Solar cells now supply electricity to more than one million homes worldwide. World production of solar cells, which convert sunlight directly into electricity, soared to 742 megawatts in 2003, a jump of 32 percent in just one year. Japanese production of photovoltaics, which accounts for 49 percent of the world total, has benefited from a variety of government incentive programs. By 2002, the number of residential systems installed in Japan had reached 144,000. European production has also boomed, with a growth of 41 percent in 2003.
Germany, the second largest market for photovoltaics, positioned itself with the 100,000 Roofs Program, launched in late 1998, which provided 10-year low-interest loans for PV installation. By the end of 2003, German installed capacity was 400 MW, well beyond the initial goal of 300 MW. In contrast, PV production in the United States decreased by 14 percent in 2003, dropping to 104 MW. California’s Environmental Protection Agency recently proposed a Million Solar Homes Initiative that would require half of the new homes in the state to run on solar power within 10 years, with a goal of a total of 1 million solar homes within 13 years. China may soon become an important player in this field. According to officials, the government is ready to invest $1.2 billion in solar energy development over the next five years. It also expects to have a total installed capacity of more than 300 MW by 2005. Worldwide, the solar industry is a $7-billion-a-year business, and it is expected to continue growing as solar cell manufacturing costs decrease..
Rural areas in developing countries stand to benefit the most from solar energy. For the 1.7 billion people whose homes are not connected to an electrical grid, solar cells combined with storage batteries are often the cheapest source of electricity. Through microcredit programs with 30-month financing, the monthly costs of solar cells are often comparable to the cost of kerosene lamps and candles, usually the current source of light. PV systems offer high-quality electric lighting, which can enhance educational opportunities and provide access to information. A shift to solar energy also brings health benefits by allowing vaccines and other essentials to be refrigerated and by improving air quality as kerosene lamps are replaced.
Further sustained growth will be possible with increased funding for research and development and with continued economic incentives. The expansion of net metering laws, together with microcredit loans and the removal of distorting fossil fuel subsidies, would allow solar energy to compete in a more equitable marketplace. At the international level, global partnerships that provide opportunities to exchange experiences and market information, such as the Global PV Industry Platform launched in June 2004 by Japan, the United States, and Europe, are expected to reinforce local measures, bringing the world closer to a postñfossil fuel age.