What made solar panels so cheap? Thank government policy.
We know how to make clean energy cheap. We’ve done it.
Posted By: David Roberts Updated Nov 20, 2018, 3:14pm EST
From an economic perspective, the core challenge of climate change is that the standard way of doing things — the dirty, carbon-intensive way — is typically cheaper than newer, lower-carbon alternatives.
Solving the problem means driving down the cost of those alternatives. Simple, right?
But in practice, it’s not so simple. In fact, we still don’t have a very good grasp on exactly what drives technological innovation and improvement. Is it basic scientific research? Early-stage R&D? Learning by doing? Economies of scale?
If we want to make clean technologies cheaper, we need a better understanding of how the process works. Among other things, Silicon Valley types are spending billions on “moon-shot” start-up initiatives — it would be nice if that money were spent effectively.
There is a voluminous academic literature on these subjects, but a new paper in the journal Energy Policy helps to cut through the fog. It focuses on one specific technology and seeks to identify, and quantify, the various forces that drove down costs.
That technology: good old solar photovoltaic (PV) panels, which have declined in cost by around 99 percent over recent decades.
The authors are MIT associate professor Jessika Trancik, postdoc Goksin Kavlak, and research scientist James McNerney. They are part of a team that, working with the Department of Energy’s Solar Energy Evolution and Diffusion Studies (SEEDS) program, is attempting to develop an overarching theory of technology innovation, using solar PV as its focus.
“Evaluating the Causes of Photovoltaics Cost Reduction” lays out the results — what caused PV costs to decline so fast, and when.
The details are worth examining, but the big lesson is pretty simple: It didn’t just happen. It was driven, at every stage, by smart public policy.
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