- Solar is growing extremely fast in the US.
- That growth is driven almost entirely by pure economics, not environmental concerns.
- The big utilities can’t seem to get either of the above two points through their skulls yet.
- Solar financing is the next political frontier to watch in the US.
Our viewpoint is that Solar is here to stay and very early in the growth cycle in the US.
What is clear to us is that the perception of solar as being inefficient and requiring material subsidies is no longer accurate – a concept that is not being fully appreciated by the utility sector, in our view. As we clearly display in the below sections, Solar is already cheaper than electricity at the plug in many countries, with others very close behind including the US with several states already displaying “socket” or retail parity (i.e. Georgia, Arizona, and New Mexico).
Distributed (DG) or off grid generation at the residential and commercial scale level could be set to take on a greater piece of the solar generation pie. Much of this we attribute to the emergence and expansion of third party financing…
At the same time, the alternatives of conventional fossil fuels are likely to gradually become more expensive (assuming that the ‘lowest hanging fruit’ in terms of reserves are exploited first).
While we expect the same trend in the US [of declining solar costs and rapid growth], we find that many utilities have had issues trying to grapple with this concept.