The overall perception that solar power is more costly despite all the benefits is about to change. After fighting an uphill battle against natural gas prices, solar power is on the rebound.  Reports now indicate that solar electricity use is expected to climb significantly.  Some experts in the know now estimate that the costs associated with solar will soon be on par or even lower on average electricity bills in 47 U.S. states by the year 2016.

Furthermore, even if tax credits are eliminated or reduced to some degree, solar power is still primed to make a push- through and reach price parity with conventional electricity in most states in the not so distant future. Leading reports show Solar is no longer just something exotic for the wealthier, earth-conscious set. It is rapidly becoming mainstream as more people begin recognizing the many benefits of going solar. Also helping in the equation and driving the expected resurgence are the lower costs associated with rapidly improving technology used in the development and delivery of solar energy.

Grid Parity will top 36 States in 2016.

Just recently, solar power has reached grid parity in the top ten states that generate more than 90 percent of all solar electricity production in the U.S.  Installed capacity in those states alone will continue to grow with some analysts estimating increases at rates of six times as much over the next 3 to 4 years.

The U.S. has largely left the solar panel manufacturing business,” said Michael Didriksen, an energy transaction-focused partner at law firm Baker Botts in New York. “We have exited that business with the exception of thin film panels. So, we’re protecting an industry that doesn’t have a lot of manufacturing, and I don’t know if this tariff provides enough incentive for investment to change that.

The incentives produced by tariffs have not been historically great.

After George W. Bush imposed steel import tariffs in 2002, ranging from 8% to 30%, the result was the loss of about 200,000 jobs for the 21 months the tariff was in effect, according to Matthew West, Baker Botts’ global projects chair and trade partner. It was repealed after an adverse decision by the World Trade Organization.

The big reason for such a shift in the solar dynamic with never before seen dominance is that solar energy is and always will be a technology and not a fuel. Because of this critical distinction, as the efficiency of solar technology improves over time, prices will inevitably fall.  Just the opposite is true with the price of the earth’s limited resources of fossil fuel.

Historically, energy prices have steadily climbed since the late 1940s.  And while solar power costs also climbed as the developing technology was first implemented, it will now for the first time undercut even the cheapest fossil fuels in many regions across the globe.  This is also true in many of the world’s poorest countries where multi-billion-dollar coal plants are no longer a logical solution to a growing population’s increased energy demands.

Soon, relatively speaking, solar power will be the world’s largest source of electricity.  Some estimate this will occur by the year 2050.  That is a far cry from existing solar use which accounts for just a fraction of one percent of the world’s electricity production.

Because of solar power’s minimal market share today, regardless of how fast capacity increases, it won’t have a dramatic effect on the price of other forms of energy.  However, for the first time, forecasters can see a situation where gas and coal prices will eventually lose their dominance over the solar industry.

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