Environment: Interview

Which renewable energy should power your home?

Home owners can choose from an impressive selection of renewable energies. But which is the best for you? Klaus Schmuck of Allianz Climate Solutions discusses.
A power generating wind turbine is reflected in solar panels near Mainz, Germany/ Credits: Reuters
Klaus Schmuck, Head of Risk Management for Allianz Climate Solutions
Klaus Schmuck, Head of Risk Management for Allianz Climate Solutions Allianz Knowledge: More and more homes are being retrofitted with solar panels. Why is solar power growing so rapidly?
Klaus Schmuck: Prices have decreased because there are so many suppliers now. Chinese solar panel manufacturers have multiplied tenfold and many are already meeting European standards. 

Several years ago, potential buyers would have had to ask suppliers how many solar panels were available to buy. The manufacturers could pretty much set the prices. Now we have a surplus of solar panels. 

Who should invest in solar panels?
It’s a good investment for pretty much everyone in Germany—apart from people living in the northwest—because people here produce electricity not for their own consumption needs but for the grid. 

The government guarantees a fixed price for solar power that is much higher than what you pay for electricity from non-regenerative sources. Home owners in Germany aren’t interested in energy independence, but selling at a good price. 

Many European countries now have similar feed-in tariffs. In southern Europe and northern Africa it also makes sense to use solar for home consumption. And the U.S. is now starting to deploy solar panels on a large scale. California is already a global leader. 

We think that on a global scale grid parity could be achieved by 2015, especially in regions with high electricity prices and lots of sun. Solar power should then be able to hold its own without subsidies, even against electricity from natural gas or nuclear power

Should building owners invest now or will prices for solar panels fall further in two or three years?
In Germany, you should really have invested before the end of 2010. Electricity from solar panels built before 2011 can be sold at a guaranteed price that will remain stable for 20 years. After that, the guaranteed price will decrease every year. 

But there is an interesting paradox. Solar panels are usually more expensive in countries with a lot of sun, because profits would be much higher here otherwise. Even in Germany, solar panels are more expensive in the sunnier south than in the north.

What do you have to consider when installing and running solar panels?
It starts with the building itself; you have to make sure that the roof can really carry the panels. If you are building a new home, you can integrate the panels straight into the roof. If you are retrofitting an old building you have to mount a frame on the roof, which is actually not that bad, because the panels need good ventilation to work efficiently. 

Then you have to choose the right type of panel for your location. The light is more diffuse in a big city like Berlin, because of all the smog and haze. In the countryside, you get more direct and intense solar radiation. In general, there are two types of solar panels. Panels made of so-called thin-film solar cells are less efficient, but work better with diffuse light. The classical wafer-based silicon cells can produce more electricity but need direct solar radiation. 

Once your solar panels are up and running they don’t need much maintenance. Only bigger installations require an experienced controller. For installations on normal homes, a weekly performance check is enough to verify they are still running properly. 

How long does it take to pay off the initial investment?
That depends on how you have financed the panels. In Germany it usually takes 7 to 11 years. 

We know how long it takes until a wind turbine has produced the amount of energy needed to build it, usually only a few months. These figures are hard to get for solar panels, because manufacturers use different technologies for production. Researchers from the University of Utrecht found that, depending on the amount of sun you get, it takes two to four years until solar panels have produced more energy then it took to make them. 

And there is a certain degree of wear and tear on the panels. They have to deal with extreme temperatures, up to 60 degrees Celsius in summer and -20 degrees Celsius in winter. So performance decreases by 0.3 to 0.6 percent every year. Most manufacturers therefore guarantee at least 80 percent of performance for the first 20 years. 

What kind of alternatives are there to solar power?
There is a lot of work being done on small wind turbines in the UK right now, especially in urban areas. But there is one major problem: these small turbines are installed on roofs or masts that are just too low. 

That is why conventional wind turbines are mounted on a post that’s 100 meters tall. The wind up there is more stable. In an urban area, you get a lot of turbulence and the resulting wind speeds just don’t suffice. Furthermore, a turbine creates constant movement that can damage roofs. In the countryside, things look different. 

In the future, small combined heat and power plants will also be an interesting alternative. The industry will soon be able to deliver these with a competitive price tag. The question is how to power this unit.

If you use natural gas, you won’t do much to improve your carbon footprint. Wood pellets would be better, but then you depend on the wood price. Combining with a biogas plant would be the best solution. There is a pilot village in Germany, Jühnde, where this technology has been used for years. 

In many cases, a geothermal heat pump makes sense and can be combined quite effectively with solar panels. But you have to make sure that the location is suitable. If the difference in temperature between the soil and the surface is too small, the heat pump will become inefficient. 

Zero energy houses combine some of these technologies with first-class insulation. But are they affordable?
They are definitely interesting. In Germany, the KfW bank offers a loan program for such houses. But when you go for a zero-energy house, quality is crucial. If the building isn’t done right, heat and moisture will leak into the walls and you will have mildew.

Governments want to reduce energy consumption tremendously. What does this mean for old buildings?
In the U.S. this trend is already very obvious. There is the Green Building initiative that tries to verify that every new building is as energy-efficient as possible. I believe that in ten years time you won’t be able to find a buyer for a house that has not been built or retrofitted energy efficiently.


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