If the ‘International Energy Agency’ based in Paris is to be believed, solar power will be the chief source of energy fuelling more than 90% of the world’s electricity requirements. On one hand, as demand for tapping solar energy to generate electricity keeps on rising with every passing day with rising unit costs of harnessing the non-renewable energy sources on the other, the economic viability or feasibility of the former process is being increasingly debated. It is also worth noting that the continuously perpetuating demand for solar energy will lead to an investment boom (for manufacturing photovoltaic cells and other types of solar heat collectors) estimated to be around $44 trillion.
On a comparative basis, the $900 billion that is being pumped in for the mining and extraction of fossil fuels is peanuts. However, this welcome news scoop has not yet encouraged angel investors and budding industrialists or large corporations around the world to weigh the pros and cons of building a solar thermal plant or system. It is only in a few select industrialized nations like Norway, Denmark, Iceland, France and USA that stakeholders have made themselves busy banking upon acquiescent administrative regimes and on subsidies doled out by them.
The IEA has also iterated that prices of photovoltaic panels will tumble by 70% for power generation firms and 60% for households resulting in considerable economy of scales. Furthermore, the cost of installing a solar panel has come down to $0.80 from $4 per watt in 2008. The years to watch will be between 2025 and 2030 when carbon (the source of fossil fuels) will cost about $50 a ton as against the $100 per MWh (megawatt hour) solar power cost. Carbon costs are expected to shoot up to $150 (per ton) by 2050 presuming that the lonely planet will use fossil fuels restrictively. More long-run PPAs (purchase power agreements) for setting up solar plants are being signed than PPAs for setting up fossil fuel plants which strongly indicates solar power will be economically reasonable in the near future.