Currently, solar power costs are falling faster than ever expected. The plunge in solar panel prices has already brought down some manufacturers from the US and Germany, because they relied too much on subsidies.
The recent plunge in prices for photovoltaic components intensified the fierce competition from China. Now prices for solar are alsmost as cheap as conventional energy systems.
The biggest photovoltaic market is Germany with 24,000 mega watts of installed capacity. The boom in Germany has helped to drive down costs worldwide. Solar is now a viable and accessable alternative to fossil fuel in the Middle East and North Africa as well as in other parts of the world.
Nevertheless, the fall in the prices hit some manufacturers in this sector quite hard. An adviser to the German government and the European Union on climate change and energy security considers that this trend is a positve thing. The previous critics are ignorant, he argues.
During the last five years the prices for solar components in Germany halved. Subsidies will disappear in the near future. Germany has added 14.000 megawatts during the last two years and has already 10 times more installed capacity than the US. Noting that solar power is the worlds most abundance source of energy, the solar sector growth in Germany is still incredible. However, compared to conventional energy, solar power is still quite expensive in Germany. In 2000 the country introduced the Renewable Energy Act, unfortunatly with modest ambitions.
Consequently there are less and less subsidies needed. Now it is about the survival of the fittest/smartest etc.