The entire solar industry is set to emerge as the biggest producer of global energy by 2050. The industry has gone through more than a decade of uncertainty due in part by shifting government programs and changes in the prices of fuel.
The investment tax benefits for alternative-energy enabled the solar energy sector to flourish in the U.S. in 2015 but slowed down after the extension of the tax benefits to 2017 was announced as the urgency to sign deals was lost.
In the early part of the century, Germany’s solar subsidies supported the industry in Europe which then suffered ass the subsidies ended. Early in 2016, the blossoming solar industry in Asia also experienced a slowdown.
The falling prices of solar panels have hurt the front runners in the industry as they try to recover their losses through restructuring and introduce more cost efficient models.
The short-term market collapse does not appear to be a sign of the solar industry’s long-term survival. Recent developments have enabled the industry to be independent of subsidies and solar energy is now cost-competitive with traditional energy.
Current solar energy contracts can compete with fossil fuel contracts and don’t need to rely on artificial stimulants to encourage take up.
Some countries now choose solar over traditional energy sources. In the case of Mexico when the country auctioned for new electricity sources, solar energy providers won the bid to provide almost three-quarters of the needed capacity while wind energy providers will supply almost all of the remainder. The same auctions have taken place in three Latin American countries will result in the increasing number of power plants over the next two years and reflect a long-term demand for new energy.
A steady demand for solar energy is also being fueled by the general sentiment that the sector is the leading component of renewable energy. Even with the suspicion of the Trump administration towards climate change, a global transition away from traditional energy sources is continuously gaining momentum to combat declining fossil fuels and to mitigate if not to counteract the effects of climate change.