A new report from a respected German energy think tank highlights the rapid drop in the price of solar energy. Agora Energiewende's comprehensive report uses current and past statistics about the reduction in the production price for solar PV panels to project into the future. Their forecast indicates that solar PV-based energy will be the cheapest source of power within the decade and down to an amazing US 2c/kWh by 2050, much cheaper than gas-fired power plants at US 9c/kWh or any other form of fossil fuel including coal.
The report does not include the potential for any breakthrough technology to solar panels, but instead marks the steady and inexorable economy of scale that is coming into play with the manufacture, distribution and consumption of solar energy at both the utility and rooftop scale. Although the report frames its outcomes with rigorous analysis and data to back it up, similar conclusions can be reached by following Swanson's Law. The law (really more of an observation) was coined by Richard Swanson, the CEO of solar panel company Sun Power in an interview the Economist Magazine. It states that the price of PV panels drops 20% when manufacturing capacity doubles. At the current rate, the cost of PV panels per kilowatt of energy halves roughly every ten years.
What does it mean for Cleanleap Countries?
Whether or not solar power will truly be the cheapest form of energy depends on where you live. A global insolation map indicates that Cleanleap countries have the greatest potential to reap the benefits of cheap solar power, while countries in Northern Europe, Canada and North Asia may see cheaper prices with wind, marine or other renewable technology. Longer term, cheap and abundant solar energy has vast implicatons for the poltical and economic distribution of wealth around the world. Cleanleap countries may find that the export of eleictrical energy is a primary industry and a source of wealth that is indeed renewable and neverending – at least for the next 4 billion years or so.
Read the presentation (PDF): Current and Future Cost of Solar Photovoltaics
Read the full report (PDF): Current and Future Cost of Solar Photovoltaics