Opinion –
Larry Sherwood is one of the nations leading experts on the solar thermal market in the US.
He is the author of the US Solar Market Trends report for the Interstate Renewable Energy Council. I sat down with Larry this week to ask him what the 2010 market would look like for solar thermal.
Was 2009 reflection of expectations based on 2008?
It’s not like it’s totally doom and gloom out there. We have incentive programs… and, probably on a percentage basis even more in solar thermal in 2010. So, I think that the 2010 picture is going to be quite a bit different than the 2009 picture.
What incentives are most effective?
Stimulus money — some of those are probably direct system in that the federal government is buying, like the military bases in that kind of thing. Some of it is stimulus money that is going to states that they are buying systems directly for state or from and buildings. A lot of it has flowed into state incentives; and, that money, a lot of it — hasn’t really flowed to real systems yet. So, the impact is going to be so much more in 2010 than it was in 2009.
Do you think that the market is just getting people to think more creatively?
Yes, and the lesson from the PV side. As the market has grown it has grown much faster in the nonresidential sector than the residential sector. And solar thermal market has traditionally been much more concentrated in the residential sector than the PV market has been. And what I have been noticing, is that there are more players actively pursuing the nonresidential market. And my guess is, is that solar thermal is going to grow dramatically year after year, for a number of years, a big part of how that’s going to happen, is starting to see much more installations outside of the residential sector.
Why?
The tax offerings are good. I think that the bigger systems allow some of economies of scale. There are some, more sophisticated installer integrator type players that are looking at that market — and I guess that in some markets PC isn’t going to make as much sense, and the solar thermal is going to make a lot more sense.
What about space heating?
There is a little, but not very much. And even if you look at the data from programs that offer incentives, in northern climates, which is where you would expect to see it — like Wisconsin and Oregon – there is not very much. Space heating, you are going to see in cold weather places because they have really long heating seasons. So they can use the solar for a long part of the year. A climate that has a really short heating season is going to be really hard to justify.
And, you probably need something other than people heating with natural gas. It’s probably really difficult to make the economics work against natural gas.
What about solar cooling?
I would say, cooling is potentially more promising. I put it in the category of new technologies that are worth watching. But, I’ll believe it when I see it.
If the technology works, and it’s reasonable economically, they can compete against electricity. So, it has the potential to be a better value for the customer, and in hot weather places, where you’re using cooling for a long season, then it makes sense as heating. It’s not going to make sense for climate that doesn’t need cooling very much of the year.
Anywhere south of Washington DC — clearly the deep South, Florida Texas — would have potential. But I don’t know how close we are to realizing that potential.
Do you see much solar space heating or cooling in Europe?
Solar heating certainly. I am not sure about solar cooling. I’m not sure if there’s any place where there is a big market for that. And the companies there need to come over and prove that they can make the market work here.
Are we going to see more activity from an energy bill in concress?
I think that the money [already] is in the pipeline. I think that the thing that would cause 2010 to go bad, if something went really bad in the economy overall. Future years may depend on an energy bill, but 2010 is more dependent on money that is already in the pipeline. The energy bill probably has nothing to do with 2010.
Are you aware that Senator Fiengold is put in a measure to increase the ITC credit to 50% on solar thermal instead of the current 30%?
My guess is that that would be a heavy lift; but it’s a worthy goal.
byline: Seth Warren Rose
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[...] February issue of Solar Thermal Business Magazine features a conversation about solar hot water with IREC’s Larry Sherwood. Larry, an expert [...]