Even as wind energy production struggles, solar power seems to be shining bright. From 1.4 gigawatts (GW) today to 44 GW by 2020, to be more specific. That’s the educated guess from Bloomberg New Energy Finance on the big leap in solar generation we’re due for here in the United States. The Bloomberg analysts credit “declining equipment costs combined with strong government backing” for making this growth likely.
The new Bloomberg report highlights how important the government support for solar has been and will continue to be. Although “the cost of a typical photovoltaic module has dropped by more than half over the past two years,” Bloomberg placed “the unsubsidized cost of best-in-class photovoltaic and solar thermal electricity generation at just below $200/megawatt-hour (MWh).” A coal-fired power plant, meanwhile, produces power for $56/MWh.
Of course, that doesn’t factor in all of coal’s externalities, and environmentalists argue that doing so shifts the cost equation more in solar’s favor.
Bloomberg said the two main means of solar production, photovoltaics and large-scale solar thermal, will see similar rises in capacity in the unfolding decade. Photovoltaics will grow from around 1 GW to 30 GW, while solar thermal will rise from 0.4 gigawatts currently to 14 GW by 2020.
As for solar investors, who Bloomberg said will pump $100 billion into the solar business in the coming decade, they are advised not to get hung up on where the sun shines in deciding where to place their bets, at least for now; a more important factor in determining the viability of a project, Bloomberg said, was the price of electricity and the incentives available.
“Policy, rather than sunshine, will remain the U.S.’s greatest solar resource for the next few years,” said Milo Sjardin, Bloomberg New Energy Finance’s U.S. head of research. “By the middle of this decade, however, the U.S. retail solar market will be driven by fundamental, unsubsidized competition, which should transform the U.S. into one of the world’s most dynamic solar markets.”
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