To distant onlookers, solar might seem like a trend that’s recently caught on, similar to kale smoothies or squad goals. But the technology of solar energy and its accessibility has been steadily improving over decades, leading us to this point in history when new solar installations are expected to jump in the US to a record-breaking 100 GW by 2020.
Imagine 20 million American homes operating on solar power. Imagine solar playing a key role in carbon reduction, as well as improving America’s economy. Thanks to rapid growth within the industry and support from its proponents, this is not a fad nor a distant dream. It’s tomorrow. And the progress we will see in 2016 constitutes one of the biggest leaps forward yet to occur.
Recently, the solar investment tax credit (ITC) was in danger of being reduced to only 10 percent for commercial use and zero percent for residential. This would have meant that one of the major incentives for residents and corporations to go solar—the financial attainability—would have flown out the window. Thankfully, Congress passed a bipartisan bill stipulating that the ITC will remain at 30 percent until 2020. By 2022, it will drop to 10 percent for commercial, and zero for residential. The bill also stipulates that the yearly tax credit applies as long as the construction on the project begins before Dec. 31.
Pro-solar policies at both state and federal levels continue to encourage the industry to expand and ultimately transform America’s economic landscape. The energy revolution is spearheaded by the 174,000 American solar industry workers, a number that is constantly growing and represents the most diverse energy sector in the nation. The passing of the bipartisan bill means this sector will continue to grow and add 220,000 jobs over the next five years, including 50,000 to US military veterans—a higher percentage rate than the total US workforce. The bill will also allow for a 3000 percent increase in total solar capacity over the span of a decade ending in 2020.
This upcoming solar energy progress will offset 100 million metric tons of carbon dioxide emissions by 2021. Electricity production accounts for more than one-third of US global warming emissions. Renewable energy resources like solar cause very few total emissions comparatively, and do not put strain on our water supply. In addition to preserving the earth and its resources, implementing renewable energy on a larger scale will benefit public health, as several serious health conditions are associated with air pollutants that result from traditional energy sources.
New developments in solar technology are constantly making waves. Conversion efficiency and power output are steadily increasing, bridging the gap between cutting-edge research and commercial sustainability. The biggest challenge for manufacturers is producing efficient designs in a cost-effective way so that solar companies can present themselves as viable options to consumers. As photovoltaic cells become more efficient, the price of the actual cells doesn’t dip—but the number of those cells one needs to fulfill energy needs does.
Thanks to growth in the sector and increasing efficiency, solar companies are able to offer better prices to consumers. On top of tax credits and other incentives, retail credits for surplus energy reward solar users and make the investment more appealing. As it stands, the costliest part of installing solar is typically the installation and other soft costs, such as permitting, inspection, connection to the grid, etc.
Since a similar tax credit extension was put in place in 2008, solar prices have fallen consistently. With Congress passing the bill that stabilizes the ITC for a number of years, the industry will have even more of an opportunity to grow rapidly and meet the demands of more and more consumers. As the industry matures and the market experiences great global growth, those beneficial tax credits may reduce, but the production—and therefore consumer costs—will decrease.
Consumers also have the option of leasing, which can be more cost-effective for people who do not qualify for state or federal incentives, and who will be remaining in the same home for the life of the solar system.
What We Will See in 2016
The coming year is going to play an important role in the overall arc of solar energy progress. In 2016, the industry will look to maximize the benefits of the ITC extension, making solar power more and more attainable. This is the year that switching over to solar no longer seems like a moral argument, but the wisest of economic choices. Job growth, better prices, fewer hurdles to public acceptance, and increased efficiency both in production and storage mean the benefits of sustainable energy will become irrefutable.