The Future for Solar is Bright
Author: Tony Giunta, Director of Project Development
Benjamin Franklin once said, “There are only two things certain in life: death and taxes.” While I’m not here to challenge old Ben, I’ve lived long enough to confidently add one more certainty to his list: “There are only three things certain in life: death, taxes, and the sun will rise tomorrow.” With that third certainty comes the opportunity to harness a free source of energy to power our homes, businesses, and planet.
Although the ability to consistently capture an unlimited free power source sounds like a “no-lose” business proposition, the solar industry has always faced stiff headwinds. Its most formidable challenge has been to lower the cost of converting that free energy into a usable form that is competitive with fossil-fueled sources (brown power). This challenge is compounded by the need to navigate the continuously shifting support for politically imposed subsidies designed to “level the playing field” between the comparatively higher cost of green solar and cheaper brown power.
So, knowing that cost is the pivotal factor, can the solar industry ever achieve price equity with brown power? I believe the answer is a resounding yes!
As is typically the case, technology is revolutionizing the solar industry (I’m sure Ben Franklin would appreciate my choice of words here!). Solar photovoltaic panels are becoming more efficient at lower production costs. Five years ago, it cost nearly $4 per watt to produce solar power. Two years ago, that cost was halved to $2 per watt, and today it has halved again to just under $1 per watt.
In terms of cost per kilowatt-hour, ten years ago when Nobis started working with solar developers, the price needed to support a solar project was in the 12-15 cent per kilowatt-hour range compared to 6 cents per kilowatt-hour for brown power. Today, solar developers are building projects with a sale price of 8-10 cents per kilowatt-hour. As you can see (and what should be music to everyone’s ears), solar power is rapidly closing the price gap with its archrival, brown power.
The rapidly falling price of solar really “kills two birds with one stone.” As the price gap narrows, consumers generally choose greener resources. And with that all-important consumer choice, the need for unpredictable and controversial subsidies evaporates. Case in point: solar power is the leading source of renewable power installation in the nation. In 2023, the solar industry set a record by installing 32 gigawatts of solar energy. In 2024, that record was shattered with over 50 gigawatts of US solar installations. Considering each solar gigawatt of power is like building a nuclear-powered facility, the 2023 and 2024 solar installations are equivalent to having built nearly 75 new nuclear power plants, with the added benefit of not having to worry about nuclear waste.
Thanks to advanced technologies, lower equipment costs, and a diminishing reliance on subsidies, the future of solar looks bright (pun intended)!