A new report from the Institute for Local Self-Reliance (ILSR) suggests that nearly 100 million Americans could receive electricity from solar panels on their roofs for less than grid prices by 2021. The report is just one more indication of the widespread changes that could occur when solar power final achieves grid parity – a time when unsubsidized solar power is just as cheap as electricity from the grid.
Parts of the world are shifting gradually towards grid parity as the costs for solar decrease and electricity prices increase. Already, China has made big plans for solar power in anticipation of grid parity over the next few years. India has also followed suit, with a plan for 33.4GW of solar power by 2022. And in the U.S., energy secretary Steven Chu has said that solar prices could drop another 50 – 70%.
As solar prices decrease, it becomes increasingly cost effective for American households to install solar panels on their roofs. Although the initial capital costs for solar panels can be quite high, these costs are more than paid for in energy savings over the long-term. But even if the initial costs are too high for some households, companies such as SolarCity have developed ingenious solar leasing programs to amortize these costs over several years.
In fact, for a number of reasons, solar could really explode over the next ten years.
The ILSR report only takes into account residential buildings in the 40 largest Metropolitan areas in the United States. If one were to take into account commercial buildings and rural areas, these numbers would be even higher. In fact, an article on grist.org suggests that the potential solar universe in 2021 could be 500,000MW, which equates to 17 percent of electricity consumption in the US.
What are your thoughts on the implications of grid parity in the US? Do you think people will in fact embrace solar power if it is cheaper than grid power in the long-term?
Image CC licensed by Kevin Krejci: San Francisco rooftops