The federal government will pump $40 million into solar research and development in a bid to cut the cost of solar energy to roughly a third of today’s costs.

The Australian Renewable Energy Agency (ARENA) funding round will help Australia keep its status as a global leader in solar research and development and build on ARENA’s “solar 30 30 30 target”: achieve 30 per cent PV module efficiency and 30 cents per installed watt at utility scale by 2030. 

Solar and wind are already outcompeting fossil fuels as Australia’s cheapest forms of energy, according to June 2021 CSIRO research. That’s even when the high transmission costs associated with renewables are taken into account. 

“Ultra low cost solar will be a vital component in helping Australia move towards a lower cost, largely renewable electricity system and achieve the goal of net zero emissions by 2050,” ARENA CEO Darren Miller said.

The solar R&D funding will flow to two different cohorts: innovations in high performance solar cells and modules, where Australian R&D already excels, and innovations across solar systems, operations and maintenance. The latter seeks to “broaden the approach to accelerate innovation that can drive down the upfront and ongoing costs of utility scale solar PV in the field,” according to ARENA.

The funding will be split evenly between the two streams.

Some of Australia’s most successful research in solar has emerged from the University of NSW, including the PERC (Passivated Emitter and Rear Cel) silicon solar cell, which was invented by UNSW researchers 30 years ago and is now the foundation of more than 80 per cent of the world’s solar panels, according to ARENA CEO Darren Miller.

More recently, a startup founded by former UNSW students called SunDrive beat the world record for the most efficient solar cell. The cell uses copper instead of silver and achieves an efficiency of 25.54 per cent. Copper is about 100 times cheaper than silver.

Achieving “ultra low cost solar” – solar energy that costs $15 per megawatt hour to generate – was flagged as a goal in the federal government’s Low Emissions Technology Statement released last year. 

Driving down the costs of renewables even further is expected to help bring down the cost of green hydrogen and the underpin the decarbonisation of industrial outputs such as steel and aluminium.

Last week, the federal government also committed $150 million towards a “clean hydrogen trade program” to establish supply chains for clean hydrogen and clean hydrogen derivatives, such as ammonia, starting with Japan.

Photo: SunDrive’s high performance solar PV invention.