Roy does it again. This time he gives a succinct overview of PV (Solar Photovoltaic Products). If you don't know what it is you probably need to read the article...you'll be a lot smarter for the effort.

RENEWABLE ENERGY FUND WEEKLY UPDATE #71

Solar (Photovoltaic) Energy 101

by Roy D.  Wasson

Fund Manager

          Greetings to our readers who support the goals of the Renewable Energy Fund:

          —Energy Independence: Reducing and eventually eliminating America’s dependence on energy supplied by unfriendly, oil-exporting nations;

        —Cleaner Environment: Reducing air pollution/greenhouse gases and reversing global warming thru efficiency, reduced consumption and alternative fuels;

          —Affordable Energy: Supporting efficient green technologies to bring down cost of vehicle fuels, home and business lighting and heating/air conditioning;

        —Restructured Agricultural Economy: Encouraging farmers to grow new energy crops, instead of paying them not to grow, while increasing food availability;

          —Profitable, Socially-Responsible Investing: Making money the clean and green way!

        This week’s Update focuses on the basics of generating electricity from solar energy.  The Renewable Energy Fund is invested in a number of solar energy companies engaged in the production and sale of photovoltaic (“PV”) products.  As Fund Manager, I have joined industry organizations to learn more about solar energy, including the American Solar Energy Society and the Florida Solar Energy Industries Association.  The following is a discussion about PV science, systems and products published by the Florida Solar Energy Center, a research organization created by the Florida Legislature.  This report contains a brief history of photovoltaic power, describes how

        A.  Introduction:

        Although solar electricity producing devices have been around for over 50 years, solar electricity devices, often referred to as photovoltaics or PV, are still considered cutting edge technology. The promise of clean, cheap, and abundant electricity from the sun has been the dream of many scientists and businesses. As a result each year a number of discoveries and advances for this technology have been made.

        PV, or solar cells as they are often called, are semiconductor devices that convert sunlight into direct current (DC) electricity. Groups of PV cells are electrically configured into modules and arrays, which can be used to charge batteries, operate motors, and to power any number of electrical loads. With the appropriate power conversion equipment, PV systems can produce alternating current (AC) compatible with any conventional appliances, and can operate in parallel with, and interconnected to, the utility grid.

        B.  History of Photovoltaic Power:

        The first conventional photovoltaic cells were produced in the late 1950s, and throughout the 1960s were principally used to provide electrical power for earth-orbiting satellites. In the 1970s, improvements in manufacturing, performance and quality of PV modules helped to reduce costs and opened up a number of opportunities for powering remote terrestrial applications, including battery charging for navigational aids, signals, telecommunications equipment and other critical, low-power needs.In the 1980s, photovoltaics became a popular power source for consumer electronic devices, including calculators, watches, radios, lanterns and other small battery-charging applications.

        Following the energy crises of the 1970s, significant efforts also began to develop PV power systems for residential and commercial uses, both for stand-alone, remote power as well as for utility-connected applications. During the same period, international applications for PV systems to power rural health clinics, refrigeration, water pumping, telecommunications, and off-grid households increased dramatically, and remain a major portion of the present world market for PV products. Today, the industry’s production of PV modules is growing at approximately 25 percent annually, and major programs in the U.S., Japan and Europe are rapidly accelerating the implementation of PV systems on buildings and interconnection to utility networks.

        C.  How Photovoltaic Cells Work:

        A typical silicon PV cell is composed of a thin wafer consisting of an ultra-thin layer of phosphorus-doped (N-type) silicon on top of a thicker layer of boron-doped (P-type) silicon. An electrical field is created near the top surface of the cell where these two materials are in contact, called the P-N junction. When sunlight strikes the surface of a PV cell, this electrical field provides momentum and direction to light-stimulated electrons, resulting in a flow of current when the solar cell is connected to an electrical load.

        Regardless of size, a typical silicon PV cell produces about 0.5 – 0.6 volt DC under open-circuit, no-load conditions. The current (and power) output of a PV cell depends on its efficiency and size (surface area), and is proportional the intensity of sunlight striking the surface of the cell. For example, under peak sunlight conditions, a typical commercial PV cell with a surface area of 160 cm^2 (~25 in^2) will produce about 2 watts peak power. If the sunlight intensity were 40 percent of peak, this cell would produce about 0.8 watts.

        D.  Cells, Modules and Arrays:

        PV cells are connected electrically in series or parallel circuits to produce higher voltages, currents and power levels. PV modules consist of PV cell circuits sealed in an environmentally protective laminate, and are the building blocks of PV systems. PV panels include PV modules assembled as a pre-wired, field-installable unit. A PV array is the complete power-generating unit, consisting of any number of PV modules and panels.

        E.  How A PV System Works:

        Simply put, PV systems are like any other electrical power generating systems, just the equipment used is different than that used for conventional electromechanical generating systems. However, the principles of operation and interfacing with other electrical systems remain the same, and are guided by a well-established body of electrical codes and standards.

        The performance of PV modules and arrays are generally rated according to their maximum DC power output (watts) under Standard Test Conditions. Standard Test Conditions are defined by a module (cell) operating temperature of 25o C (77o F), and incident solar irradiance level of 1000 W/m2 and under Air Mass 1.5 spectral distribution. Since these conditions are not always typical of how PV modules and arrays operate in the field, actual performance is usually 85 to 90 percent of the STC rating.

        Today’s photovoltaic modules are extremely safe and reliable products, with minimal failure rates and projected service lifetimes of 20 to 30 years. Most major manufacturers offer warranties of 20 or more years for maintaining a high percentage of initial rated power output. When selecting PV modules, look for the product listing (UL), qualification testing and warranty information in the module manufacturer’s specifications.

        Although a PV array produces power when exposed to sunlight, a number of other components are required to properly conduct, control, convert, distribute, and store the energy produced by the array. Depending on the functional and operational requirements of the system, the specific components required may include major components such as a DC-AC power inverter, battery bank, system and battery controller, auxiliary energy sources and sometimes the specified electrical load (appliances). In addition, an assortment of balance of system (BOS) hardware, including wiring, overcurrent, surge protection and disconnect devices, and other power processing equipment.

        Batteries are often used in PV systems for the purpose of storing energy produced by the PV array during the day, and to supply it to electrical loads as needed (during the night and periods of cloudy weather). Other reasons batteries are used in PV systems are to operate the PV array near its maximum power point, to power electrical loads at stable voltages, and to supply surge currents to electrical loads and inverters. In most cases, a battery charge controller is used in these systems to protect the battery from overcharge and overdischarge.

        F.  Types of Photovoltaic Systems:

        Photovoltaic power systems are generally classified according to their functional and operational requirements, their component configurations, and how the equipment is connected to other power sources and electrical loads. The two principal classifications are grid-connected or utility-interactive systems and stand-alone systems. Photovoltaic systems can be designed to provide DC and/or AC power service, can operate interconnected with or independent of the utility grid, and can be connected with other energy sources and energy storage systems.

        Grid-connected or utility-interactive PV systems are designed to operate in parallel with and interconnected with the electric utility grid. The primary component in grid-connected PV systems is the inverter, or power conditioning unit (PCU). The PCU converts the DC power produced by the PV array into AC power consistent with the voltage and power quality requirements of the utility grid, and automatically stops supplying power to the grid when the utility grid is not energized. A bi-directional interface is made between the PV system AC output circuits and the electric utility network, typically at an on-site distribution panel or service entrance. This allows the AC power produced by the PV system to either supply on-site electrical loads, or to back-feed the grid when the PV system output is greater than the on-site load demand. At night and during other periods when the electrical loads are greater than the PV system output, the balance of power required by the loads is received from the electric utility This safety feature is required in all grid-connected PV systems, and ensures that the PV system will not continue to operate and feed back into the utility grid when the grid is down for service or repair.

        G.  How Photovoltaic Cells Are Made:

        The process of fabricating conventional single- and polycrystalline silicon PV cells begins with very pure semiconductor-grade polysilicon, a material processed from quartz and used extensively throughout the electronics industry. The polysilicon is then heated to melting temperature, and trace amounts of boron are added to the melt to create a P-type semiconductor material. Next, an ingot, or block of silicon is formed, commonly using one of two methods: 1) by growing a pure crystalline silicon ingot from a seed crystal drawn from the molten polysilicon or 2) by casting the molten polysilicon in a block, creating a polycrystalline silicon material. Individual wafers are then sliced from the ingots using wire saws and then subjected to a surface etching process. After the wafers are cleaned, they are placed in a phosphorus diffusion furnace, creating a thin N-type semiconductor layer around the entire outer surface of the cell. Next, an anti-reflective coating is applied to the top surface of the cell, and electrical contacts are imprinted on the top (negative) surface of the cell. An aluminized conductive material is deposited on the back (positive) surface of each cell, restoring the P-type properties of the back surface by displacing the diffused phosphorus layer. Each cell is then electrically tested, sorted based on current output, and electrically connected to other cells to form cell circuits for assembly in PV modules.

        Thin-film photovoltaic modules are manufactured by depositing ultra-thin layers of semiconductor material on a glass or thin stainless-steel substrate in a vacuum chamber. A laser-scribing process is used to separate and weld the electrical connections between individual cells in a module. Thin-film photovoltaic materials offer great promise for reducing the materials requirements and manufacturing costs of PV modules and systems.

        H.  Pros and Cons of Photovoltaic Systems:

        Photovoltaic systems have a number of merits and unique advantages over conventional power-generating technologies. PV systems can be designed for a variety of applications and operational requirements, and can be used for either centralized or distributed power generation. PV systems have no moving parts, are modular, easily expandable and even transportable in some cases. Energy independence and environmental compatibility are two attractive features of PV systems. The fuel (sunlight) is free, and no noise or pollution is created from operating PV systems. In general, PV systems that are well designed and properly installed require minimal maintenance and have long service lifetimes.
        At present, the high cost of PV modules and equipment (as compared to conventional energy sources) is the primary limiting factor for the technology. Consequently, the economic value of PV systems is realized over many years. In some cases, the surface area requirements for PV arrays may be a limiting factor. Due to the diffuse nature of sunlight and the existing sunlight to electrical energy conversion efficiencies of photovoltaic devices, surface area requirements for PV array installations are on the order of 8 to 12 m^2 (86 to 129 ft^2) per kilowatt of installed peak array capacity.

        I.  Solar Energy Tax Credits and Rebates:

        The Energy Policy Act of 2005 (EPAct 2005) provides substantial incentives for consumers to take advantage of purchasing photovoltaic systems. The act offers tax credits to consumers who purchase photovoltaic systems for both residential and commercial use.

        A tax credit offers significantly more financial savings to the buyer than a tax deduction. A tax deduction is subtracted from the income before tax liability is computed. The tax credit is subtracted directly from the total tax liability. This means that a tax credit offers more savings to the consumer than the tax deduction. For a comparison, a tax credit of $1,000 for a taxpayer in the 28% tax bracket is the equivalent of a tax deduction of $3,751.

        For residential systems, the allowable tax credit is 30% up to a maximum tax credit limitation of $2,000. In addition to the benefits for residential homeowners, the EPAct increases the benefits of the business investment tax credit. The provisions of the bill increase the business investment tax credit from 10% to 30%. The business investment tax credit for solar systems does not have a maximum credit limit. To be qualified for the tax credit offered in the EPAct, the consumer must purchase the system in the calendar year 2006 or 2007, and the photovoltaic system must be certified by FSEC per FL Statute 377.705.

        The 2006 Florida Renewable Energy Technologies and Energy Efficiency Act, signed into law on June 19, 2006, provides consumers with rebates and tax credits for photovoltaic systems.

        The purchase of photovoltaic systems covered under the Florida Renewable Energy Technologies and Energy Efficiency Act qualifies the consumer to receive a substantial rebate. The rebate is based on the manufacturer’s power output rating of the modules. The amount is $4.00 per Watt with a cap of $20,000 for residential photovoltaic systems and a $100,000 cap for commercial, publicly owned, or private not-for-profit photovoltaic systems.

Roy D. Wasson

Fund Manager

Renewable Energy Fund

and

Board Certified Appellate Attorney

Wasson & Associates, Chartered