Multinational financial services corporation Morgan Stanley predicts massive growth for solar – and has also flagged the threat to power companies that energy storage poses.
The company projects combined solar growth for China, Japan, the US, Europe, India, and Brazil of 39 GW per year through to 2020, and global demand of 47 GW annually.
It also warns energy storage combined with solar power, could disrupt utilities in the US and Europe “to the extent customers move to an off-grid approach.” One of the major threats to power companies is Tesla, which is in the early stages of building its lithium-ion battery “Gigafactory”.
Through the Gigafactory, Tesla expects to achieve a minimum of 30% reduction in battery production cost and will achieve a battery production capacity able to supply the manufacture of 500,000 Tesla cars per year. This could have major flow-on effects for energy storage generally and not just in relation to Tesla owners if the company sets its sights on the solar market.
“We believe there is not sufficient appreciation of the magnitude of energy storage cost reduction that Tesla has already achieved, nor of the further cost reduction magnitude that Tesla might be able to achieve once the company has constructed its ‘Gigafactory,’ targeted for completion later in the decade,” says the report.
Morgan Stanley projects that if Tesla enters the solar market, the cost of storage will fall from Tesla’s current $250/kWh to $150/kWh by 2020 – with its closest competitor at a cost of ~$500/kWh
The company also believes that while large-scale solar projects will continue to be an important source of growth for the solar sector in the years ahead, the global trend will be one towards greater distributed generation in the form of commercial and home rooftop solar.
The 65-page report, ‘Solar Power & Energy Storage : Policy Factors vs. Improving Economics’ can be downloaded here (PDF).
