Bright prospects for renewable energy

The Economist has a story running on the bright prospects of renewable energy. Some exerpts:

All the biggies are getting into the game, including the oil giants Royal Dutch and Shell, and GE's focus on Ecomagination where Jeffery Immelt reiterates his vision of "Green in green" referring to a green environment leading to green bucks. The likely reason is that all nations, especially India and China with their rapidly growing demands, are getting more and more into deployment of environment friendly technology. Therefore companies have to differentiate themselves on its basis, especially with the whole Kyoto deal (which was more or less a failure but it's the first step that matters the most). The upside is more and better options for stand-alone unconventional power production units, which are also environment friendly.

The problem with renewables was their payback periods and expenses that could only be supported by government subsidies, but that it likely to change with all the research going into renewables. Another positive factor are clever business models that allow "smart" meters to do hour by hour changes in electricity prices and switch from one power source to another. For example, self owned solar panels mounted on home roofs can be used on sunny days, and the backup grid can be used on rainy days.

The interesting find was that most efficient wind turbines can produce electricity at the wholesale price (the price at which electricity producers buy and sell power on the grid) competitive with non-renewable sources. Solar panels cannot produce power at such low cost, but comparing their cost-per-kWh with wholesale prices is arguably not the most relevant comparison. This is because in general, solar panels are used not by electricity producers but by consumers who use solar power to supplement or replace power bought from utility companies at retail prices. So, solar power need only match these higher retail prices in order for homeowners and businesses to start to consider it as a viable alternative. And it turns out that the most efficient of today's solar panels do indeed match the retail price of electricity in some parts of the world with high retail prices.