For years, the idea of harnessing energy from the sun has been a dream. Some say, a pipedream. But Joshua Pearce, an associate professor of electrical engineering and materials science at Michigan Technological University, isn't one of them.
While solar power currently produces less than one percent of U.S. electricity, Pearce says it can be much more than a boutique source of power.
A new analysis by Pearce and his colleagues at Queen's University in Kingston, Ontario, shows that solar photovoltaic systems – which convert sunlight directly into electricity - are very close to achieving the tipping point: they can make electricity that's as cheap—sometimes cheaper—as what consumers pay their utilities.
Pearce says he sees an approaching tipping point for two reasons. First, the price of solar panels has plummeted.
Costs drop 70 percent
"Since 2009, the cost has dropped 70 percent," said Pearce.
But more than that, the assumptions used in previous studies have not given solar an even break, he maintains.
"Historically, when comparing the economics of solar and conventional energy, people have been very conservative," said Pearce.
These comparisons, he says, don't take into consideration the declining costs of solar-generated electricity. Also, he notes, the price of solar equipment has been going down.
Out of date figures
Equipment costs are determined based on dollars per watt of electricity produced. One 2010 study estimated the cost per watt at $7.61, while a 2003 study set the amount at $4.16. The true cost in 2011, says Pearce, is under $1 per watt for solar panels purchased in bulk on the global market, though system and installation costs vary widely.
Solar costs also remain high in some areas because there aren't enough trained installers. Some contractors will limit the number of installation projects they will take on, charging more for the jobs they do take.
"If you had ten installers in Upper Michigan and enough work to keep them busy, the price would drop considerably," Pearse maintains.
Based on the study, and on the fact that the cost of conventional power continues to creep upward, Pearce believes that solar energy will soon be a major player in the energy game.
"It's just a matter of time before market economics catches up with it," he said.