Of all the energy freely available to us, the sun is by far the largest. The amount of solar energy the Earth receives every minute is greater than the amount of energy from fossil fuels that the Earth uses in a year!
Solar power is one of the more mature alternative energy sectors. The idea is not new. A type of concentrated solar power system was used in the 1870s to drive steam engines. Modern solar energy technologies harvest the sun's energy waves. Photovoltaic (PV) cells make electricity from photosensitive materials that respond to the visible light spectra of sunlight. Solar thermal technology such as hot water systems and concentrating solar power (CSP) systems, directly harness heat from infrared light spectra.
Solar systems have seen massive innovations, refinements and cost reductions in the last few years. There is now the potential to make solar so cheap and cost effective that it can be deployed anywhere. In the last decade the annual growth rate of solar installations has sky rocketed in countries such as Spain,Belgium, Republic of Korea, Portugal and Germany. As the industry further matures the percentage growth of installments slows but the amount of solar panels being produced and installed is much greater. This is good news for investors. Five countries that could lead the way in the next five years are: Italy, U.S.A, France, India and China. Good opportunities are also emerging in Canada, Australia and Central Europe.
Canada has burst onto the green scene in a big way. Some provinces are planning to get rid of fossil electricity generation entirely in the next few years!. But it is the U.S.A that is considered the sleeping giant of the solar industry. We believe it could be about to wake up! The US government's recent stimulus package has given a real boost to the solar industry.
In the short term there are still some hurdles to be overcome - at the moment solar power and virtually all other alternative fuel sources cannot compete with coal and oil on a cost-per-kilowatt basis. Currently, solar power can be produced for roughly 15 cents/kW while gas and coal power comes in around 4-5 cents/kW.
When traditional fossil fuel prices rise, alternative energy becomes more competitive on cost, especially when generous government subsidies are added in. For ethical investors the investment opportunities abound for low-cost, high-quality providers.