The success of solar is remarkable, no less because the amount of federal subsidy in absolute terms has been far less for renewable energy than for fossil fuel resources (see graphic below).1 As the cost of solar drops toward – and below – grid parity, the question is how to adjust solar subsidies appropriately. Should they be eliminated immediately? Phased out? Or shifted from reducing the upfront cost to some other solar-boosting strategy?
Over the next decade, solar electricity will let consumers get cheaper energy from their rooftop than from their utility. Among the upheaval in the electricity system, the coming of solar “grid parity” means re-thinking incentives for solar energy.