As the world makes a shift towards renewable energy sources to mitigate climate change, floating photovoltaic systems are seeing a rapid expansion as part of the solar energy industry.
Despite the global FPV market growing at a rapid pace and these systems expected to play a major role in future energy systems, an understanding of its role is still in a nascent stage. The thing is that FPV technology faces its own unique technical and engineering constraints, and it’s important to gain an understanding of how much FPV may be reasonably developed when considering the “technical potential.”
To determine the same, a paper has been published by geospatial scientists in the National Renewable Energy Laboratory (NREL), a primary national laboratory of the US Department of Energy for renewable energy efficiency research and development.
The results of the study show the very high generation capacity of these floating photovoltaics on reservoirs, which is estimated to be in the range of 861 to 1,042 GW direct current (GWdc). This much energy can power approximately 100 million US homes a year, potentially representing about half of the future solar generation needs of the US for a decarbonized grid.
Floating Photovoltaic’s Technical Potential on Reservoirs
Published in Solar Energy, the new study evaluated, for the very first time, just how much energy floating solar panel projects installed on regulated or federally owned reservoirs could generate.
A reservoir is an artificial lake that stores water and plays a critical role in meeting water needs in populated areas. Most of these reservoirs are formed by constructing dams across rivers in order to control the amount of water that flows out of them.
Reservoirs have been built by people for thousands of years in order to address the problem of the invariable amount of water in a river. During rainy times, the water level in a river increases and may overflow, which is controlled by reservoirs. During droughts, water levels run very low, and reservoirs help provide the required supply for irrigation and other household and business needs.
A common problem with reservoirs is evaporation, which is extremely dire in dry areas. While in wet areas, evaporated water often falls again as rain, in hot areas, it can result in a huge loss of water. Research is ongoing for ways to control evaporation.
Besides meeting the water needs in populated areas, the other purpose reservoirs serve is generating electricity. Dams are created to generate power by using the elevation difference. Another way to achieve that is with floating solar panels.
These floating solar panels on reservoirs have been found by the latest study to have a large “technical” potential of up to 1,476 terawatt hours (TWh), which is the maximum amount of energy that could be generated if each reservoir had as many of these panels as possible.
While we can’t really develop this much energy, if even 10% of the identified can be developed, that, according to Evan Rosenlieb, a geospatial scientist at NREL, “would go a long way.”
This study isn’t the first attempt at quantifying just how much energy can be generated from floating solar panels, as at least ten other studies have done so in other regions or globally in the last six years. However, this one stands out for being the first study to consider which specific water bodies actually have the suitable conditions to support such power plants.
For instance, some reservoirs are impacted by shipping traffic, which causes wakes in them. Those wakes can damage the mooring lines or impact the floating infrastructure. In other reservoirs, the problems arise in terms of them being too cold, too shallow, or too steep to secure solar panels in place.
While these kinds of reservoirs do not support floating solar panels, there are other kinds that can be ideal for them.
For such locations, a hybrid energy system is the perfect choice because it relies on both hydropower and solar energy. This way, such a system can provide more reliable and resilient energy to the power grid.
When used in addition to hydropower resources, FPVs can really bring immense benefits. For instance, if the reservoir of a hydropower facility is reduced by a drought, solar panels can help produce energy while the water replenishes. FPVs, in particular, when co-located with hydropower resources, can provide potential reductions in water evaporation.
However, despite the many benefits of floating solar panels or floating PV, there really haven’t been “any large-scale installations” of them at places like a large reservoir. Aaron Levine, a senior legal and regulatory analyst at NREL, noted how, in the US:
“We don’t have a single project over 10 megawatts.”
So, by providing more accurate data on FPV’s potential in the US, the study can help developers plan projects on US reservoirs far more easily and assist researchers in examining just how these technologies fit into the broader energy goals of the country.
The study has yet to consider how floating solar energy development on specific reservoirs will be impacted by human and wildlife activities, which is planned to be addressed in future work.
Another area of focus for researchers will be evaluating more potential locations, including smaller reservoirs, estuaries, and ocean sites. They will also be reviewing the locations closest to transmission lines, development costs at specific sites, whether a site should be avoided to protect the local environment, and how developers can navigate both state and federal regulations.
Floating Photovoltaic Systems Meeting Solar Energy Demands
Solar photovoltaic energy is a well-established renewable energy source that utilizes solar radiation to produce electricity.
There are three elements required to achieve this: photovoltaic modules to convert photons of light into electrical energy, an inverter to convert that direct current and alternating current into electricity for consumption, and transformers to raise the voltage in order to reduce electrical losses.
You will usually find the installation of photovoltaics mainly on grounds or in buildings, but these locations neglect other important resources such as the sea, reservoirs, and marshes. Thus came floating photovoltaics, which use the water surface to install floating PV panels.
Now, when it comes to key components of this variant of solar PV energy, they use panels similar to what you would find and use on the ground in order to capture sunlight and then convert it into energy.
To keep these panels afloat on the water surface, floating platforms are made from high-density and durable materials. These floating panels also have to be kept from drifting away due to wind or water currents, for which an anchoring system is used to secure the platform. The mooring system ensures the positioning and stability of solar arrays.
Additionally, FPVs have inverters for the crucial conversion of DC into AC to facilitate usage in electrical systems. Waterproof cabling, meanwhile, ensures safe and efficient energy transfer.
For the past few years, floating solar photovoltaic systems have been gaining a lot of traction due to their higher efficiency and energy yield compared to land-based solar photovoltaic systems.
The installed capability of floating solar PV has seen an average annualized growth of 142% between 2014 and 2022. 2014 was the year when the global installed capacity exceeded 10 megawatts of direct current (MWdc), and 2022 was the year when cumulative capacity surpassed 13,000 MWdc. This floating solar power is expected to grow even further due to the vast amount of reservoirs available in the world.
This growth of FPVs is driven by a number of factors. For starters, they save water by protecting it from high evaporation and prevent strong gusts of wind from eroding the shores. By reducing eutrophication, they also protect against excessive algae growth.
One of the great benefits of these systems is that they provide increased energy production due to the cooling effect they get from the water they are floating on. The water lowers the operating temperatures of solar cells, thus improving power conversion efficiency.
Data has actually shown FPV farms to be consistently outperforming conventional ground-mounted solar projects, allowing for more power generation. One study found that FPV systems increase power output by 2 to 3.9%. Another one reported energy gains to be 15% to 25%, which offers a much better return on investment.
Floating solar panels are simply an innovation that allows for land to be used for more important needs of the people, especially in areas where land availability is restrictive or cost-prohibitive.
Besides allowing for energy generation without sacrificing valuable land resources, FPVs can also be less demanding in terms of installation cost by removing the need to first acquire land and then prepare the site.
All these benefits, however, do not mean that it’s all good with this tech, as the capital cost will still be high here due to the requirement of cables, anchors, and floating platforms, which not only adds to the cost but also brings complexity. There is also uncertainty as to how all these different elements, including panels, will perform in salt water.
The tech is not yet fully developed either. The current models also have limited tilt, which can negatively affect production. Then, there is the need for more data, especially on its longevity. Besides performance degradation over time, data needs to be collected about how maintenance can impact their operational life.
Despite the many challenges of FPV, its benefits contribute to combating climate change and achieving greenhouse gas neutrality. Hence, there is growing interest in the biggest operational FPV installations found in Asia. The largest floating solar photovoltaic system in China is the Dezhou Dingzhuang Floating Solar Farm, which has a capacity of 320MW. It is located in a Shandong Province reservoir and is owned by the electric company Huaneng Power International (HPI). The farm generates approximately 550 million kWh annually.
In Europe, just a few months ago, Germany launched its largest floating photovoltaic power system. It is located on an artificial lake and includes over 27,000 solar panels with a total capacity of 15 megawatts. The project is expected to generate about 16 million kWh of electricity annually.
Leading Investable Solar Company
With the global economy making a rapid shift in energy sources, away from carbon-based fossil fuels to cleaner alternative energy sources, renewable energy has the attention of not just governments and scientists but also companies.
Against the backdrop of wind, solar, and hydroelectric power supplying over 20% of the electricity generated by the US power sector, many companies are specifically buying power produced from renewable sources while others are investing directly in renewable energy development projects.
Among these green energy companies, some of the biggest names include NextEra Energy (NEE -0.85%), which plans to expand its solar energy and storage capacity significantly and eliminate carbon emissions from its operations by 2045. First Solar (FSLR +1.04%) meanwhile develops and manufactures thin-film solar panels to generate more energy. Then, there’s Brookfield Renewable (BEP -1.29%), which sells much of its power under long-term power purchase agreements (PPAs).
Click here for a list of top solar stocks to invest in.
Now, let’s take a deeper dive into a leading green-energy firm:
1. Constellation Energy (CEG +0.36%)
Constellation Energy is a carbon-free energy producer whose solar, wind, hydro, and nuclear facilities have the generating capacity to power the equivalent of 16 million homes. The company produces about 10% of the carbon-free energy in the US.
As of writing, CEG shares are trading at $315.97, up 41.42% YTD. In addition to the company share prices on the rise, it also pays a dividend yield of 0.45%, which certainly makes it an attractive option. Its EPS (TTM) is 9.06, and P/E (TTM) is 34.92.
Constellation Energy Corporation (CEG +0.36%)
For the last reported financials, which was Q3 2024, the company’s GAAP net income came in at $3.82 per share, up from $2.26 in the same quarter the previous year, while adjusted (non-GAAP) operating earnings were $2.74 per share. For fiscal 2024, analysts are expecting Constellation Energy to report an adjusted EPS of $8.43, a massive 68.3% increase from fiscal 2023.
The company’s nuclear fleet produced 45,510 GWhs in this quarter, during which its renewable energy capture was 96%.
Constellation Energy also announced the signing of a 20-year power purchase agreement with Microsoft for the Crane Clean Energy Center. The tech giant will purchase the output generated from the plant, which was retired in 2019, to power its data centers with clean energy. Constellation Energy also expects its facility to qualify for the technology-neutral clean electricity PTC provided by the IRA during its first 10 years of operations.
The company attributed artificial intelligence as the reason behind its success, with CEO Joe Dominguez saying:
“The importance of AI and the data economy to America’s economic competitiveness and national security can’t be overstated,” and noted that its “customers are looking for clean, emissions-free energy that they can rely on in every hour of every day.”
The fast-growing demand for electricity from AI-driven data centers is expected to continue to drive its stock momentum, which is also supported by Constellation Energy’s $16.4 billion acquisition of Calpine Corporation. With this purchase, the company has added natural gas and geothermal resources to its portfolio.
Through its fleet of 78 gas plants and other energy facilities across the US, Calpine generates enough electricity to power about 27 million homes. The agreement with Constellation Energy comes amidst the historic rise in the nation’s power demand, with the consulting firm ICF expecting the power consumption of the US to grow by almost 20% by 2033.
Conclusion
The demand for energy is rising across the globe, and to meet some of this demand, countries and companies alike are turning to renewable energy sources like biomass, wind energy, hydroelectric power, and solar power. There is actually a constant increase in the usage of renewable sources in the energy sector, particularly in the production of electricity.
Among all renewable energy resources, solar energy has seen the highest growth in recent years thanks to being a clean energy source. The most widespread solar technology is solar photovoltaics (PV), accounting for 3.6% of global electricity production. However, typical solar PVs only have low efficiency due to several factors, including cell temperature, which requires cooling strategies. Here, floating solar PV offers natural cooling phenomena that lead to improved energy yield.
These benefits of enhanced energy efficiency, land preservation, and optimal coverage make floating photovoltaic systems promising technology to generate substantial renewable solar energy globally. While FPV has its challenges, the latest study’s results show that the country’s reservoirs have huge potential for future development. Moreover, offering insight into reservoir suitability based on site-specific factors for FPV development can help projects tailor to each location and bring more efficiency to them — paving the way for sustainable integration of FPV into global renewable energy strategies!
Click here for a list of top renewable energy stocks.
