Can solar fit into the energy mix?

New Zealand is still a minnow when it comes to solar power, especially compared to Germany. Photo / Mark Mitchell

When measuring installed solar power per person, New Zealand lags well behind the rest of the world, despite having pretty good sunshine hours. Compared to the undisputed world heavyweights of solar, the Germans – at 440 watts per capita – we’re mere minnows, at just 1.9 watts installed per person.

But that’s about to change. Dropping panel prices, rising power bills and rapidly improving technology is coming together to produce an industry that has grown 330 per cent in the last two years, and is still increasing. Welcome to the solar age.

Put too much solar-generated power into the grid and it can cause harmonics, differences in voltage that can affect the equipment.

Put too much solar-generated power into the grid and it could affect the value of the companies that generate and deliver electricity.

Just look at Germany, where a heavily subsidised build-out of domestic solar capacity is now seen as a misuse of resources in a country that doesn't get that much sun.

At best, in July 2013 at the height of summer, it produced 5.1 terawatt hours. In January it produced 0.35 TWh, and nothing at all at the time of peak demand - 6pm on a cold winter's evening.

The summer surges of renewable power into the system caused financial headaches for utilities already struggling with the shutting down of nuclear power plants and the lower European coal prices as a consequence of America's switch to shale gas.

The share price of the country's largest utility, E.ON, has dropped by three quarters, and its income from conventional power generation has fallen by a third since 2010.

Australia is also finding out the effects of installing 3000MW of solar capacity in five years - that's almost a third of New Zealand's total generating capacity.

The GREEN Grid project at the University of Canterbury's Electrical Power Engineering Centre (EPEC) is an attempt to investigate the impact of photovoltaic (PV) solar power generation on low and medium voltage distribution networks.

Canterbury University's Allen Miller hopes to smooth the way for solar PV adoption. Photo / Supplied

EPEC director Allan Miller says one of the goals is to provide guidelines for the adoption of solar PV in New Zealand and modelling tools and techniques, so distribution companies can better understand the impact of what's coming, like it or not.

Under their most optimistic scenario, between two and three per cent of New Zealand's power could come from solar PV.

This will increase the variability of electricity supply as the sun shines or is shaded by clouds.

Miller and colleagues from Canterbury's department of Electrical and Computer Engineering and Otago University's marketing department surveyed distribution companies covering about 80 per cent of the population to put some hard numbers on photovoltaic solar power uptake in New Zealand.

According to a paper presented to the EEA conference this month, installed capacity per capita at the end of 2013 was 1.9 watts. The year before it was 0.6 watts and in 2010 it was just 0.1 watts. (For GREEN Grid's data on the number of solar panel sites in New Zealand, see the below graph.)

Compare that with Germany, with has installed capacity of 440 watts per inhabitant. Australia has 139, and the United States 38, mainly concentrated in the southwest.

Miller says New Zealand is coming late to the solar PV revolution with no subsidies and no official support.

The numbers around domestic solar PV stack up depending on the amount people are paying for their existing power service and the sort of rate they can get for selling surplus power back to a generator.

But it's not really helping the overall national generating picture, and means others have to pick up the fixed costs in the transmission system.

That's not stopping people.

"We're in the early adopter phase. It's people who are interested in technology or being more sustainable in their energy use or they want independence from the grid so they have valid reasons to put up systems," Miller says.

"We have got to the point where it is marginal, it is starting to provide a net present value, over a long time period, and also depending where you live and the circumstances of your house, shading, orientation and so on."

That's why the Tasman district and Marlborough, with long sunshine hours and the price effect of being at the end of a long transmission line, are leading the charge for solar PV adoption with 9.2 watts and 7.1 watts per capita respectively.

Lowest was Wellington with just 0.7 watts, and Auckland was on 1.5 watts.

There is a case for solar in sites that are off the grid, and some lines companies are encouraging customers at the remote ends of their networks to shift to solar or wind capacity.

Where solar is growing quickly is for medium and large firms where the array on the roof can offset other power sources.

Miller's paper looked at several growth scenarios, and concluded it was hard to pick a figure.

"If you extrapolate from current growth rates, 43 per cent of houses would have solar PV by 2018. That's unrealistic, especially given the lack of subsidised feed-in tariffs, and 13 per cent by 2017 could be a better guess, giving a total capacity of 116 watts per inhabitant and ultimate uptake of about 750MW."

The evolution of battery storage, allowing some solar to be captured and trickled into the system through the evening, should also help encourage domestic uptake.

So as far as the forecasters go, they don't even have a dartboard to throw at yet.