What Could Halt the Growth of the Solar Industry?

The solar industry has experienced massive growth in the last decade. In 2010, the residential installed solar capacity in the US was 667 megawatts, which skyrocketed to almost 20,000 megawatts in 2021.

Job growth has fallen in line with the industry growth. According to the National Solar Jobs Census, the US solar industry has over 230,000 workers as of 2020, compared to 93,000 in 2010.

But despite the growth of the solar industry, it’s not a viable option to replace fossil fuels completely at this time. There are significant challenges facing the industry that are hampering progress.

Grid Infrastructure and Utilities

The power grid has been the same, more or less, for the past hundred years. The American cultural shift to greener energy sources requires a retrofit of the grid infrastructure to manage the influx of renewable energy.

That’s a plan that President Joe Biden is currently working on, including a major power grid overhaul to support more clean energy sources. Unfortunately, that’s a tough barrier to overcome.

To accomplish this, the government will have to completely overhaul an electrical network that runs on thousands of generators owned by about 3,000 different electricity providers. Most of these providers are investor-owned utilities, cooperatives, publicly owned utilities, power marketers, and federal power agencies.

With the revenue at stake, utility companies of all types aren’t taking the change lightly. In just 2019, the US electric power industry generated over $401 billion. The utility providers are feeling the pressure of the shift to renewable energy, however, despite arguments that it would “lay waste” to the US power utilities and its model.

The key here is that electricity can’t be stored. 

Once it’s generated, it’s sent to the grid where it flows through power lines to homes and businesses. If the demand is higher than anticipated, the power may go out or flicker. If the demand is too low, energy is wasted. Utility companies always have to balance this generation and consumption.

With renewable energy involved, that balance becomes much more complicated. But as more people become energy-independent through solar power, the reliance on current utilities will diminish.

Affordability and Efficiency

Like all new technologies, the cost of solar power is cheaper now than it was when it was brand new. Still, it’s an expensive investment. Homeowners may pay between $15,000 and $25,000 for a solar system.

Though it could pay off in lower energy bills moving forward, that’s a high upfront cost for a lot of homeowners. There are rebates to offset the costs, such as:

  • The Residential Clean Energy Credit
  • Power Purchase Agreements

Efficiency is another challenge for the solar industry. Most solar panels from known brands are about 15 to 21% efficiency, so most of the sunlight isn’t captured. This is largely because the solar panels can’t move to meet the direct sun rays.

There are developments in this area, too. The National Renewable Energy Laboratory (NREL) created a device that boasts a record-breaking efficiency of 47.1%. This proves that new technology could produce more energy, making solar a more viable alternative for homeowners.

Looking to the Future

Solar may have some barriers to widespread adoption now, but the walls are coming down. If the evolution continues, solar could become the ideal solution for eco-conscious and financially savvy homeowners. 

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