he world is continuing to make considerable progress toward achieving a cleaner, carbon-free future. And even though we experience some setbacks along this way, the clean energy shift keeps accelerating.
As global governments are becoming increasingly concerned with the environmental challenges associated with fossil fuels, they put more concentrated effort into supporting renewable energy. According to a report by the International Energy Agency (IEA), global green energy investment is expected to be greater than $1.4 trillion in 2022, accounting for nearly three-quarters of the total energy investment growth. The highest renewable investments are currently made by China, the European Union, and the United States. And even though renewables enjoy sufficient support only in advanced economies and China, over 130 countries around the world have already adopted certain clean energy policies.
Nevertheless, some opponents of renewables still say this massive subsidizing is a strategic blunder, as clean energy sources do not have the slightest chance of becoming cost competitive with fossil fuels. That pessimistic view is fundamentally flawed, however, because strong support given to renewable energy is already yielding great results, making it as much, if not more cost-effective than fossil fuels. Solar energy affects environment positively by reducing greenhouse gas emissions, mitigating climate change, and conserving natural resources.
Solar power is a clear leader here. It is the world's fastest-growing source of power, accounting for over half of the global renewable capacity installed annually. The price of electricity from solar PV has dropped by more than 80% over the last decade, making its deployment even more cost-efficient. In many parts of the world, PV energy has reached so-called grid parity - the point at which it is at least as cheap as electricity coming from fossil fuels. For example, solar parity against conventional power sources has already been achieved in China, most of the United States, and several European countries such as Spain, Germany, and Italy.
So why is it a key milestone for the solar industry? With PV energy now at parity against the grid, the cost is no longer a hindrance to its development. Passing through grid parity solar power keeps getting cheaper: the Levelized costs of electricity (LCOE) of utility-scale photovoltaics is currently lower than that of new coal- and gas-fired power plants in many regions of the world, according to IEA. The electricity from new large-scale PV projects will cost in the range of $30-60/MWh in Europe and the U.S., and $20-40/MWh in China and India, which makes solar PV the cheapest source of electricity in history.