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Energy prices, and thus savings, are certain to increase over that 30 years too. Quite likely at a rate exceeding inflation.


Energy prices have been mostly flat relative to inflation for 40 years, and there's a reasonably good chance that they will start dropping appreciably (at least during peak daylight hours) as solar continues to make major inroads.


That's true in a lot of places but not really in California, where there's a lot of customers for solar. I don't need to go into the reasons why. It's California.


Why so? California's climate is pretty optimal for solar generation and there's a lot of desert waiting to be covered in solar panels.

Solar is not going to have a similar impact on (say) Ireland in the next 30 years.


More solar will likely result in higher grid energy prices, since people will buy a lot less energy while the grid costs the same to maintain.


Solar can also reduce grid costs, by e.g. shaving the yearly peak power demand, which is usually a summer afternoon so it's not clear cut.

Probably the bigger impact is bad incentives for the people building the grid, who are often able to do what they like and get a guaranteed percentage return on top, which pushes them to spend more than they need to. This has been particularly pronounced in Australia I believe.


Usually when there is additional competition (grid owners generate and supply electricity), markets respond by dropping prices.

This might also be why utility companies have been furiously lobbying against rooftop solar subsidies and Barclays have downgraded US utility bonds.


Solar leases use the 2% inflation rate too as a way to make them look more attractive (as does the solar roof calculator) but in reality electricity hasn't been getting more expensive at that rate.


People made similar pronouncements about gasoline a decade ago. $4/g gas is a distant memory.


Increasing renewable energy sources and an abundance of fossil fuels is going to increase energy prices at a rate higher than inflation? I don't think so.


Not clear on the historic evidence, and especially not clear when you consider people swapping cap ex for op ex.




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