Oil prices have come down dramatically. Gasoline is suddenly cheaper than it has been in a long time. Historically, every time fossil fuels get cheaper for a while, people lose interest in alternatives like solar energy. That may be about to change.
For 20 years or more, there has been talk of “grid parity” as the seemingly unreachable goal for solar power. Grid parity means that an alternative energy source can generate electricity as cheaply as it can be purchased from the grid including all pertinent costs.
According to a recent report from Deutsche Bank, solar electricity is on track to be as cheap or cheaper than average electricity-bill prices in 47 US states in 2016. That assumes that the 30% tax credit for installing solar power stays in place. But even if the credit drops to 10%, 36 states will reach grid parity by that year.
Solar power used to be an exotic hobby for rich environmentalists. Those days are long gone. Solar power is becoming mainstream and prices will continue to drop with improving technology and the growing availability of favorable financing.
The reason solar power is likely to dominate as an energy source is that it is a technology, not a fuel. Fossil fuels are limited in quantity and can only become more expensive to extract and process. Sunlight is free and plentiful; the technology for using it becomes more efficient and cheaper to use all the time.
So even if oil prices stay low for a while, solar energy will continue to become a bigger and bigger part of our world.
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While You Were Getting Worked Up Over Oil Prices, This Just Happened to Solar
Photo, posted May 20, 2010, courtesy of Black Rock Solar via Flickr.
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Earth Wise is a production of WAMC Northeast Public Radio.