13 Dec '11, 12am
Here Comes the Sun – The Chart Paul Krugman Left Out
As Krugman notes, the falling costs of solar make time its greatest ally. The following chart illustrates the number of Americans in the top 40 metropolitan areas for whom solar (at $3.50 per Watt in 2011) beats grid electricity prices (average residential retail rates) over the next 10 years. The base assumptions are that the price of solar declines by 7% per year and grid electricity prices rise by 3% per year. The chart examines solar with no incentives and with the 30% tax credit, and with and without utility time-of-use pricing (expected to boost the retail rate during solar-producing hours by 30%). The no-incentive and tax-credit lines merge after the 2016 expiration of the 30% tax credit.