The post is a re-post from another site, and it has been re-posted in many other places since. This message goes out to all who are propagating the image in this post.
The core argument of this piece is that solar energy is cheaper than coal if we give it equivalent subsidies. As of October 2010, this claim is definitely incorrect.
To start with, coal is currently cheaper in the United States than solar power is. If you don’t believe me then read about it at:
- U.S. Energy Information Administration. 2016 Levelized Cost of New Generation Resources from the Annual Energy Outlook 2010.
- California Energy Commission. Comparative costs of California Central Station Electricity Generation Technologies.
- Wikipedia has a nice summary of the major studies: Cost of electricity by source.
Direct solar electricity is currently more expensive than coal. That is a fact.
The post also claims that coal could not have competed in the past with wood, steam (which is not an energy source) or watermills as energy sources without subsidies. This is incorrect as well, and can be evidenced by the fact that coal handily outperforms biomass (which includes wood) and hydroelectricity (which includes watermills) in many areas of the world. The fact that coal produces around 40% of the world’s electricity is not an accident.1 It is really cheap to burn flammable dirt.
This post even goes so far as to claim that investment in solar energy will bring the cost of electricity down. I have no clue where they got that idea, but they are again wrong. Since solar costs more than coal, replacing coal with solar means we would be paying more money one way or another.
We believe that misrepresenting these facts is misleading people. If we are to have a meaningful public discourse on this subject, we can’t be hand-waving conclusions that are counter factual. Solar shows great potential, as do many forms of renewable energy. We have written a overview of the potential of renewable energy sources.
What is the real answer?
Coal prices currently do not reflect its true cost. This is because there are large environmental and health effects due to coal. If these costs are legislated to be paid by the coal industry, it will raise the price of coal. This would close some of the current gap in price, but it would not make coal more expensive than solar today.
If you read the sites above discussing the cost of power resources, you will actually see that there is some distinct effort to estimate the total cost of coal power by internalizing some of its harm on the environment. These reports still estimate that solar energy is more expensive than coal.
Coal prices are on the rise. Most of the ideal locations have been used. New coal power plants are more expensive than they have been historically. This trend is expected to continue as we begin to consider development of coal that is harder to access or of a lower quality.
Coal will enter a “terminal production decline” in approximately 20 years, not due to a lack of supply, but because of gradually increasing coal costs and the steadily declining cost of alternatives. The coal age will not end due to a lack of coal.
Additionally, more stringent environmental regulations increase the cost of coal power by requiring investments in emissions reduction equipment. A carbon tax would go even further to bring the cost of coal more in line with the true costs.
Solar photovoltaics are developing rapidly, and show great potential as part of a power grid. We discuss this in detail in our article on solar power from photovoltaic panels.
Solar thermal power, a less well-known technology, shows tremendous potential. This power source can be flexible and is currently much more cost-effective than solar photovoltaics. We go into a lot more detail in our article about the great possibilities for solar thermal power.