Electricity generated by solar panel systems has been predicted to become competitive in all European markets by the end of the decade.
The news comes from the European Photovoltaic Industry Association (EPIA) and confirms the future viability of the technology as a sustainable energy source around the globe.
It is believed that some markets will experience a competitive solar energy market as early as 2013.
A critical factor in determining the future sustainability of solar power has been its ability to outperform other energy generation technologies in terms of price and reliability of supply.
Solar has seen global drops in price – both in terms of the cost of producing materials as well as installing systems.
According to the EPIA, the cost of photovoltaic (PV) equipment could drop by up to 50 per cent by the end of the decade.
EPIA president Ingmar Wilhelm says: "Already today, PV electricity is cheaper than many people think.
"In the coming years it is going to get even cheaper thanks to ever-improving technology and economies of scale."
Increased affordability will fuel adoption worldwide, along with government incentive programs which have demonstrated themselves to be effective at convincing consumers to make the switch in Australia.
"As … the price of electricity from conventional sources increases, solar PV will be become a fully competitive part of the energy mix," says Wilhelm.
The report concludes that given the right conditions, European solar power could reach grid parity by 2020.
Grid parity occurs when the price of generating and distributing solar power is equal to the cost off other forms – such as coal-fired power.
Once equilibrium has been established, the incentives to adopt solar power increase dramatically.
When given the choice between paying an equal amount for clean power, compared to a polluting source, it is believed the majority will support the renewable option.
The report also notes that the political commitment of governments is a key component required for the success of solar schemes.
This sentiment has long been echoed in Australia, as government initiatives such as solar credits and feed-in tariffs have resulted in thousands of households and business owners deciding to install systems on their rooftops.
Such programs will only help solar gain a firmer foothold in the energy market, leading to an increasingly competitive solar industry.
Bob Dawson – News Editor