Historically, the PV industry has been chasing a 'Laboratory miracle' - a major breakthrough in module efficiency and methods of production to reduce costs and so reduce system prices. The Taormina diffusion model effectively plotted a course for the market development of photovoltaics based on generation cost reductions brought about by such efficiency improvements and gradual production volume increases. But developments within the power supply sector are opening the door to the more widespread application of photovoltaics based on the value that consumers attach to their power requirements.

Whilst attention to cost reduction remains high, utilities are beginning to recognize other intrinsic values of PV systems. For instance, they can be quickly installed, plant availability is generally excellent, and PV is a valuable means of demonstrating environmentally friendly credentials to an increasingly 'green' public.

But as Allen Barnett, President of US PV manufacturer Astropower, made plain to the Sun Valley participants, the key to near term utility applications is the recognition of capacity value, and in particular the potential for load matching - i.e. using PV systems output to satisfy utility load patterns. Customer sited photovoltaics, for instance in office buildings, are gaining recognition as a means of reducing building peak loads where the period of major load coincides with the periods of most insolation. PV power profiles are particularly well suited to reducing building cooling loads, for instance. Customer sited and grid-support PV also offer substantial reductions in local transmission and distribution (T&D) losses, all of which means less expenditure on the upkeep of old or construction of new central generating plant.

There have of course been significant reductions in the price of grid-support PV plants in recent years - 50% in the USA since the first conference on PV systems for Electric Utility Applications in Taormina. This has been brought about by cost reductions on all fronts - less costly modules, cheaper balance of systems components such as trackers and inverters, and reductions on project management expense. The utilities have played a significant role in this process with multi-utility competitive bidding helping to accelerate system developments and price reductions.

This is obviously heartening to the PV industry, which has seen over USD 4 billion ploughed into research, development and demonstration of photovoltaic technology to date. The industry is intent on further cooperation with utilities to share both potential risks and probable rewards. The success of any future cooperative ventures will rely upon a mutual appreciation of the respective areas of expertise of the involved parties. The industry itself has considerable experience of designing systems and has been largely responsible for the market growth to date. Utilities are more than just a source of capital. They can contribute much in the way of engineering know-how or marketing and business planning expertise.

Utilities can make a difference. Those that already have an interest in PV are exerting a sizeable scaling up to meet increasing demands and are focusing on productivity and manufacturing technology improvements to further reduce system process and improve prospects for sustained profitability.

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