There is more good news on the energy horizon: not only are oil prices falling, but costs for rooftop solar-powered electricity are expected to decline over the next several years, becoming competitive with coal or oil-powered electrical generation.
The prediction is made in a new report from Deutsche Bank, which says solar energy will reach price parity with coal and oil in all 50 states by 2016. Computerworld magazine recently reported on the solar market study, written by Deutsche Bank analyst Vishal Shah. Shah’s report focuses on Vivint Solar, the country’s second-largest installer of solar panels.
With prices of photovoltaic panels coming down thanks to improved economies of scale, lower installation costs and cheaper ways to finance rooftop solar panels on homes and businesses, Shah sees an opportunity for Vivint to double its sales every year over the next two years.
With a perfect storm of lower panel prices, lower finance rates, and a 30 percent federal tax credit for solar investment that is scheduled to expire in 2016, analysts expect to see a surge installations over the next year.
Deutsche Bank found that the in the top 10 states, measured by installed solar capacity, the cost of solar electricity ranges from 11 to 15 cents per kilowatt hour, in many cases easily beating the cost of standard retail electricity, which ranges from 11 to 37 cents per kilowatt hour.
Deutsche said over the next 18 months, prices for solar electricity are expected to drop to 9 to 14 cents per kilowatt hour. The lower costs, as shown in the table below, will spur installations across the country, resulting in price parity with coal or oil-generated electrical power in many more states.