In the spring of 1954, the press gathered around Bell Laboratories’ latest invention— a silicon-based solar cell that could efficiently convert the sun’s energy into electrical current— and celebrated it as the dawn of a new era. Although the cell was expensive, costing around $300 per watt, today in many countries solar is the cheapest form of energy to produce, surpassing fossil fuel alternatives like coal and natural gas. Millions of homes are now equipped with rooftop solar, with most units paying for themselves in their first 7 to 12 years and then generating further savings.
A turning point in solar’s price history occurred in 2000, when Herman Scheer introduced the Renewable Energy Sources Act in Germany’s parliament. This legislation incentivized citizens to invest in rooftop solar panels by guaranteeing payment to homeowners for the renewable energy they generated and sold to the grid. Several other countries followed Germany’s example, leading to unprecedented demand for solar panels worldwide. This allowed manufacturers to scale up production and innovate in ways that cut costs, resulting in a 60% drop in solar panel prices between 2010 and 2020.
Today, US solar equipped homeowners can save around $1,500 per year on their energy bills, equating to a net savings of $10,000 to $30,000 during the unit’s lifetime. However, not everyone can get solar. Adopting solar can be difficult for renters, and in many countries, more than 25% of adults don’t own their own homes. Additionally, the initial purchase and installation price for solar can be expensive. To combat this, several companies have adopted solar leasing models, where they finance the material costs, installation, and upkeep of the rooftop systems.
Europe is also home to more than 7,000 community energy associations, which allow local members to collectively invest in wind turbines and solar panels to power their local grid. In 2005, the German town of Wolfhagen created an 800 member citizens co-op, which communally invested $2.84 million to buy up 25% of the local energy company and expand its renewables program. Today, its turbines and panels generate enough energy to meet the town’s needs and then some.
For many, the appeal of solar goes beyond just savings. Homes equipped with it are more climate resilient, because they can be protected from utility grid outages and brownouts. Solar plays a critical part in transitioning the energy grid to a low-carbon state. Collaborating with larger wind and solar farms, rooftop solar systems are able to diminish our dependence on fossil fuels and create a more dependable and environmentally friendly energy future.