In the last five years, we’ve seen an incredible rise in the popularity of solar power. As the energy efficiency and environmental benefits of solar become more and more apparent, the number of people interested in generating their own solar energy has increased by leaps and bounds.
Solar power has developed into a popular option for everyone from homeowners who want to generate their own energy to savvy businesses that want to reduce their energy bills. In fact, a recent report from the Solar Energy Industry Association (SEI) forecasted that the market for solar energy in 2022 would reach 132 GW, a number that represents a 23% increase from 2021.
What has caused this unprecedented rise in demand? There are a number of factors that have contributed to the growth of solar, but the rise of solar power has mostly been fueled by three things: cost, price, and legislation.
Cost, Cost, And Cost
While solar has always been a popular option among environmentally conscious individuals and businesses, its rise to the top has been enabled by cost-effective initiatives and advancements made by the solar industry itself.
The cost of solar power has decreased significantly in the past five years. This has led to a 23% increase in installed capacity between 2021 and 2022. The cost of solar photovoltaic (PV) modules has dropped by 27% between June 2021 and May 2022, and the cost of solar cells has fallen by 22% in the same time period.
The price of solar power has also decreased significantly. As we’ve mentioned, the cost of solar modules has decreased, and this has been coupled with a 17% drop in the cost of solar power systems. Furthering the trend, the cost of solar power batteries has decreased by 40% in the last five years.
The combination of these factors—the decrease in cost coupled with the increase in demand—has essentially made solar power a no-brainer for anyone interested in generating their own energy. The fact that the price of solar has decreased so significantly means that even more people can now afford to have a go at generating their own power. As a result of this, we’re seeing a steep rise in the adoption rate of solar energy worldwide.
Price And Volatility
Not only has the cost of solar power decreased, but its price has become more stable. In the past five years, we’ve seen enormous volatility in the price of traditional forms of energy—most notably, fossil fuels. As a result of this, energy producers have tried to ensure that their customers remain protected from any fluctuations in energy prices by offering guaranteed price agreements. However, with the development of cheaper and more stable solar alternatives, this guaranteed price agreement has become less of an issue for solar power users.
Furthering this point, in March 2021, the UK government announced a new guaranteed price agreement for electricity generated from solar farms. Essentially, the government will guarantee a certain amount of money for electricity generated from solar farms. While this agreement provides some security for solar farm owners, it also means that buyers of this energy will be subject to any future changes in energy prices. This could potentially lead to a significant increase in the price of electricity purchased from these sources if energy prices go up. To avoid this, many people are turning towards solar energy, since the cost of solar is more affordable and more stable than most traditional forms of energy. As a result of this, we’re seeing a massive increase in the use of solar power worldwide.
Legislation
The third factor that has driven the growth of solar power is legislation. Around the world, more and more governments are recognizing the potential of solar power and the role that it can play in reducing their energy dependence. For example, in the UK, the government has committed to reducing its energy consumption by 80% by buying only green energy by 2025.
In the US, the government has mandated that all new homes built in the future must have at least six solar cells installed on the roof. Furthering the trend, China has committed to generating 40% of its electricity from renewable sources by 2030.
Further legislation is being proposed in places like Denmark, where the government has proposed a complete ban on plastic straws and a 25% reduction in plastic water bottles. These places are seeing the widespread adoption of solar power because the government sees it as a responsible and sustainable option for generating electricity.
The combination of all these factors—the decrease in cost, the decrease in price, and the increase in demand—have made solar power a no-brainer for anyone interested in transitioning to a green energy source. With the advantages and benefits of generating your own energy already widely acknowledged, the next step for anyone interested in going green is simply to switch on the power of the sun.