My position has always been deliriously pro-environmentalist, however, for the sake of getting a comprehensive look at what policies have been effective, and what trends are prevalent, I have conducted research examining both sides of the coin. In this article, I will describe the evolution and implementation of solar technology, what it will bode for our future, and whether it will waste our money and time. Lastly, I will discuss the economic, cultural, and political implications of PV.
To begin, photovoltaics (or solar technology - PV) is the wave of the
future. This is nearly indisputable. I say this with confidence
firstly because I have been cataloging PV advancement for over 3 years,
in concert with biotechnology, nanotechnology and optics publications.
Ray Kurzweil, the prominent inventor, writer, and futurist, proposes
the Law of Accelerating Returns, which simply states that complex
systems which are governed by the flow of information evolve
exponentially. This law applies to the full range of the universe's
properties, from the Big Bang's physical laws to the Cambrian explosion
of biological diversity, to Moore's Law (doubling of computer power.)
For more details, visit KurzweilAI.net. The (LAR - law of accerating
returns) applies to several technologies which are involved in PV
research, including but not limited to optics, nanotechnology,
biotechnology and theoretical physics.
basics are this: Take the output of oil and natural gas, combined with
incremental efficiency increases and compare it to future projected
solar power efficiency based on the LAR. When we reach a point where
solar power overtakes the traditional power methods of the grid, it is
called "grid parity." There are already several places which have surpassed grid parity, as described in a publication out of Queen's University, Canada, writing:
"Grid parity is considered when the LCOE of solar PV is comparable with
grid electrical prices of conventional technologies and is the industry
target for cost-effectiveness. Given the state of the art in the
technology and favorable financing terms it is clear that PV has already
obtained grid parity in specific locations and as installed costs
continue to decline, grid electricity prices continue to escalate, and
industry experience increases, PV will become an increasingly
economically advantageous source of electricity over expanding
Grid parity has been achieved in a number of locations, including in California, Italy, China,and even some parts of India, which previously employed diesel generators.
I will post a few graphs here for the benefit of a visual depiction of how the market has been evolving:
(A graph from KurzweilAI.net detailing solar grwoth per megawatt)
The study at Queen's university also shows that solar efficiency dropped in North America from around $7.5 per watt in 2008 to a minimum of $3.9 per watt last year, give or take some outliers. During that time, the field saw advances in self-organizing crystalline technology, as well as thin-film PV and biological substrates. Additionally, manufacturing innovation in China vastly reduced the cost of solar panels. The report from Queen's University details that:
"From 2000 to 2010, global solar PV deployment has increased from 0.26
GW to 16.1 GW1  with an annual growth rate of more than 40% [3, 9-11], due to both
technological innovations that have reduced manufacturing costs by 100 times and various
government incentives for consumers and producers [3, 4, 11-15]."
In fact, China is currently overproducing solar cells, despite having lost market share and dropped in profits during the second quarter of 2012 (Trina Solar). This continual overproduction (in my opinion) is a move to get a larger piece of the PV pie, while squeezing small start-ups out of the race, whose infrastructures are not as vast, and not facilitated in part by cheap labor standards and governmental aid. China currently holds nearly two-thirds of the market share for PV, according to an article published in the New York Times.
Now, the US has made a drastic move to stop the growth of China's solar industry, imposing a tariff on imported solar panels which can reach as high as 36%. Despite this, however, US solar panel installation in 2012 surpassed the total sum of all installations from 2000-2010. Although this is a xenophobic move in a manner, and perhaps a little dangerous, to poke the bear who holds your metaphorical nuts (US bonds). Still, this won't halt China's ascent, as they have filed complaints with the WTO against Europe and the US. My personal feelings on this are that China is justified in doing so. During the multinational boom of foreign US interests, WTO and other such organizations were highly beneficial to American companies such as the IMF and world bank, not to mention the myriad of American multinationals that spawned afterwards.
All things considered, both parties are at fault, as short-term violations of international trade policies weaken relations and destabilize markets. Each of the parties needs to come to an agreement that will result in cohesive international trade. This decision comes in the wake of an investigation launched by the EU for "antidumping" practices from China. Dumping in economics refers to intentional price control of goods (making them cheaper in another country than in your own, flooding markets with unexplained surplus of goods). Additionally, the report "A Review of Solar Photovoltaic Levelized Cost of Electricity," details how
"[t]he private sector favours higher discount rates to maximize short term profit, but these may be too high to capture the benefits of long term social endeavours undertaken in the public sector, such as infrastructure and energy projects ... Solar manufacturing prices have been rapidly
declining with economies of scale through turn-key manufacturing facilities and industrial
symbiosis [68, 70, 71]...
So what is the solution? The trend seems to be that subsidies do not have a profound impact. They have been abolished in the US, Germany, and the UK. Despite that there were massive increases in implementation of PV, however, there is an asymmetry in the transition from traditional grid infrastructure, not to mention the meteoric cost to governments.
The problem with solar implementation isn't with subsidies, it's with investment infrastructure. Governments need to have forums of some kind, investment branches where bright-eyed graduate students and ambitious innovators can pitch their ideas to both private and governmental investers. These panels should have oversight, and should be highly integrated with academic and industrial sectors, to both anticipate and implement emerging technological change.
Now, for the implications:
The world population is growing. Not only that, as developing countries emerge into the Western sphere, their energy consumption jumps with their GDP. This is being seen en masse in China, as internet penetration and the automobile industry begin to boom there. India is another top contender for most energy consumed, also another emerging country.
How does one meet an exponentially increasing demand? With exponential supply. This is why solar is slated as a big boy in the playground. Diffusion of PV will affect energy markets drastically in the next 10 years.
This may sound far fetched, but PV is a democratizing force. People will not only be completely independent of the grid, but they can, if they choose to, sell some of that electricy via a contract with their respective governments over time. In Ontario, Canada, for example, the MicroFit program provides static pricing for consumers selling their power to the government. They have even fixed the rate for inflation.
What we will see at first, with the decentralization of energy, is less dependance on centralized institutions and government. This, in addition with the vast quantities of information at the ready on the web may provide a catalyst for deep social change.
The implications have already begun here. China, the EU, and America are all vying for the top spot in PV manufacturing. There has definitely been some foul play, and I doubt I have found all the evidence. I would suspect that special interests are breathing down Obama's neck to keep natural gas flowing, and to keep solar panels nice and expensive. Let's not have that massive natural gas or biofuel infrastructure become useless in 5 years hmm? That would be/is embarrassing. I foresee a sort of arms race. China is in the lead. Wait for the results of the WTO investigation, and we will see who comes out on top.. Maybe China will just call in the US debts and claim montana as retribution for their insolence. Doubtful, as America is surely still their primary export partner.
In sum, PV is the wave of the future. Don't let policymakers fuck it up with ham-handed subsidies that are inefficient. Especially don't allow large oil and gas companies to gain a foothold in the important forums and circles (they are already there). My last advice is actually TO the oil companies: Diversify your portfolio. If you want to do business in energy, vertically integrate - find a small startup and merge. Wean off of oil - it's expensive to harvest and move around, and it's far less efficient than solar will be in less than a couple of years. Additionally, mr. Oil company man who is definitely not reading this, do not try to stem the flow of PV, because masses will find out, will get pissed off, and will crush you.