According to a report released earlier this week by the renewable energy research firm Clean Edge, renewable sources supplied much greater amounts of energy in 2012, but the high costs of solar photovoltaic panels prevented the industry from increasing the revenue by more than 1%.
In addition, new installations of solar panels bring down the prices of energy due to the fast expansion of the sector, according to Ron Pernik, the founder of Clean Edge. Despite the dramatic increase to 31GW only in 2012, the revenues dropped by around 19%.
The target that was set in 2000 stimulated the industry to aim for equalizing the cost of solar with the cost of conventional energy sources by 2020.
Surprisingly for some, the price has already fallen from $7.5 per watt down to $2.5 and it is expected to reach $1.5 in the coming 5 years. To convert this to commonly known figures, this translates to as little as 5 US cents per kilowatt hour.
The investments in the industry are also expected to increase due to the extending of various US tax incentives already available to oil and gas. Since 2001, the market share of renewables has risen by about 19%. And this is not only because of solar. Wind capacity, for example, has increased by 45GW, already surpassing natural gas investments.
Currently, 49% of the new generating capacity of the US is supplied by renewable sources.
The boost in renewable energy production is largely due to the high investments by experts, including the giants Warren Buffet’s Mid-American Energy Holdings and Google.
Another source of renewable eneregy that contributed to the incredible increase is the biofuel industry. The raising capacity of gallons of ethanol and biodiesel contributed to the overall revenue by increasing it to $95 billion. It is expected that by 2020 this number is likely to reach the impressive $122 billion.
Biomimicary, or imitating nature, is predicted to bring more innovations to the industry, according to the report. New designs of wind turbines and improvements in solar cell efficiency are expected to increase the revenue and attract even more investors.
Great potential is also seen in the geothermal energy sector, where around one fourth of the worlds existing geothermal capacity belongs to the U.S. closely followed by Kenya. The world bank is one of the major investors in this branch of the industry.
Smart grid technologies will improve the connection with the web.
Earlier this year, Bloomberg New Energy Finance reported an 11% drop of investments in the industry for 2012, however this did not prevent them to conclude that last year was amongst the most significant for the global clean energy sector.