Who Will Win the Solar Race?

Energy is still cheapest when it comes from fossil fuels, excavated in the form of oil, coal, or natural gas. But as the price continues to come down on the unit cost of energy from solar and wind, countries that have traditionally been the biggest polluters of greenhouse gases are taking bigger steps toward clean energy.

This year China is planning to install 12,000 megawatts of solar capacity. That’s about what it takes to power all of New York City at the peak of summer. It’s also more in one year than the U.S. has installed since 1888, when a New Jersey chemist patented the world’s first solar cell.

China may be winning, yet other countries compete with impressive leaps. Japan and the U.S. have added more solar capacity in 2012 and 2013 than ever before. By many projections, 2014 is expected to be a bonanza year in both countries, and in Germany too, which has always been a solar powerhouse even though last year the U.S. eclipsed it for the first time.

The competition shouldn’t be jus about adding the most solar panels to the energy grid. I think the more revealing metric is how those panels being installed today are different from those just a few years ago. Last year, the U.S. Department of Energy set a goal of $1 for the cost of each watt of installed solar capacity. That would bring the cost of solar power down to six cents per kilowatt-hour, which is cheaper than the current average rate for natural gas.

That kind of goal makes solar power due for a gold rush of ideas. Engineers are already working on game-changing concepts, such as solar paint to cover roofs or driveways. Photovoltaic fabrics that are already as efficient as stationary panels can hang on the sides of buildings. A British company called Oxford Photovoltaics is working on translucent panels to turn entire skyscrapers into generators without blocking anyone’s view.

Taken together, it’s easy to see why solar has an exponential growth rate. Each year of development dwarfs the one before it. The measure of international competition won’t always be who can add the most capacity, but who can come up with the technology that changes the whole game.