The International Energy Agency (IEA) recently put out a report stating that solar is now the cheapest form of electricity for utility companies to build. This is primarily due to risk-reducing financial policies worldwide and especially applies to areas with the most favorable policies and the easiest access to financing. The IEA’s report details how imperative these policies are when it comes to encouraging the continued development of renewable energy and other environmentally friendly technologies.

The Report

The International Energy Agency’s report states that solar power is 20% to 50% cheaper than previously thought. The calculation is based on financing figures compared with the amount of output for solar projects. This means that investors are getting better financing deals as panel technology becomes more efficient and prices for basic panels decrease. 

When the report states “20% to 50% cheaper,” it’s referring to companies that are building solar projects, not necessarily something that directly benefits consumers or solar homeowners. However, those figures are still important because one of the main reasons the world has stuck with coal and gas power is that it was more cost-efficient. Until now, anyway. Solar’s cost per megawatt has fallen to the point where it’s almost cheaper than both gas and coal worldwide.

The Reason for Solar Getting Cheaper

Many things can affect the cost of capital. However, when it comes to renewable energy, there are a few notable factors. As people and corporations notice more successful projects, such as Elon Musk’s South Australian solar battery farm, the confidence of investing grows. 

The better the technology works, the more people look forward to utilizing it. The cost of technology is also falling, which means that investors don’t have to take as big of a risk. Then, policies such as tax incentives and low-cost financing are just the cherry on top for investors. 

The Future

The International Energy Agency predicts similar projections for all types of renewable energy, including nuclear energy. However, solar is in the best position to explode in the next decade. Right now is the time that solar energy is cheap and readily available. 

Good News for Consumers and Solar Homeowners

While most of these cost-saving measures benefit corporations that switch to solar, the solar craze is still driving the cost of solar technology down. This is where you can benefit as a consumer or solar homeowner. The cost of solar equipment is at an all-time low, so now is the time to invest in solar panels for your home. With over a decade of experience, Sol-Up is Southern Nevada’s premier solar company. Our professional installers have years of experience and are trained to provide nothing but outstanding quality using only cutting-edge technology with the best warranties in the industry, making sure to get you the best price on the best products. Contact us today for a free quote.

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