Solar Socket Parity Has Shifted Solar Forecasts (CHARTS)

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One graph in the International Energy Agency’s latest Solar Roadmap report highlights how the dramatic cost reductions in rooftop solar PV has caught the world by surprise – and caused the likes of the IEA to revisit their forecasts, and for incumbent industries to review their business models.

Four years ago, when the IEA did its last major Solar Roadmap report, socket parity (where the cost of rooftop solar is competitive with electricity from the grid) was just a distant dream – or so it seemed.

As this chart below shows, in 2010 the LCOE of rooftop solar (indicated in blue) was far above the variable rates of grid-based electricity. But in just three years, the LCOE (now in green) had caught up.

iea socket parityIt is for this reason that the IEA has had to double its forecast installation of solar PV over coming decades. Most of this is due to “socket parity”, where the IEA says rooftop solar is “unbeatable” by other technologies. It says rooftop solar will account for half of all solar PV installations out to 2050.

Some analysts think that the IEA is still being conservative, and may have to raise its forecasts again. But the stationary energy industry is not the only one to feel the pinch from the plunging price of solar PV, which has fallen around 60 per cent in the last three years.

This graph, which we have published before, and which its authors, the US investment firm Alliance Bernstein, dubbed the “terror dome,” shows the comparative trajectories of solar PV and liquid fuels, previously considered untouchable by solar.

The realisation that solar PV was now in a position to displace diesel fuel in some countries, oil in others, LNG in Asia, and gas in many developed countries, raised the prospect of energy deflation some time down the track. It may come in a decade, when investors realise that the money invested in more expensive oil and gas extraction might become stranded. That will precipitate a massive shift in capital – a long time before the deflation actually occurs.

bernstein solar

Source: RenewEconomy. Reprinted with permission.

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Giles Parkinson

is the founding editor of, an Australian-based website that provides news and analysis on cleantech, carbon, and climate issues. Giles is based in Sydney and is watching the (slow, but quickening) transformation of Australia's energy grid with great interest.

Giles Parkinson has 596 posts and counting. See all posts by Giles Parkinson

21 thoughts on “Solar Socket Parity Has Shifted Solar Forecasts (CHARTS)

  • Yawn. When will these corporations start reading Clean technica, so they can find out what this gang of prophets have been saying for years.

  • Does anyone know the potential cost decrease for rooftop solar if it was integrated as part of the roof on a regular basis? Potentially it could cost less than utility scale as the support material is already there and the roof is needed anyway.

    • Yes. I’ve also wondered this: In the case of a house designed ground-up for rooftop solar it would be possible to to completely cover any south facing roof. Theoretically this would significantly prolong the life cycle of any underlying shingling or other roofing material and decrease long term costs.

      • I’ll throw in my idea one more time.

        Create a complete roof package in which the panels attach to the trusses/rafters and serve as the entire roof. Use a racking system that provides for a weatherproof seal between panels but lets individual panels be removable/replaceable.

        Offer components including skylights and roof doors that can be included in the roof. Make an easy to walk outer edge component to meet fire department requirements.

        That would make for a 100+ year roof and put all the connections inside the building shell, protecting them from the elements and making for easy access.

        Not only south-facing but also east- and west-facing. Panels facing east and west produce about 80% as much power as south-facing. But they extend the solar day and extending the solar day into the late afternoon peak has high value.

        • I wonder who would do such a thing, I think Solar City etc already has their hands full/booked up. Building companies don’t seem to be doing this as far as I know.

        • My guess is that the market has not felt big enough yet for someone to to invest in this. For so many players this would be a complete change in the way of thinking about a roof. A real missionary sales job, to zoning, roof installers, .., before you even get to the home owner. It is a nice idea.

        • Not only East and West but North!! I have two installations that include North facing panels. On a 5/12 pitch, about 35 degrees, North panels make about 66% as much on a year round basis as South facing panels at 44 degrees latitude.

          • Do you know any site that gives irradiance figures for north facing panels? The Solar Handbook doesn’t cover north.

          • I use the website PV Watts. It explains well how to enter the info for a good estimate. It is usually within 5% of actual output for the systems I install.

          • Sorry for the late reply. Try checking out the website “pvwatts”

        • Such interlocking solar panel/tiles might benefit from thin edges designed like clay roofing tiles with the concave side of one panel interlocking with the convex side of the next. Perhaps even a kit with which to retrofit existing panels. Could be an interesting problem for a design engineer.

          • They could install like standing ridge steel roofing where one edge is a flange with screw holes and the edge of the mating panel snaps down over to create a water tight seal.

            Frame the roof with attic trusses so that it would be easy to access the bottom side of the panels for wiring.

            Gable end vent fans could keep panels cooler than they would be mounted over a roof with only passive air flow under.

            And an opening skylight or roof door could make it convenient to clean or remove snow.

          • Attic trusses. Disqus is having problems with images lately.

    • I don’t know about costs, but I realized quite a while ago that the current practice of setting up panels on roofs is, for the most part, a temporary situation, due only to the need to retrofit them into existing buildings. As point-of-use solar becomes more and more affordable and commonplace, more and more new buildings are going to be designed from the outset with built-in systems. I predict that in the next few decades there will be a huge wave of architectural innovation and creativity in integrated solar systems.

  • Giles, I think it will happen faster then anyone thinks, PV will start becoming a thing and people will do it to show they are hip.

    aside from the Koch Brothers hiring tea baggers to shoot out solar arrays it’s unstoppable.

  • The investors are already getting nervous. They may not read CleanTechnica, but they do read reports from the IEA, Citi. Deutsche and UBS. All of these are telling them that solar is winning and will displace oil and gas without any further assistance from policy. Businesses perceived as risky have to pay more for capital, so their investments shrink. A slow senescence rather than a death spiral.

    The displacement of coal does require an assist from policy, as it’s inherently cheaper and more plentiful. But the policy shifts are mostly in place, in the USA, Europe and China, driven as much by the astronomical health costs – in market $ not theoretical externality prices – as by climate disruption.

    • Coal is only “inherently cheaper” because most its cost is externalized. If even have the external cost from the last study in USA was add ($0.3-$0.5Trillion/year US along) The switch to renewable and storage would be a made rush. Charge the CO2 cost, refund all to individuals and offer 1% loans for DG (include community PV/wind) there would be a mad rush. Drop the China PV trade war it is a waste. The funds for the 1% loan could come from the FED buying 0.75% bonds instead of corp bonds.

      • Yes on the externalities. On a proper accounting, coal is as unaffordable as space microwave stations.

  • I still believe these pie in the sky projections are just a little to hard to believe. Of course these techie sites will tout their progress but I see fossil fuels being the number one energy source for at least 75 years.

    • I can understand finding the projections a bit hard to believe if one hasn’t been watching the development of clean energy closely.

      I’ve been tracking both the technology and cost of implementing for some time and find it extremely difficult to believe that fossil fuels will be a major energy source 40 years from now. On my optimistic days I see fossil fuels playing only a minor roll much sooner.

      Keep your eye on how much installation rates for wind and solar grow over the next couple of years and I suspect you’ll see your estimation take a hard shift.

  • it is not—– might become stranded—– it is —–will be lost without a doubt—–
    not in the future, happening now. see stock history of German utilities.

    and the Solar price has fallen 60 percent, do not know what that means for real.
    Google Alibaba and find the actual price of Solar panels. will be about
    0,50 dollarcents a Kwh

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