Over 150m households, 23m businesses could switch to solar by 2050 — report

Source: · MINING DOT COM · | September 28, 2021

SourceSolar panels at nuclear plant. (Reference image from Pxfuel)

Changes in global policies and tariff design will be critical to activate the customer-sited solar market, which could see 167 million households and 23 million businesses worldwide hosting their own clean power generation by 2050.

A recent report by BloombergNEF (BNEF) and Schneider Electric reaches this conclusion after running a series of analyses that yielded that the rapidly falling costs of solar technology have already made it economical for homes and businesses to generate their own power in some markets.

“In Australia, for example, the payback period for households investing in solar has been favourable, at less than 10 years, since 2013,” the report reads. “As a result, adoption has already taken off, with more than 2.5 gigawatts of residential solar added in 2020 alone.”

According to the document, solar adoption mainly occurs when there is an economic case for the households and businesses investing in the technology, usually in the form of high internal rates of return or short payback periods. Meanwhile, in regions where the economics have not yet reached such tipping points, policymakers are introducing targeted incentives to create favourable market conditions and bring forward deployment.

“One such example is France, where existing incentives mean that residential solar can earn internal rates of return of around 18.5% (a five-year payback), and commercial installations achieve 10.4% IRR (or a nine-year payback). This has stimulated gradual growth in the market, to about 500 megawatts of installations in 2020,” the review states.