Tuesday, December 2, 2014

The effect of falling oil prices on solar energy market

Is investing in solar energy still the right business move, even despite the falling oil prices? Some analysts believe that the recent decline in oil prices will reduce investment into solar energy sector. This theory is based on the fact that solar power will be less competitive with oil if oil prices remain low.

However, this theory is very much open for debate because solar power hasn't been that competitive with fossil fuels before this plunge in oil prices meaning that cost-competitiveness is not the only factor that decides the trends at the global solar energy market.

Whether oil prices will continue to fall or not it remains to be seen though this looks like a very likely scenario especially after some OPEC members proposed reduced oil output in order to stabilize falling prices.

The popularity of solar energy and the fact that solar energy industry is one of the fastest growing industries in the world is not built on cost-competitiveness because if this was the case then solar energy market wouldn't be growing so rapidly.

The favorable legislation which heavily subsidies solar energy is the cornerstone of rapidly expanding solar energy sector. Oil prices, even if they continue to fall, will certainly not have long-lasting effect on global solar energy market.

Solar energy market has everything that is needed to grow further. Solar energy is destined to become number one energy source in years to come. Sure, the slowdown of solar energy industry remains a very distant possibility but on the long run solar energy looks like a clear favorite to finish the global energy race as the undisputed winner.