Solar Is Beating Fossil Fuels
Sometimes it gets a little frustrating to hear opponents of solar energy say continuously that sustainable energy is not ready to be competitive with fossil fuels to deliver all the power our country requires. Well, I know that the solar sector is expanding enormously year after year and that fossil fuels keep on being eliminated.
The solar industry has long ago left behind the cottage industry mentality it had decades ago. Spectacular developments in production technology and funding have helped bring the solar industry to the playing field with coal, oil, natural gas, and nuclear power. Here are some reasons why solar is already succeeding in beating fossil fuels.
In the United States, there are more people employed to create solar energy than there are working in the coal mining industry. The ridiculous argument that shifting to a sustainable energy economy will end up costing jobs is incorrect. Solar is developing over 10 times more rapidly than the U.S. economy. Solar added in 18,000 new jobs in 2016, and this is up 39 percent from 2012. This year, and also in 2018, the solar industry will create another 28,000 jobs, whereas the fossil fuels industry cut 9,000 jobs in 2016.
Fact is that Germany, during their recent solar boom, doubled the country’s solar workforce to more than 400,000. The most significant argument is that renewable energy is far more job-dense than traditional energy. So even when solar power can be obtained at the same price, solar will win because it will generate more jobs than fossil fuels. When it relates to employing Americans, solar is the winner.
During the last few decades, we have seen a consistent drop in prices of solar panels, especially in the last few years that drop has been dramatic. Over the past 30 years, the price of solar panels has dropped from $77 per watt to around $.75 per watt. You see that solar has become 99 percent cheaper than it was some thirty years ago. At the same time, since 2008, the cost of coal has gone up by 13 percent. There are parts of the market where the price of solar has already reached equality with the price of coal. For sure you’ve heard the controversy that solar can only be economically efficient because it is relying on government subsidies. At the moment this may very well be true, but when the price for solar reaches the general prediction of $.25 per watt by 2020, subsidies may well not be needed anymore.
On top of that comes the obvious fact that oil, gas, and coal obtain subsidies that make those for renewables look like almost non-existent. And then we don’t even consider the extra costs that the burning of fossil fuels imposes on society, and these costs, labeled ‘externalities’ by economists, are not paid by fossil fuel companies. Research by Harvard Medical School indicates that the damage to the environment and human health costs $500 billion. In case those extra costs were taxed back onto fossil coal power plants, the price tag of coal would more than double, and then we do not even take the whole climate change issue into consideration. So the discussion about price and economic viability is really a non-discussion.
Due to the fact that the cost of solar has dropped rapidly, the number of installations is escalating at an exciting rate. This year, the United States became the fourth country to reach 10 GigaWatt of solar energy capacity, and solar installations have increased at a rate of 50 percent each year for the last five years. Expectations are that this year, that rate will increase to 80 percent, and we can see that 65 percent of the global solar capacity has been installed during the past two years.
In comparison, during the coming five years, 175 coal-run power plants are expected to close in the U.S., this is more than ten percent of the total capacity. This demonstrates the increasing costs of coal and the implementation of more stringent environmental restrictions.
For investment firms, fossil fuels have been an omnipresent component of their portfolios for decades, but we can notice that their reign may soon end. Not too long ago, several reports have indicated that a carbon bubble might be approaching. Big Oil and Gas is valued in the market according to their reserves of unburned fuel in the ground, they are valued by their potential. But in case international regulations become effective that atmospheric CO2 levels cannot rise above 450 ppm, the anticipated cap to steer clear of irreparable climate change, a good deal of the stated reserves could never be burned for fuel. This implies that momentarily many fossil fuel corporations are overvalued because they probably possess massive unburnable reserves of fuel.
HSBC, the big British bank, anticipates that as soon as more stringent climate restrictions become effective, the value of traditional energy companies may fall dramatically. Over the past five years, the market cap of coal companies has already fallen in value by more than 75 percent. Companies like Mercer and WHEB are suggesting investors to move out of coal and oil and turn to renewables, and key investors are already moving that way. Warren Buffett invested $5.4 billion in solar energy and he has also predicted the end of coal as a power source in America. If you are a college graduate and want to specialize in sustainability check out:
Does this need any explanation?