Integrating Photovoltaic Technologies in Alberta´s Electric Industry: An Analytical Approach

By Vikram Dhaliwal, Dema Dumsky, Henry Chen, Neil Chakrabarty and Dr. Peter J. Catania
October 2003

Mr. Daliwal, Dunsky, Chen and Chakrabarty are undergraduate students in the Faculty of Engineering, University of Calgary, Canada. They are the decision makers of tomorrow. They make us think today.
Dr. Catania is the Chairman of International Energy Foundation (IEF) in Okotoks, Alberta, Canada.

Photovoltaics are compatible with the long-term targets of a sustainable energy market in Alberta, Canada as well as being an integral player in an eco-restructuring transition in Alberta´s growing deregulated electric utility economy. The main barrier to the widespread use of photovoltaic (PV) systems is the current high capital costs. However, PV systems have the qualities of simplicity and reliability hence their annual operating and maintenance costs are low. With the continued historical reduction in capital costs from $50 per peak watt in 1976 to $5 in 1994 (approximately 10% per year), it is predicted that by 2014 costs could be reduced to $0.5 per peak watt. This reduction will be due in part to the double-digit global growth rates in demand for energy. As a result of PV flexibility in terms of technological options, PV is consistent with all sustainable energy patterns open to innovation, and technological changes. In an uncertain pricing environment such as todays, it may become necessary for the government to underwrite a renewable energy project by assuring electric utility operators that they will receive a certain price for generated electrical power over a pre-specified period of time, irrespective of the world market conditions. This policy has been used successfully in the past with other commodities such as wheat exports by means of the Alberta Wheat Pool. The design of economic instruments is a fine art and depends, among other factors, on their political acceptability and in turn acceptability is influenced by experience. Eight Alberta-made PV policies are discussed for the fastest growing economy in Canada. A population of three million with a corresponding economic growth rate of four percent over the past 10 years resulted in a GDP of 150.5 billion dollars in 2001. Also presented and discussed are factors such as Alberta´s environment, PV application in both rural and urban areas and it´s presence as a benefit to the province´s reputation as an innovator in the international energy industry.

The Technological Potential

The human population on Earth is now approaching 6 billion (1), and each of these inhabitants needs a base amount of energy necessary to sustain their lives. Exactly how much energy is required to meet such an incredible demand, and exactly which energy resources can mitigate such a provision are alarming questions that will need answers from present and future generations. One certainty however, is that the many emerging nations will be increasing their per-capita energy use significantly. For example, the Peoples Republic of China is now building electrical generating plants at the rate of 300 megawatts per week. These plants have been using relatively inexpensive, old, inefficient, coal-fired technology and provide electricity to predominantly inefficient end uses (2). The potential ramifications to the planet as a result of the continuation of efforts such as these are staggeringly profound.

Integration of Photovoltaic Systems in Alberta´s Energy Industry

Photovoltaic systems have obviously proven to be a cost-effective method for many applications worldwide. However, if PV is to displace a significant proportion of electricity generation in Alberta, another 20 to 30 years of aggressive market growth is required. This growth will depend on the continuous improvement of well-proven technologies, the introduction of new technologies, and a crucial interest and support program organized by the provincial government and Alberta´s utility companies found within the generation and retail sectors. To achieve the greatest cost-reduction, substantial research and development efforts are required. The „roadmap“ for photovoltaic research and development assumes continuous market growth, stimulated by market introduction programs and legislation that allows for fair access to the existing electricity grid and gives PV support similar to that given to traditional energy policies. Further penetration on a consumer-producer-based market can find representation in home-building policies, the manufacturing of new automobile technologies and urbanized and rural municipality services across Alberta.

Alberta needs to keep environmental economics, in principle, as the central part of its economic energy strategy. The human dilemma is now that growth on an economic scale is needed, but uncontrolled economic growth may ruin the very foundations of the standards of living already established in this province. However, arguments targeted at whether "growth" is positive or detrimental for "the environment", are superficial. The important factor, from an environmental standpoint is not the rate of growth of Gross Domestic Product, but its composition: the choice of production techniques and the relative importance of various sectors and activities. PV systems stand to make an important impact in Alberta´s energy market. This all depends in the end on the basis that the idea, product and penetration of PV systems must be well-developed and well-integrated within Alberta´s deregulated energy sector.

By evaluating system cost, cost reduction of stand-alone PV systems and grid-related generating PV systems, the primary obstacle facing mass PV implementation can be addressed. Despite falling prices, PV systems are still costly and the combined forces of the competitive market, governmental regulatory policies and the introduction of product education to the producer and consumer are needed to successfully bring PV systems affordably into Alberta.

Cost Reduction

The major obstacle to the widespread use of PV is currently the high capital and installation costs of the system. Owing to the long lifetime of 25 plus years, the absence of moving parts and the simplicity and reliability of PV systems, operating and maintenance costs can be very low. At present, installation costs are more or less equally shared between module costs and material balance costs. PV module costs have fallen sharply during the last two decades as the global market continues to grow.

Figure 1
Figure 1: PV Mean Module Prices and PC Market. (National Renewable Energy Laboratory. (1995). Photovoltaic energy program overview: fiscal year 1994 Series 1-12. Washington: Department of Energy Laboratories.)

PV modules fell from US$50/Peak Watt production in 1976 to less than US$5.5 in 1994 (Figure 1). In terms of current US$/Wp prices, this corresponds to a general trend of price decline of 10%/ year over the past decade. In 1988-1990 (3) however, unprecedented supply shortages of crystalline silicon wafer materials led to temporary high prices of PV modules (which actually translated to a slower price decline in generalized terms). After 1991, the previous rate of price decline resumed, owing to additional capacity coming on-line and a new surplus of electronics and solar grade silicon feedstock, such as thin-film materials. The present PV market situation is now characterized by over-capacity combined with increased competition in the power module market. In the near term, based on such factual information, price declines can be expected to continue.

But can these facts alone dictate a substantial price decline? What rate of decline can be forecast? Is there some sort of saturation point?

Figure 2
Figure 2:The PV Learning Curve. (Andereck, K. (2001). The integrated PV learning curve. Environmental design and construction. 4(2), 45-50.)

This situation is summarized in the PV learning curve (Figure 2). For many optimists there is enormous potential for further PV cost reduction through technological innovation and economics of scale. This situation is summarized in the PV learning curve. Based on the historical average price pattern, possible PV specific module prices down to US$1/ W produced for a world PV market of 1 - 10 GWp are forecast. Pessimists might on the other hand point out that this learning curve does not reflect the time variable. So, although the decline will almost certainly happen eventually, it could possibly be delayed for some time.

There are at least three good reasons to be optimistic about specific cost reductions of PV systems in the near time future. The first reason is that, until now, crystalline silicon modules using electronics grade silicon scraps as a feedstock have dominated the world PV market. The manufacturing processes are derived from the electronics industry and are not optimized for PV cell production. The annual production capacity is fairly low (roughly 5 MWp/ year for a single plant) (4). Electronics grade silicon scraps are becoming scarce and expensive. Significant cost reductions will be achieved as soon as dedicated production facilities for solar-grade silicon are justified by demand. As a matter of fact, Shell Industries recently announced a target price of US$2/Wp for Czochralsky-based silicon crystal modules to be achieved through wafer geometry (5). On a similar occasion, Solarex Corp. presented its module production goal of US $1.20 this year, within the framework of the US Department of Energy PVM program, to be reached by improved cutting, dedicated producers, and a threefold increase in production capacity.

Even sharper module cost reductions can be expected in the case of thin film PV cells, which is the second reason why the learning curve should see a steep slope within today´s market. Regardless of the basic semiconductors employed (amorphous silicon, CdTe, CIS or others), reductions in cost will occur. First, this is due to the use of a much smaller amount of semiconductor material needed in production which leads to lower energy consumption rates. Thin-film manufacturing techniques, allow also for the direct manufacturing of integrated solar modules, and are particularly well suited for mass production.

A final reason for confidence in significant price diminution is founded in the fact that several types of laboratory test cells show much higher efficiencies than those of present commercial modules, which still remain far below the theoretical limits (6). These very encouraging results will probably be transferred to the market within the next few years.

With these reasons there is substantial optimism that PV systems integration could very soon enter the electric market with an advantageous impetus. Learning by doing in large demonstration projects, for instance, has already led to cost reductions of 50% in the last 10 years (7). The present market situation, on the verge of a change in the slope of the learning curve, reflects a maturing PV industry emerging from the laboratory and entering the real energy market with promise.

Alberta´s Energy Industry: A Deregulated Market

To encompass a diffusion strategy for PV systems, a brief review of deregulation is presented with what may entail for the PV industry. Sustainable development and the implementation of eco-restructuring policies, government co-operation, leadership, vision, innovativeness and the importance of education and awareness are developed.

The retail electricity market in Alberta opened for competition, or in other words, became deregulated on January 1, 2001. This means that companies licensed by the provincial government can approach customers and negotiate contracts to supply them with electricity under rates that are dictated solely by market forces.

Delivering electricity to a customer in a deregulated atmosphere involves four steps: (1) generating the electricity, (2) transmitting the electricity to the provincial grid system, (3) distributing the electricity to the final destination or consumer, and (4) the selling, customer service, billing and related administration of taking the power from its source to its end user. To ensure the integrity of the provincial grid system and that all customers will continue to have access to electric power, the provincial government did not deregulate either the transmission or distribution systems. This means that the government continues to regulate these aspects of the electric system and ensures that reliable power flows where it is needed anywhere in Alberta. The elements of the system that have been deregulated are new power generation developed after January 1, 1996, and the retail sale of electricity to the final customer. By deregulating generation, any company that generates electricity is encouraged to strive for efficiency in order to "sell" their output at the lowest possible price. This was initially meant to also encourage the development of new or alternative generating technologies that may be more cost-efficient in some cases and/or more environmentally-friendly in others (i.e. alternative sources such as biomass, hydro, wind power, or solar power).

Capital costs for PV systems have been higher than present large-scale power plants, however, there is every sign that these prices stand to see more declines in real terms, in the future. This latter point however is very important, for the industry might be wary of investing large sums on risky schemes if there were a possibility that the potential of PV systems is degraded by high cost and other variables. Price protection, price guarantees, and tax considerations for the generating sector are some of the few measures to help reduce some of the uncertainties surrounding PV technologies, particularly in the province of Alberta which is familiar with price controls in regards to agriculture. Companies must be assured of receiving the full market price, or price protection, for electricity generated from PV systems. This top price should not be confined only to the additional electricity generated by these more striking methods, but to the whole of the production from a given plant, where PV generation is applied. In this way the revenue generated by more conventional and cheaper production methods can be used to fund inevitably PV enhancements. The Albertan Government and the AEUB, (Alberta Energy Utilities Board), the regulating body which has a hand in controlling electricity prices and taxation levels, should take prospective consideration in their fiscal policies of the possibility of companies introducing more energy efficient and environmentally friendly production methods at some stage in a generating plant´s life. In other words, generation plants should be allowed an adequate profit on the whole of the plants output. On the other hand, governments would be justified in monitoring closely the practices adopted by operators in each power plant to ensure that the maximum economic output is being achieved. Alberta´s government can learn from the U.K Government´s practice of awarding production licenses on a staged basis to its natural gas as well as its oil producers, which provides a useful mechanism of control (8). Plainly, companies must justify each stage of a plants energy output.

In an uncertain pricing environment such as today´s, it may be necessary for the Albertan government to underwrite a renewable energy project such as photovoltaic technology, by assuring an operator that he/she will receive a certain price for his electricity over a specified number of years, irrespective of world market conditions. This is the tool of price guarantee which has been used with the Alberta Wheat Pool during drought seasons and increased taxation on wheat and beef exports in the 1990s. If the market price turned out to be higher than the guaranteed price, the operator would have little problem in disposing of the PV generated electricity; in this case the Albertan government would share the incremental revenue on a pro-rated basis with the producer. If, on the other hand, the market price turned out to be lower, the government might make up the difference in price or it might decide to buy all or a proportion of the output itself. Guarantees to any single facility might be set at less than the full capacity. For example the government could guarantee 75% and the company could accept the pricing risk for the remaining 25%.

There would seem to be little need for sweeping new tax incentives, in terms of special concessions or subsidies to boost PV market penetration. However, some consideration should be given to the large amounts of high cost materials that are injected into the PV units themselves. The total cost purchased material should treated as an expense item and deducted in the year it was utilized, or it should be capitalized and depreciated over the life of a given generation plant. This way any company can demonstrate that a particular PV project is a failure, making no appreciable impact on overall electricity generation profiles, and then they can claim the cost of the invested material as a loss.

Policy Check List

The design of economic instruments is a fine art and depends among other things on their political acceptability, and this acceptability is of course influenced by experience. If Alberta´s energy industry is to maximize PV integration throughout the province, the following policy options ought to be considered and implemented:

  1. PV technologies should be used more widely:

    While inevitably they will be used to procure cost-efficient energy in hard to reach areas, the technologies should not be considered as merely a way of generating some electricity during a power plant´s life. PV projects should be applied as early as possible in other fields, taking into account economic considerations in home building, automobile production, roadside maintenance, and other commercial uses.
  2. Companies must be allowed to charge the full market value for all of their electricity production:

    The Albertan government and regulatory agencies should be prepared to offer further incentives, such as capitalization and subsequent depreciation of invested material costs, if these can be demonstrated as viable and necessary. Further incentives including tax credits may be necessary if electricity prices fall in real terms in the future.
  3. The Albertan Government and energy-producing operators alike should make themselves aware of the latest PV developments.

    They should accordingly review project development programs submitted by electric companies operating within the province. Regulating authorities might consider the approach of issuing plant development authorizations on a staged basis, thus, an operator´s electric generation can be assessed and monitored in much greater detail. The operator´s proposals for adopting PV systems would be one of the considerations in any stage-to-stage review of development plans.
  4. The Albertan Government should ensure that the operators´ initial development plans for fields do not preclude the possibility of initiating more advanced forms of energy generation such as PV systems.

    This is important where space is limited, such as on rough terrain, or obscure rural locations. Regulators should be satisfied that, if necessary, a power plant or consortium will be able to install and operate PV equipment at some point in a plant´s development, regardless of the location.
  5. The commercial application of PV generation cannot be attempted incrementally at a time.

    Its introduction, even on a localized basis, can have an impact on the producing characteristics of the plant as a whole. The Albertan government should ensure that they have powers to unitize the development of a power plant where more than one operating group has interest in a promising PV technology.
  6. Companies should ensure that there is a close liaison between their research and development staff and their PV application and production units.

    The former should be kept aware of the PV characteristics of all newly found technologies so that they can recommend the most suitable PV system. Application and production staff should be encouraged to undertake pilot projects in the fields of PV science early in the development stage.
  7. There is a general need on the part of the energy industry and Albertan government to educate the public about the future of the PV industry

    There is a danger in the current uncertain supply situation that the public will be given the mistaken impression that PV systems are on the verge of a short-lived limelight. The world is fast running out of economically viable natural resources. Already the public has questioned whether there will be a sizeable oil industry in 20 years´ time. This impression, coupled with the increased volume of rules and regulations aimed against current energy markets, should increase investor´s confidence in the PV industry. Indeed there are signs that these shortages and restrictions are already posing significant problems and as a result will open doors for renewable resources like photovoltaic technology.
  8. There needs to be an industrialized PV emergence in the Province of Alberta

    The electricity market should begin to emerge within Alberta´s industry taking into consideration and acceptance new PV technologies, companies dedicated to manufacturing PV cells and PV materials. These components will generate jobs and create a higher awareness within the province. They will also help avoid taxes from importing these materials from outside the province.

Externalities and Social Impacts - An Albertan PV-ready Society

Currently Alberta has the fastest growing and the strongest economy in Canada. Over the past 10 years, Alberta has an average economic real growth of four percent per year and in 2001 Alberta´s Gross Domestic Product reached 150.5 billion dollars (9). As the result of its booming economy, the population of Alberta has also seen a dramatic increase. According to the government of Alberta, the population of Alberta in the year 2002 was approximately 2,993,638. Compared to the population of 2,907,882 in the year 2001 (10) the population has increased three percent in just one year. Although the rapid population growth is beneficial to the growing economy, it is also creating many problems for the province´s energy supply and demand. To accommodate this increasing energy demand, the possibility of adopting photovoltaic technologies into the province should be considered. However, as important as it is to pay particular attention to the economic implications that PV integration can introduce, it is as important to consider and contemplate the social outcomes of such an endeavor. Factors such as Alberta´s environment, its application in both the rural and urban area of the province, and finally its presence as a benefit to the province´s reputation on an international scale cannot be undermined and overlooked.

When proceeding with the implementation of any intermittent power supply, the success of the transition is partially influenced by the amount of consideration brought towards externalities that may affect some aspect that concerns the overall success of PV system implementation. Externalities are usually situations whether physical/political/economical that have indirect relationships with the overall use of an idea or product. For photovoltaic systems, the climate, sunlight, acceptance, and political atmosphere are all externalities that need to be addressed.


Photovoltaic systems are related to temperature in regards to maintainability and efficiency. Generally, it can be expected that photovoltaic systems can and will probably function well under hot conditions. Places like Arizona, and Nevada prove such a conjecture for photovoltaic technology. These areas have significant hours of sunlight and markedly high temperatures, hence, a wide range of applications. However, the actual durability and efficiency measurements from photovoltaic cells under cold conditions and extreme weather have been more than startling. For example, the International Space Station is powered by a photovoltaic system wherein the temperature approaches "absolute zero" or -273 degrees Celsius (11). If photovoltaic cells can operate at "absolute zero" temperature, powering an entire space station that spans the length of almost 400 meters, it can certainly operate under the cold temperatures of an Albertan winter. This characteristic of photovoltaic cells has made them ideal for the climate of Alberta. Studies have recently shown that the efficiency of many PV stand-alone and PV grid systems actually have better efficiencies than in relatively hot climates.

Figure 3
Figure 3: Average Temperature of Alberta over the last 30 years (Government of Alberta. (2002). Agriculture food and rural development [Online]. Available:$department/deptdocs.nsf/all/. [2003, August 1st] )

In Figure 3 the temperature of Alberta over the course of one year is identified. It should be noted that different regions of Alberta have very different temperatures. Southern Alberta tends to be warmer and the Northern regions tend to be colder (12). Since the photovoltaic cell can produce electricity under any temperature, we can expect consistent electricity output from a PV system at any temperature as long as there is sufficient sunlight.

Hours of Sunlight

The working principle of photovoltaic systems is to convert the photons that comprise sunlight, into electricity, known exclusively as the photovoltaic effect. Hence the amount of sunlight directly influences the performance of a photovoltaic system. Alberta is located at the northern hemisphere and the amount of sunlight the province receives varies over a year. Typically, during the summertime the province receives an average of 16 hours of sunlight, and in the winter time the province will receives about 7 hours of sunlight.

Figure 4
Figure 4: Hours of Sunlight Recieved by Edmonton in 2002 (Thorsen, S. (2003). Sunrise and sunset in Edmonton. [Online]. Available: [2003, July 26th] )

In Figure 4, the city of Edmonton´s sunlight history is utilized as an example and it represents the average daily sunlight for the entire province. Alberta receives a maximum amount of sunlight around July and August. For those two months Alberta can attain about 17 hours of sunlight every day. Such conditions are promising for PV-systems and could be exploited in the nearby future. However, Alberta is granted considerably less sunlight in December and January. For those two months Alberta only receives about 8 hours of sunlight every day. Therefore the Photovoltaic cells are only able to produce a limited amount of energy. By designing a PV system around the minimum and maximum sunlight hours would provide the needed input variable to set up a photovoltaic alternative in the Prairie province.

Applications of Photovoltaic Cells

Figure 5
Figure 5: PV Applications (EUREC Agency. (2002). The future of renewable energy: prospects and directions. London: Crombell Press.)

PV systems are highly modular and therefore offer a dynamic range of applications. Figure 5 summarizes the applications of PV systems as a function of installed peak power. As shown, the range of possible applications extends from very small devices such as solar calculators or watches to the grid-connected multi-megawatt power plants. But it wasn´t until the 1950´s that photovoltaic cells were utilized to generate electricity (13). Photovoltaic power systems today generate the electricity used to pump water, light roadside lights, provide power to emergency phone systems, activate switches, charge batteries, supply the electric utility grid, and a plethora of other applications as well. Today photovoltaic technology powers virtually all communication satellites (14). Photovoltaic systems provide energy to the Hubble space telescope and the International Space Station. The practical transition of PV technology from calculator to satellite is obviously incredible.

PV for Households

Today PV systems for communications and solar home systems have the largest market share (21% and 15% respectively) in the PV industry (15). The application of building-integrated PV systems is particularly interesting because it demonstrates several advantages compared with conventional PV power plants. First, the occupation of surfaces already used for other purposes substantially reduces the main environmental obstacle to the adoption and diffusion of PV, namely land requirements. As a consequence, it greatly increases the potential applicability of PV in areas of high population density. Second, integration into already existing or planned supporting structures and the substitution of building envelope materials reduce total system costs. Because total energy consumption during the manufacturing and installation of the systems is reduced, the energy payback time of the PV system is also reduced and its (indirect and low) environmental impacts are also lowered. Finally, this application actually expands technological potential of PV systems even further, because in buildings, they can play more roles than solely producing electricity. Building integrated PV panels, in theory can save energy when used as sun shading systems. Moreover, in buildings, there is the possibility of recovering a significant fraction of the thermal energy dissipated by solar panels. This thermal energy can be used directly for room heating in winter and for heating of water in all seasons. The coupling of PV building-integrated systems with solar-passive, bioclimatic architecture and energy-saving measures has enormous potential. The phenomenon of integrated-building PV systems raises the number of interested and involved actors by orders of magnitude on both the demand and supply side. The result will both promote competition and investment in the PV sector. PV will be a subject of interest not only for the limited number of Alberta PV industries but potentially for architects and engineers, as well as their clients.

The number of photovoltaic powered households is increasing. Typically there are two types of Photovoltaic technology used for household applications: Stand Alone, and Grid-connected systems. Stand-alone PV systems are typically referred to as autonomous photovoltaic systems that operate independently from any electricity grid. This system generates electricity to run the application and store any extra energy in batteries. The batteries take over whenever the solar power cannot sustain the need of the application. Conversely, if there is an excess of solar power and the batteries are full, this power is lost. Grid-connected photovoltaic systems are directly connected to the electricity grid. The system can supply any surplus of energy to the grid, or extract energy if the generator does not meet the demand (16). In Alberta, any excess of electricity on the grid can be sold back to the open market, which dictates prices based on the Electric Price Pool. Grid-connected photovoltaic systems can be used if the house is very close to an electric grid. Otherwise, under the assumption that the building is located in a remote area, where distribution lines difficult and inefficient to use, stand-alone photovoltaic systems are better suited. Since PV systems are installed by modules, the entire system itself can be constructed to any size based on the energy requirement. Hence, the energy extracted from the sun can be used to supply all a household´s electricity needs, or synergize with other forms of electric generation to reduce costs and to increase conservation. The application of a Photovoltaic home is very ideal for Alberta, because the photovoltaic home is relatively inexpensive to construct, very energy efficient, and requires little maintenance and can save up to 95 percent of energy used and consequently leads to reduced charges found on the typical electricity bill (17).

Application of PV in Urban and Rural Areas

One of the simplest applications of photovoltaic cells is found on every day calculators. These calculators are dependant solely on light. This of course is a matured market in the small electronics industry. However, the exposure people have had to such a product has not been enough to introduce PV on large scale projects. Much more education is required to supplement such a success in the PV industry. Also in countries like the Netherlands photovoltaic systems are commonly used to power water-pump and water management systems. Today more than 10,000 photovoltaic power water pumps have been installed worldwide (18). PV water-pumps are preferable because of their high reliability and low operating cost. Photovoltaic technology also powers the electric motors of ships. Such systems have become very popular because they are very quiet when operating, produce no air pollution and prevents water pollution otherwise present with the spilling of fuel. In Portugal, photovoltaic systems have been used to power parking meters. Advantages of such an innovation include the little maintenance required, flexibility in location and placement considerations as such a device is independent of the electric grid, and finally it´s economic dominance over grid connected parking meters and battery powered parking meters. In Sweden and Switzerland, photovoltaic systems have been used to power bus shelters in the winter, and to provide illumination. The system has low operating costs, simple installation and its freedom from the utility grid is welcomed (19). Thus, there are many applications for photovoltaics in urban areas, of which many, if not all, are suitable for Alberta.

Application of PV in rural areas

To see the true value of photovoltaic technologies, applications within Alberta´s rural areas should be considered especially in places where no power lines exist due to physical and economic inhibitions. For this reason, photovoltaic technology is already seeing increased applications in rural areas all over the world. The cost of extending the power lines to a remote area can be enormous and gasoline or diesel generators are noisy and inefficient. Also, customers in rural areas tend to pay exponentially more on their electric bills, strictly because of distribution charges. These charges are composed of the cost of delivering, maintaining, and compensating for these lines. Distribution line loss, the amount of energy lost as heat as a result of the resistance in the wires themselves, end up being billed completely to the customer. PV systems stand to change this atmosphere dramatically. Finland as an example currently has 20,000 summer-cottages or remote homes that are powered by photovoltaic systems, and there are 150,000 more without electricity because power-lines either can not reach the area, or because it is economically unsound (20). Photovoltaic systems have become a reliable and very handy for delivering power to places that the electric power-grid can not reach. In Canada, photovoltaic systems are used to power mountaintop repeater stations. The advantages of such a system include its low life-cycle cost, high reliability and low pollution. In Japan, photovoltaic systems are being used to power entire remote islands. Japan relies quite heavily on imported energy supplies. PV systems, as an alternative have now allowed Japan to crawl out of economic bankruptcy and begin leading the world in the development of a plausible PV industry. In these remote islands a centralized power plant generates electricity by thousands of photovoltaic arrays and delivers the power to households. Such a system is very cost efficient, highly reliable, environmental friendly, and its existence worked to significantly lower Japan´s and many of these islands´ need for electricity from abroad (21). Perhaps one day, photovoltaic systems such as those already aforementioned can be used to power the remote farms of Alberta or entire mountainside resorts within the province.

The Environmental Situation

In the effort to reduce green house emissions to sustainable levels, Canada has ratified the Kyoto Accord and agreed to reduce its national (GHG) emissions to 5 percent below the 1990 level by the year 2010 (22). In the year 2000, Canada emitted 529 million tonnes of carbon dioxide, a purported GHG, which surpassed the 1990 emission level of 466 million tonnes by 14 percent (23). Out of the total 67 million tonnes of coal consumed by Canada that year (24), Alberta consumed 29 million tonnes (25). Alberta consumed 43 percent of the total coal consumed by Canada. If the country hopes to reduce its carbon dioxide emissions down to 424 million tonnes by 2010, Alberta as a province must dramatically reduce the amount of coal it is using within its industries. According to the Government of Alberta, 84 percent of Alberta´s electricity is produced by coal (26). The question now has become whether Alberta can produce sufficient electricity such that it meets the demands of the population, while under the imposition of the Kyoto Accord. The solution to this problem includes the introduction of photovoltaic technology to the energy market. By producing electricity in part from photovoltaic as well as other renewable and non-renewable resources, the amount of coal and natural resources required to provide power to all of Alberta will decrease. Ultimately, utilizing photovoltaic technology will help Alberta maintain economic sustainability.

The ever increasing population of Alberta and the corresponding economic growth rate has placed a burden on energy supply and demand and ultimately the price of energy has seen rises that have not been at all well received. If photovoltaic resources are used to produce energy, it will provide more efficient energy production to meet the increasing energy demand that is completely weighted on natural resources. Reducing the stress on Alberta´s energy system, and ultimately reducing the cost of energy, will consequently leave people with more money to spare, and that will lead to increases in consumer spending on other goods and services which will help Alberta´s economy improve, demonstrating one of the best standards of living for Albertans in the world.


The authors have presented an analysis for the integration of PV systems within Alberta-the fasted growing economy in Canada. PV systems, if incorporated into long-term goals for the energy market, will find a successful niche in our society. PV systems are fully compatible with today´s market. By overcoming the burden of capital cost, the development of crucial policies, the integration of stand alone systems across various industries in Alberta, and the enhancement of educative programs established for producers and consumers, PV systems will stand to make incredible contributions in the issue of energy efficiency, conservation and Alberta´s role as a leader in alternative energy integration on an international scale.


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