Forecast for Solar: Don’t Like the Weather, Wait Five Minutes and It’ll Change

In the Pacific Northwest, it’s a cliché that the weather is always changing, from rain to sun and somewhere in between—often within a 60-minute timespan. The past year has been like that for solar energy markets in the U.S.

  • The price of installed solar PV has plummeted and is approaching the point at which we no longer should even pretend that solar is a more expensive alternative than other forms of energy. Kees Van Der Leun wrote about this on Grist this week, highlighting a way to think about solar PV economics into the future.
  • Our vastly inadequate federal and regional energy policies have created confusion and uncertainty to the detriment of solar industry companies and interested renewable energy investors. Interestingly, General Electric’s Vice President for Ecomagination Mark L. Vachon noted October 12, at a Green Business Innovation Forum in San Francisco, that Australia was getting close to adopting a carbon tax, which would help reduce uncertainty and reinvigorate investment. Just one day later on October 13 Australia took that very step.
  • Rapid growth in global solar manufacturing capacity has changed not only what it costs to put solar panels on buildings, but also the trajectory of the clean tech sector. And the growth is not limited to China—even though U.S. solar manufacturing has experienced a pretty significant shakeout in the market, there is good news as well. General Electric announced this week that it was building a thin-film solar manufacturing facility in Denver.

If we step back from the latest developments, there are a few broad, but important characteristics of solar energy that should be top of mind:

  1. Solar energy will continue to emerge as a compelling source of renewable energy. However, we would do well to embrace efforts to put solar everywhere that access to the sun is good and there are willing building owners. In the U.S., we could adapt strategies used in Germany, where they have sought to put solar on every rooftop.Rooftop solar will only become ever more cost effective and more tightly integrated into the building itself. Witness the investment Dow Solar has made to create solar power generating shingles. Such an intensive installation strategy in the U.S. could have significant benefits across large areas of the U.S., as John Farrell of the Institute of Self-Reliance notes in Grist, offering the potential to provide power to millions of homes.
  2. Energy consumers like solar and we should make it much easier for them to pay for it. As energy users, we perceive solar energy differently than other forms of energy, which means that all electrons are not equal from a business perspective. This assertion, which I think has been demonstrated but not quite analyzed to death, means that we should re-think our energy pricing, policy, and incentive structures so people can have easy access to solar power. Greater market choice for consumers would further accelerate growth in solar energy installations.
  3. Distributed solar installations provide new opportunities for local ownership and community economic development benefits. Locally owned enterprises for solar deployment produce three times the total economic impact in our communities. We should be helping communities create enterprises for residents and small businesses to access solar energy as energy users, and also to participate as investors. Germany has illustrated this potential and in Oregon we have a growing number of communities – from Pendleton to Portland – moving ahead with community-owned solar projects.

The weather is changing and will continue to change, but the sun will always come out.

, Climate Solutions