solar power could become cost competitive with natural gas in about a decade – inexplicably
due to the proliferation of inexpensive natural gas, a report says.
like a paradox, but that’s a conclusion of Lux Research, a spin-off of the
venture capital firm Lux Capital, published today in “Cheap Natural
Gas: Fracturing Dreams of a Solar Future.” The report is sunny on solar
power’s future, because the proliferation of inexpensive natural gas could
serve as a bridge fuel that makes a ramp up of renewables possible without requiring
major infrastructure improvements.
help utility-grade solar penetrate the energy mix in multiple regions, it found.
Lux says that solar will reach price parity with natural gas turbines by 2025.
macroeconomic level, a ‘golden age of gas’ can be a bridge to a renewable
future as gas will replace coal until solar becomes cost competitive without
subsidies. On the microeconomic level, solar integrated with natural gas can
lower costs and provide stable output,” said Ed Cahill, the report’s lead
author and research associate.
has made the assumption that there will be a significant drop in the cost of
utility grade solar power systems and barriers to scale gas production through
environmental regulations in Europe and high capital costs in South America.
However, there are currently no
signs of a shale gas production slowdown in the United States, which is now
the world’s largest
producer of natural gas, a major job growth engine.
energy consumption is also surging.
Solar power and wind power usage have grown 267% and 538%, respectively, in
the United States in less than a decade following the “green
revolution” brought on by the American Recovery and Investment Act, which
is better know as the Stimulus. The same transition is happening worldwide: the
International Energy said that renewables would account for a quarter of world
energy production by 2016, in a June report.
There is intermittent penetration.
an entirely seamless transition to renewables like solar power. Lux Research's report noted: “Turmoil is imminent because standalone solar will not yet
be competitive when subsidies start expiring in markets like China, the U.S.
and Japan. Companies will need to diversify geographically and transition to
areas with fewer gas resources – or develop hybrid systems that take advantage
of low gas prices.”
(image credits: Lux Research, Wikipedia Commons)
This post was originally published on Smartplanet.com