I’ve been getting into Solar lately – the fall in prices has been absolutely shocking over the last 2-4 years.
We are seeing price drops closer to 20% per year after several decades at 6% price drops per year.
6% year is a fantastic rate of decreases, but 20% is simply astonishing. 20% is an impressive number, but putting it into context will make your jaw drop with astonishment.
My calculations show that if solar maintains 5 more years at current 23% rates per year price drops, solar power will be cheaper than using existing coal plants. That’s right – it will be cheaper to build new solar plants than to use existing coal plants. It sounds absolutely crazy.
But it seems true looking at the data.
First, look at this paper showing the levelized cost levels for using Coal and Natural gas. In this chart, we can see the Levelized cost of electricity for different types of energy. Photovoltaic Solar has a high initial cost, but after paying for the system, the cost goes to the lowest among any source of energy. Great news, but the initial cost for solar is quite high. It’s high enough to make almost anyone not want to use solar.
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You can see the price drops for every single source of energy drops after 20 years, becau
Robot Fiscal Policy
A few days ago, I complained that Matt Yglesias seemed to be ripping off Monetary Realism posts, or at least riffing on them. selise pointed out perhaps “great minds think alike” and well, I guess it is in the air. I then said he would start writing about automating fiscal policy because we were writing [...]
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