The U.S. Department of Energy (DOE) in September released a study detailing the significant role solar power could play in decarbonizing the nation’s power grid, and reducing the country’s reliance on traditional fossil fuels. The report outlines an ambitious timeline for ramping up the production and utilization of solar power. It indicates that by 2035, solar energy has the potential to power 40% of the nation’s electricity—a significant jump from where we are today, with solar energy sources representing just 3% of the total electricity supply.
President Biden has made expansion of the country’s use of renewable energy a priority. This ambitious goal serves as an example of his administration’s decision to increase access to renewable power resources across the U.S.
Solar power has been growing for decades and represents one of the more established sources of renewable energy. However, making the jump from 3% to 40% of our nation’s energy supply will require massive upgrades to energy infrastructure, quick construction of new projects, major incentives for energy producers, and more. Here are five obstacles that stand in the way of meeting this aggressive timeline.
Required Energy Grid Upgrades
The current power grid across most of the U.S. is set up to accommodate natural gas and other traditional generation sources. Switching to a heavier reliance on solar power will require a modernization of the grid with new technologies that can accommodate solar. This will require more solar panels, transmission lines, storage facilities, and more, as discussed below. Specifically, the U.S. must install an average of 30 GW of solar capacity annually between now and 2025, and 60 GW per year between 2025 and 2030. For context, the U.S. installed 15 GW of solar power in 2020, a record high. The grid also will need to be expanded to a wider geographic range so that all areas can receive electricity from solar.
Lacking Battery Storage
Unlike natural gas, coal, and other energy sources that can be accumulated and stockpiled, the U.S. will need to devise more ways to store solar power for times when the sun is not shining. This will require the rapid construction of battery storage technology that can be used to store solar power until it is ready to be used. These batteries are expensive to make, and will require time for mass production. Right now, the country is facing a significant shortage of battery storage capacity, which will need to be addressed, especially if homes, businesses, and facilities across the country are going to rely on solar power.
Limited Transmission Lines
Once captured via solar panels, solar energy will need to be transported to the grid and then to homes, facilities, and businesses. This will require the creation of a much more robust, technologically advanced system of transmission lines. Similar to the state of battery storage, our capacity for transporting solar energy must be significantly expanded in a short amount of time in order to meet the goals set out by the Biden administration.
Ongoing Supply Chain Issues and Material Shortages
It’s no secret that supply chain issues have for months plagued manufacturers in a range of industries. As the U.S. moves to capture more solar power, demand for supplies like aluminum, silicon, steel, and glass, which are essential to the manufacturing of solar panels, will rise significantly, potentially exacerbating the existing shortages and high prices of these materials. This will apply additional pressure on solar panel manufacturers in the short term as they seek to double or even quadruple production of solar panels in the near future.
Chinese Trade Restrictions
The U.S. is currently facing a ban on imports of silicon, one of the most important materials in the construction of solar panels, from several major China-based producers due to forced labor violations. Earlier this summer, the Biden administration reiterated that it would not be removing this ban despite U.S. clean energy goals. While there are other sources of silicon, these trade restrictions will make it more difficult for solar panel producers to procure this critical material in the short term.
While there are many logistical, political, and manufacturing hurdles challenging Biden’s aggressive timeline to ramp up the use of solar energy, the Ways and Means Committee in the U.S. House has taken steps to accelerate clean energy development. The committee recently began marking up the $3.5 trillion budget reconciliation bill by including tax credits and incentives that support solar and clean energy producers.
Notably, the committee proposes extending the full value of production tax credits and investment tax credits by 10 years before their values begin phasing out. This would significantly reduce the cost of creating the infrastructure and technology needed to produce, transport, and utilize solar energy. It will also provide much needed clarity for developers and investors in solar energy as well as other clean energy sources.
Reaching Biden’s ambitious goal of solar energy representing 40% of the nation’s total energy usage by 2035 will be difficult, but not impossible. Biden has made his intentions clear for tackling climate change by increasing the country’s reliance on renewable energy sources.
—Edward Hild is a principal in the government relations practice of Buchanan Ingersoll Rooney.