The Political Economy of Solar Energy
AbstractAt the present time, solar power is not a competitive fuel for supplying electricity to the grid in the United States. However, an economic model developed by the U.S. National Renewable Energy Laboratory (NREL) forecasts that solar power production costs could drop twenty percent every time output doubles. Commercial demand for solar cells in the United States has been increasing at a rate of twenty-five percent a year. Such cost projections, if accurate, imply that solar power could be a competitive source of power to the U.S. grid by 2010. Eventually, technical progress and falling production costs will render solar power an important source of energy in the future. As technology improves, it may be possible to supply a substantial part of the nation with solar power from sites in the Southwest of the United States and Mexico. Scientists believe that the cost of solar power will drop to the neighborhood of two cents a kilowatt-hour or perhaps even one cent per kilowatt-hour. If there is enough foresight to develop the technology, then solar-derived hydrogen could become a competitive feedstock in petrochemicals. However, if there is no leadership from government, this process of change could take fifty years. With proper leadership, it could be realized in less than ten to fifteen years.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 22420.
Date of creation: 2005
Date of revision:
Solar energy; photovoltaics; learning by doing; political economy.;
Other versions of this item:
- Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
- L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
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