projected increase in global renewable capacity and will continue to do well in 2024.

This is indeed a positive forecast. But in order to maintain the growth rate, we still need to learn how to optimize renewable energy projects and stimulate investment from both the public and private sectors. We need strong policies, government support and international cooperation inspired by a common idea of a green switch. If — or should I say when — we overcome the challenges, then a bright future of cheap energy without carbon emissions can become a reality.

Sergey Fedorov

Co-founder & CTO

Sergey has been running A1SolarStore since 2017 with the main idea in mind – making going solar easier for everyone. Based on a thorough market research and his personal experience, he shares his ideas on both solar industry and management related topics.