What are solar incentives?
There are many reasons for developing and deploying solar energy while fossil fuels still dominate the global economy’s energy balance — solar incentives.
Its ubiquity and sustainability mean that it is among the most secure sources of energy available to any country, even in comparison to other renewable sources of energy.
It is also one of the least polluting. Along with other renewables, it can drastically reduce energy-related GHG emissions in the next few decades to help limit climate change.
Other important solar incentives are the desires of people, cities and regions to be less dependent on remote providers of energy and to hedge against fossil-fuel price volatility. Fossil resources are finite.
However, it is difficult to predict when their scarcity will by itself raise their prices so high that most alternatives would become less costly in the current state of technologies.
Except for the original continental-US “peak oil” prediction by King Hubbert in 1956, all global forecasts have been proven wrong – so far.
Oil shocks have been followed by gluts, high prices by low prices. The ratio between proven oil reserves and current production has constantly improved, from 20 years in 1948 to 46 years in 2010.
However, to maintain this record in the decades to come, oil will need to be produced in ever more extreme environments, such as ultra-deep water and the arctic, using more sophisticated and expensive unconventional technologies, very likely keeping costs above USD 60 per barrel, which is twice the average level fewer than ten years ago.
While short term fluctuations in supply and demand and low price elasticity mean that spot prices will continue to gyrate, rising average prices are inevitable. The era of cheap oil seems over.
Furthermore, price volatility raises valid concerns, as does a hefty dependence on too few producing countries.
The availability of natural gas has recently been augmented by shale gas exploitation, and there are huge and wide-spread coal reserves available to generate electricity. At less than USD 100/bbl, gas and coal can also be transformed into liquid fuels.
But there are well known environmental concerns with the extraction and processing of both these fuels and CO2 emissions associated with the manufacture of liquids from coal are even larger than those associated with their burning, unless captured at manufacturing plant level and stored in the ground.
The atmosphere has been subject to a considerable increase in concentration of the trace gases that are transparent to light and opaque to heat radiations, therefore increasing the greenhouse effect that keeps the earth warm.
The climate change issue is plagued with many uncertainties, but these concern the pace and amplitude of man-made increased greenhouse effect, not its reality.
Solar Incentives? An abundance of free, cheap energy, healthier and cleaner earth in which to live.