In 2012, solar energy experts predicted that by 2021, solar energy would cost the same or less than power from the utility companies.
That equality of price between solar power and traditional electricity supplied by the grid is known as grid parity. Parity is coming sooner than you may think. In fact, we predict that 2016 will be the year!
Factors of Price Parity
The biggest factor in price parity between solar energy and grid electricity is today’s historically low cost.
The price of solar energy has dropped rapidly over the past few years, to what most experts believe is the lowest point it can feasibly reach. This has made photovoltaic systems much more economical than anyone anticipated, especially in large cities that are denser in population.
Industry experts missed the mark on grid parity predictions because up until now, projections were based on federal, state and local incentive availability. It turns out, however, that parity between solar power and electric grid power has accelerated even when no incentives are available.
Large Cities Reach Parity Faster
Before 2015, the industry expected that only two large metropolitan areas would reach parity, containing a total of about 22 million residents. In actuality, 2015 saw parity achieved in six major metro areas, representing over 30 million people.
Based on the state of the industry through 2015, analysts now predict that 71 million people will be at parity by the end of 2016, instead of the originally projected 51 million.
By 2021, parity will have been reached for 109 million people (about a third of the population) in the United States!
If we break it down even further, power generated from PV panels costs, on average, about $3.50 per watt, and that matches the average electricity rate. Again, that figure discounts any available incentives.
With the updated parity numbers now being reported, future data will concentrate on the net value of solar investments in cities across the United States.
What the Future Holds
Even in rural areas and those cities that have not reached parity, the investment in solar energy still makes sense. Over the long term, solar prices will remain fixed, as opposed to traditional electricity rates, which vary. In fact, utility companies have actually stepped up their rate increases over the past few years, in an attempt to shore up the rapidly deteriorating grid infrastructure.
Once upon a time, solar power was viewed as a futuristic concept, like something out of science fiction novels. The 21st century has brought with it rapid advances in technology, and solar energy parity is shaping up to be one of the most important we will see in our lifetimes.
Photovoltaic power represents energy that has no end and will never run out, and now it is truly affordable for everyone.
You have no reason not to make the switch yourself to PV energy. Contact Intermountain Wind & Solar today. We design and install PV panels and systems throughout the Intermountain West, and we are proud to bring this economic form of energy independence to you. Call us today to learn more about how solar energy can save you money.