One of the most pervasive myths hampering the move to renewable energy is that it’s too expensive. Certainly in the early days, solar energy installations were more costly than energy sourced from fossil fuels, but those days are far behind us now and, according to the National Renewable Energy Laboratory in 42 out of 50 US cities, rooftop residential solar is cheaper than grid power; good news for the consumer and great news for the environment.
“Right now, buying an average-sized, fully-financed solar PV system costs less than electricity from their local utility for 93 percent of single-family homeowners in America’s 50 largest cities, and in most places, is a better investment than many of the stocks that are in their 401(k),” said Jim Kennerly from the Going Solar in America report. “Nevertheless, most people are unaware that solar is this affordable for people of all walks of life.”
According to one study, the US could power itself 100 times over with solar which is an abundant resource that isn’t going to be running out any time soon. Add to that the leaps and bounds by which
energy storage is improving and you have a great case for moving to renewable energy sources.
When solar first came on the scene, costly panels and large, expensive battery banks made solar energy an option for only the rich and eccentric. But as feed-in-tariff schemes in Europe made solar a more attractive investment, technology improved and prices dropped. A report by the Lawrence Berkeley National Laboratory showed that the median cost of a residential solar installation dropped from $12 per watt in 1998 to $4.70 per watt in 2013. 2014 saw an even greater drop to $3.60 per watt according to GTM Research.
When China joined the market with cheaper solar panels and large investments in renewables, specifically a 32 percent expansion commitment, the price of solar installations finally became competitive.
In addition to a drop in the price of solar technology, the slump in oil prices has rendered hard-to-reach reserves uneconomical, and this has spurred investment in renewable energy. According to Bloomberg
New Energy Finance:“New funds for wind, solar, biofuels and other low-carbon energy technologies gained 16 percent to $310 billion last year. It was the first growth since 2011, erasing the impact of lower solar-panel prices and falling subsides in the U.S. and Europe that hurt the industry in previous years.”
A report by the North Carolina Clean Energy Technology Center, backed by the SunShot Initiative, shows that in 42 cities, solar energy is actually cheaper than grid energy. The report estimated that 9.1 million families in the 50 cities investigated would pay less on their utility bill if they installed a residential solar system, while about 21 million would benefit from residential installations if financing was available.
Grid energy isn’t getting any cheaper either, and EIA forecasts predict that utility rates will increase between 33% and 83% over the next 25 years. On the other hand, the cost of solar just keeps falling, which makes the future for this renewable energy source brighter than ever.
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