Solar cost reduction through technical improvements: the concepts of learning and experience

The concepts of learning and experience are reviewed and their usefulness for predicting the future costs of solar technologies are evaluated. The literature review indicated that the cost estimates for solar energy technologies are typically made assuming a fixed production process, characterized by standard capacity factors, overhead, and labor costs. The learning curve is suggested as a generalization of the costs of potential solar energy systems. The concept of experience is too ambiguous to be useful for cost estimation. There is no logical reason to believe that costs will decline purely as a function of cumulative production, and experience curves do not allow the analyst to identify logical sources of cost reduction directly. The procedures for using learning and aggregated cost curves to estimate the costs of solar technologies are outlined. It is recommended that production histories of analogous products and processes are analyzed and the learning and cost curves for these surrogates are estimated. These curves, if judged applicable, can be used to predict the cost reductions in manufacturing solar energy technologies