A little story here to remind us of just how awesome the power of markets is. For the competition within such markets drives both technological advance and also price drops. And things getting better and cheaper over time is the very thing that has lifted all of the rest of us from that destitution of peasant poverty to being, as we are today, the richest group of human beings that has ever existed.
Here in this section we're about matters economic and the specifics of this industry belong over in the business section, the longer term effects over in the environmental. But we can still pause, just briefly, to admire the effect these markets are having:
SunPower Corp. unveiled a restructuring plan that includes reducing the company’s global workforce by 25% and a lower capital-spending budget for next year.
The solar-products company also projected 2017 revenue that missed analysts’ expectations.
That sounds terrible really, doesn't it? But the reason why it's so wondrous is here:
Solar companies have been hard hit after stiff competition pushed prices of solar panels lower and as customers held off purchases in the hope of a further decline in prices.
SunPower, majority owned by French energy giant Total SA, said in November that its average selling price declined about 25% in the third quarter.
As we're continually told by the environmentalists we must, just must, move away from fossil fuels and over to non-emitting sources like solar. And quite obviously that will happen entirely naturally as soon as solar is cheaper, at the point of use, than coal. And of course it is already so in certain places. And further price reductions like this will make it so in more places. These cost reductions just keep taking us closer and closer to the point that we've solved climate change. For when solar really is cheaper than coal then everyone will preferentially be installing solar, won't they? At which point, job done.
And look at what it is which is driving those cost reductions. Just people getting that little bit better, month by month and quarter by quarter, at making the panels. As everyone else is doing the same all must strive to do so--competition is driving that technological advance and competition is ensuring that the greater efficiency results in lower consumer prices, not higher producer profits. It's all rather akin to Marx's insistences about true communism. Sure, it would come one day, but it would be capitalism and markets which delivers the precondition for it, the absence of economic scarcity. So it seems to be with climate change. To beat it we need non-emitting energy sources which are cheaper than fossil fuels. And it looks like that free market competition is delivering exactly that.
And isn't that marvellous?
Now all we've got to do is work out why US government policy seems to be to drive up the price of such panels by imposing tariffs on cheap ones being made by foreigners....don't they realise that climate change really is an important issue?
