| Grid parity is defined as the point at which photovoltaic | | | | trends in the solar industry: |
| electricity is equal to or lower than existing electrical | | | | 1. Vertical integration in the supply chain |
| grid prices. It is achieved most quickly in areas that | | | | 2. Power purchase agreements which allow people to |
| have high prices in electricity and high amounts of | | | | lease solar panels and pay a rate lower than their |
| sunlight such as Japan and California. This is the | | | | existing electricity costs. |
| reason why California has been leading the solar | | | | 3. Risks associated with traditional electric companies, |
| energy charge. Grid parity is also readily achievable in | | | | wind manufacturers, and grid operators. |
| areas where the electrical grid power is produced by | | | | Grid parity is also being sped up through the advances |
| expensive fossil fuels such as Hawaii. | | | | in concentrating photovoltaics. Concentrating |
| It is estimated that the majority of the United States | | | | photovoltaics can reach grid pairty as soon as 2011. All |
| will reach grid parity by the year 2015. As long as grid | | | | these technologies will converage to allow consumers |
| electricity prices do not decrease, we expected to | | | | to install solar arrays at a decreased rate with real |
| reach grid parity even before 2015 in sunny parts of | | | | economic benefits. The thing holding back many |
| the United States. This will mean that States will not | | | | homeowners from installing solar at the moment, in |
| have to subsidize solar installations at the cost of | | | | areas that do not have subsidies, is the long payback |
| taxpayers. | | | | periods. If you live in areas with generous tax |
| The full cost of solar electricity is around $0.25/kWh in | | | | incentives, there is no reason not to install a solar |
| most countries. By 2011, it is predicted that the cost will | | | | power system now. |
| drop to $0.15/kWh. This is due to three emerging | | | | |