In the face of global warming and environmental protection issues, renewable energy has become one of the leading solutions to this persisting issue. However, despite the environmental benefits that renewable energy such as solar energy has to offer, fossil fuels still remain the main source of energy in most countries around the world. Although this is still true, a trend towards the use renewable energy has increased rapidly in recent years due to lower production costs, increased efficiency and higher return on investments. These financial and productivity advantages, along with the environmental benefits that it offers, allow for a faster rate of acceptance for solar energy and renewable energy as a whole in the electricity production field.
Increased Efficiency in Manufacturing and Usage of Solar Energy
With more than $6 billion of investment put onto the renewable energy production in the U.S. in the past year, it is to be expected that more and more studies and research are being done to significantly improve the efficiency of solar panels without affecting its production or installation costs. Back when the first silicon solar panels were first invented, its efficiency was at about 6%. However, over the years, manufacturers are able to make solar panels that are up to 30% efficient while reducing their production costs and market price. Researchers at MIT and Masdar Institute of Science and Technology are currently developing a new kind of solar cell that uses two different layers of sunlight absorbing material. This new type of solar cell can reach up to 35% efficiency in practice while keeping the production costs relatively low by the use of a newer, low-cost manufacturing process. As more and more research are made for solar panel efficiency, more and more household starts to see the advantages of having a solar-powered home.
Lower Production Costs of Solar Energy
According to a National Geographic, the price of U.S. solar power has dropped by 70% since 2009. Due to significant improvements in the solar panel manufacturing process and the increased in efficiency in installing these panels, the price of solar has dropped to under $3.50/Watt. And with all the government subsidies and federal tax credits for solar energy, more and more homeowners are resorting to solar as the main electricity producer for their homes. This significant price drop is largely thanks to the increased efficiency in the manufacturing, installation, and performance of solar panels, which leads to a lower production cost for solar energy. In recent years, it’s become less and less expensive to produce solar power in the United States. With the technology being continuously developed and more investment put into developing the efficiency of the production of solar energy, it is expected that the price of solar energy and its production costs will continue to drop, and that to a level lower than the price of fossil fuels.
In the United States, the high operational costs of a coal plant have made the use of coal as energy source to be less economical than solar energy, not to mention the environmental benefits that solar has to offer too. As more investments are made on renewable energy than fossil fuels, the quality and the number of jobs created in research and innovative development in the solar industry surpasses those for the fossil fuels by a large margin too.
Higher Return on Investment for Solar Energy
With rising solar cell conversion efficiencies, expanding production bases, and better supply chain, the rate of return on money invested has continuously increased over the years. Installation of a solar photovoltaic system in a home may have higher initial costs. However, with the lower utility bills, long life cycle of the solar panel system, and possibility to sell electricity surplus to utility companies make solar energy a smart, economic investment for homeowners. The average payback period on investments on solar panel systems is 7.5 years, and homeowners are typically able to save $2500 annually on utility bills with a photovoltaic system.
With increased efficiencies in production and usage, lower costs, and higher return on investment, it’s no surprise that solar energy is becoming a more and more accepted method of energy production. With this market continuously growing, solar energy offers more and more advantages over fossil fuels, and the incentive to go solar is equally growing.