Should you switch to solar? - Shannon Odell
In the spring of 1954,
the press excitedly gathered around
Bell Laboratories’ latest invention—
a silicon-based solar cell
that could efficiently convert
the sun's energy into electrical current.
The creation was celebrated
as the dawn of a new era,
as reporters touted that civilization
would soon
run on the sun’s limitless energy.
But the dream had a catch,
as this first commercially sold solar cell
cost around $300 per watt,
meaning at its current rate,
it would cost well over a million
to buy a unit large enough
to power a single home.
But today in many countries
solar is the cheapest form
of energy to produce,
surpassing fossil fuel alternatives
like coal and natural gas.
Millions of homes are equipped
with rooftop solar,
with most units paying for themselves
in their first 7 to 12 years
and then generating further savings.
So how did solar become so affordable?
A turning point in solar’s
price history occurred
on the floor of Germany’s parliament,
where in 2000,
Herman Scheer introduced
the Renewable Energy Sources Act.
This legislation laid out a vision
for the country’s energy future
in solar and wind.
It incentivized citizens to personally
invest in rooftop solar panels
by guaranteeing payment to homeowners
for the renewable energy they generated
and sold to the grid.
The pay rate for this electricity was
highly subsidized,
at times reaching four times
the market price.
Several other countries soon
followed Germany’s example,
implementing similar
policies and incentives
to drive their country’s solar use.
This created unprecedented demand
for solar panels worldwide.
Manufacturers were
able to scale up production
and innovate in ways that cut costs.
As a result, solar panel prices dropped,
while efficiency grew.
Today, a 46-square-meter rooftop
solar unit is often efficient enough
to fully power a home,
and this residential unit
no longer costs millions—
in the US in 2022, the average
consumer cost of a rooftop solar unit
ranged from around $17,000 to $23,000.
These prices dropped by over 60%
between 2010 and 2020 alone.
So how much money can you save
by switching to solar?
US solar equipped homeowners
can save around $1,500 per year
on their energy bills,
equating to a net savings of $10,000
to $30,000 during the unit’s lifetime.
Month-to-month savings
tend to vary,
based on the amount of direct sunlight
your panel receives,
weather conditions, and the price
of electricity where you live.
But not everyone can get solar.
Adopting solar can be difficult
for renters, and in many countries,
more than 25% of adults don’t own
their own homes.
Even if you do, your roof must meet
certain orientation and tilt requirements
to make solar a worthwhile investment.
And while units often pay for themselves
through offset energy costs,
the initial purchase and installation
price for solar can be expensive.
But several companies have adopted
solar leasing models,
where they finance the material costs,
installation, and upkeep
of the rooftop systems.
Homeowners can then buy the panel’s
generated electricity
at a fixed rate that’s generally lower
than the local utility’s price.
Still, many are working
towards community-based solutions,
which would enable entire neighborhoods
to profit from solar use.
Europe is home to more than 7,000
community energy associations,
where local members collectively
invest in wind turbines and solar panels
to power their local grid.
In 2005, the German town of Wolfhagen
created an 800 member citizens co-op,
which communally invested $2.84 million
to buy up 25% of the local energy company
and expand its renewables program.
Today, its turbines and panels
generate enough energy
to meet the town’s needs and then some.
Surplus energy is sold
to neighboring towns,
and profits are reinvested
back into the community.
For many, the appeal of solar
goes beyond just savings.
Homes equipped with it are
more climate resilient,
because they can be protected
from utility grid outages and brownouts.
Not to mention solar’s key role
in decarbonizing the energy grid.
By working together with larger-scale
wind and solar farms,
rooftop solar units help reduce
our reliance on fossil fuels,
paving the way for a cleaner
and more reliable energy future.
