Forty-seven years ago U.S. President Jimmy Carter stood grinning in front of a set of 32 bulky solar panels. It was 1979, and the oil crisis had sent fuel costs skyrocketing. Carter, in response, was making the White House an example of conservation and alternative energy. “Solar energy will not pollute our air or water,” he said. “We will not run short of it. No one can ever embargo the sun or interrupt its delivery to us.”
The panels were expensive and rudimentary by today’s standards. They cost roughly $160,500 in 2026 dollars, and they didn’t even generate electricity; all they did was heat water for things such as kitchen use. But Carter’s argument still resonates today: in a globalized economy in which a single conflict can shut down shipments of millions of barrels of fossil fuel overnight, the allure of the sun as a power source is inarguable. And there’s no better deal on energy, well, under the sun. “Today solar makes the cheapest electricity,” says Walajabad S. Sampath, site director of the Center for Next Generation Photovoltaics at Colorado State University.
Even before the U.S.-Iran conflict closed the Strait of Hormuz for months, causing fossil-fuel prices to spike, solar was soaring. Last year the world added 600 terawatt-hours of solar photovoltaic generation, enough to power Canada for a year. It was the first time that a renewable source took the top slot in global supply growth. It was also the largest single-year increase for any electricity-generation technology, according to the International Energy Agency (IEA). As energy think tank Ember pointed out in April, today’s global solar generation is equal to the entire electricity demand of the European Union. And although solar is still catching up to natural gas and coal, its share of energy generation grew by nearly 19 times from 2014 to 2025.
On supporting science journalism
If you're enjoying this article, consider supporting our award-winning journalism by subscribing. By purchasing a subscription you are helping to ensure the future of impactful stories about the discoveries and ideas shaping our world today.
The Trump administration has been hostile to solar power, cutting billions of dollars in funding for affordable projects and refusing to issue new permits through the Department of the Interior. But thanks in part to tax incentives and investments that predated the administration, solar power still has momentum in the U.S., and the economics remain attractive. In fact, this May solar outpaced coal’s monthly power share in the U.S. for the first time ever.
Here’s why a once niche energy source became a global powerhouse.
Solar Is Now the Cheapest Way to Produce Energy in Human History
When Sampath started in the field, in the early 1990s, the thinking was that no solar panel could ever recapture enough energy from the sun to offset what went into building it. Today a standard solar setup reclaims its production energy in a year or two, and a home system costs roughly $25,000, making it much more practical than what Carter installed at the White House.
The cost-effectiveness of solar energy is partly attributable to technological advances that have driven efficiency up—a state-of-the-art IBM panel used for research in 1977 had an efficiency of 22 percent, which is now achievable with the best home systems (standard systems run at about 20 percent).
One major advance made in the late 1980s was a type of solar cell called a “passivated emitter and rear cell” (PERC), which included an extra reflective layer on the back of the cell that captured more light to turn into electricity and blocked longer wavelengths that could damage the equipment. Since 2024 another technology, the crystalline-silicon-based tunnel oxide passivated contact cell, has pulled ahead of PERCs because of its advantage in efficiency and easy high-volume production. “Higher efficiency means you need [a smaller] size of the panel, you need less land, less wiring, less racking,” or the mounts for the panels, to generate a given amount of energy, Sampath says. “All of that goes down as the efficiency goes up.”
“Today solar makes the cheapest electricity.” —Walajabad S. Sampath
Colorado State University
The plummeting price over the past decade is also a result of advances on the production side: the materials are purer, and the manufacturing process is more precise. Scale has contributed as well. The Chinese solar industry is now highly integrated and efficient, and larger factories can churn out panels at a lower cost per unit than when solar was a niche industry with smaller production lines. The world—led by China—can now produce enough solar modules in one year to generate a collective 1,405 gigawatts of energy.
All of this adds up to cheap electricity. Last year financial advisory firm Lazard published a report showing that the levelized cost of energy—the cost of a project divided by its expected lifetime energy production—for new utility-scale solar was $38 to $78 per megawatt-hour (MWh), compared with $48 to $109 per MWh for new natural gas plants. Indeed, in 2020 the IEA declared that many solar projects were now the cheapest form of energy, not just today but in all of history.
Even in places where government support is weak or has declined, such as the U.S., solar “will continue to be at a competitive price,” says Christopher Namovicz, an analyst at the U.S. Energy Information Administration. Solar has now irrevocably joined coal and natural gas as an inexpensive way to power the world.
Two Countries Decided, If Inadvertently, to Make It Happen
Although the technology behind solar power has been around since the 1950s, its recent rise can be traced in part to developments in two countries in the early 2000s: Germany and China. At that time, the German Green Party leveraged a power-sharing arrangement to demand subsidies for rooftop solar, says climate writer and environmentalist Bill McKibben. Around the same time, China was massively expanding its manufacturing capacity. The German subsidies helped to create a European market for solar modules and components, and Chinese firms built factories to meet that demand.
After the 2009 economic crisis caused demand for solar panels to drop, the Chinese government stepped in to negotiate minimum import prices with the E.U. to prop up exports and set up national solar targets to jump-start domestic demand. China “had domestic supply but little domestic market, and pollution was emerging as an issue, so it fit multiple priorities,” says Lauri Myllyvirta, co-founder of the nonprofit think tank Center for Research on Energy and Clean Air (CREA). Beijing later forced firms to consolidate, preventing competition that might wipe them all out, which led to a vertically integrated, highly efficient industry, says Michael Davidson, a professor of policy and engineering at the University of California, San Diego. The government also began investing billions in clean-energy research and development.
China’s solar industry drove innovations in production, too, so the processing of raw materials became much more consistent—the silicon that goes into commercial panels today is 99.9999999 percent pure, Sampath says. The fact that China makes the vast majority of the world’s photovoltaics also gives it an edge, he adds, because large-scale manufacturing pays off in cost. “They put their mind to it, stayed with the improvements,” Sampath says. Now China is not only the largest producer, he says, but also the largest market.
As of 2024, China produced more than 93 percent of the world’s polycrystalline silicon, nearly 97 percent of its silicon wafers, about 92 percent of its photovoltaic cells and about 86 percent of its photovoltaic modules, according to data from the China Photovoltaic Industry Association. China now produces 10 percent of its power from solar, Myllyvirta says.
Last year renewables met all of China’s new demand, allowing it to stabilize greenhouse gas emissions even as its energy requirements continued to grow. The country produces so much solar equipment, in fact, that it has struggled to find enough buyers, although the recent war in Iran has boosted demand. This past March solar exports reached a record high equivalent to the entire solar capacity of Spain.
China is also investing heavily in the development of next-generation solar cells, Davidson says. He adds that the country will almost certainly be the first to commercialize higher-efficiency tandem solar cells, which often combine silicon with materials called perovskites. In other words, China’s solar industry is likely to dominate the world for a long time to come, Davidson says: “The Chinese firms are still miles ahead and are more competitive than any other global firm.”
Solar Lets Countries Skip Fossil-Fuel Dependence Entirely
In the village of Kijumba in rural Uganda, a stone’s throw from two petroleum pipelines, people have long burned grass or firewood for light. Roughly half of Ugandans still lack electricity. Yet electric lights now cast a glow on some homes in Kijumba, where a campaign called REPower Afrika is teaching local women to install solar systems themselves.
REPower started in 2024 to bring solar power to villages where people had been displaced by the construction of a fossil-fuel pipeline. Solar is “very easy to decentralize,” says Rukiya Khamis, East Africa program manager for the climate-justice organization 350.org. “Everyone can use it. [You] can put it on top of your roof, and you’re set. It’s like a plug-and-play situation.”
Across Africa, nations installed 4.5 new gigawatts of solar capacity in 2025, a 54 percent increase from 2024—the continent’s largest solar-growth year so far. “Africa’s solar revolution is here,” says Sonia Dunlop, CEO of the Global Solar Council (GSC), a trade group representing the solar industry. According to the GSC, centralized, utility-scale projects explain an average of only 15 percent of solar-panel imports over the past four years, indicating that small, rooftop panels make up a big chunk of the solar growth.
That kind of independence is appealing not only from an energy-security standpoint, Khamis says, but also from a justice one: small-scale solar doesn’t have major environmental impacts or displace people from their homes. And the energy starts flowing immediately. “If I am in a remote village in Africa, it’s going to take a decade before anyone is going to build a power line to my village,” says Daan Walter, an Ember research principal. “But I can buy a solar panel, like, tomorrow and get it in a month.”
Price is a driving factor in larger projects in developing economies, too, Walter says. Solar has long carried an up-front cost that many individuals and businesses can’t afford, especially in emerging economies where borrowing costs can be higher. To make a project such as a solar-powered small factory feasible, borrowers need to pay back their costs in two to three years, Walter says. When new coal and gas were cheaper than new solar, solar took too long to pay out, and fossil-fuel sources were still the most affordable option in developing economies. But inexpensive systems manufactured in China are competitive with the cost of new coal and gas, so solar “no longer forces consumers who have high borrowing costs to go for the fossil option because it’s the only thing they can afford in the short term,” Walter says.
Increases in the cost of living caused by the closure of the Strait of Hormuz are further making solar panels—as well as electric boda bodas, the motorcycle taxis that ply East Africa’s city streets—more attractive to everyday people. (On the other hand, they are also pushing some African governments to develop domestic fossil-fuel resources to reduce their reliance on imports, Khamis says.)
The challenge now is securing the financing and policy support to bring solar to more homes, says Edwin Mumbere, director of the Center for Citizens Conserving Environment and Management in Uganda. “Communities are increasingly recognizing that renewable energy delivers real development benefits today,” he says, “rather than promises tied to large-scale fossil-fuel projects.”
Fossil Fuels Are Subject to Scarcity; Sunlight Isn’t
Five years ago the rooftops of Lahore were all a largely indistinguishable brown. Today aerial views of some neighborhoods in this city, the second-largest in Pakistan, show a sea of black grids: rooftop solar, house after house of it.
This change came about because the people of Pakistan were responding to a crisis: Russia’s 2022 invasion of Ukraine, which led to U.S. and European sanctions on Russian oil.
Between 2022 and 2025, some Pakistanis invested in home solar systems that took advantage of favorable payment incentives, and the country went from generating 7.7 terawatt-hours of electricity with solar per year to 36.6 terawatt-hours. As of last year, solar provided more than 20 percent of Pakistan’s electricity, according to Ember. In nearby Bangladesh, in contrast, less than 2 percent of electricity comes from solar.
A 2026 analysis by CREA found that since 2018, Pakistan’s solar revolution has saved it from spending $12 billion on oil and gas imports; the country could save more than half as much again just this year by avoiding the high costs of fossil fuels caused by the U.S.-Iran conflict. “Sunlight travels 93 million miles to reach Earth, but none of those miles are in the Strait of Hormuz,” McKibben says. Spain, too, has benefited from a shift to solar and other renewables: Ambitious investments in recent years have shielded the country from price increases caused by the Iran conflict, a June report from Ember shows. In March the country’s power prices averaged just one third of those in Italy, where fossil fuels make up a greater share of the power mix.
“Sunlight travels 93 million miles to reach Earth, but none of those miles are in the Strait of Hormuz.” —Bill McKibben, climate writer
Like Pakistan, Cuba is experiencing a crisis-driven solar revolution: a U.S. oil embargo has the island’s residents cooking with wood fires and weathering repeated blackouts, so the country has turned to China. Last year Cuba imported enough Chinese solar panels and cells to generate 1,308.8 megawatts of energy, compared with 19.4 megawatts in 2023, according to Ember. It may be one of the fastest solar transitions in history. For an island nation like Cuba, decentralized solar also may be the only power option after a hurricane: when Hurricane Melissa flooded Cuba in 2025, many people went weeks without power or with only intermittent access to the grid.
Solar isn’t necessarily immune to geopolitical shocks, though. China manufactures the lion’s share of the world’s photovoltaics and batteries and could refuse to export them to certain countries in the event of conflict. Many nations also want to reduce their reliance on China even in the absence of conflict. India and some countries in Southeast Asia are increasingly manufacturing their own panels, although China still maintains control of raw materials such as polycrystalline silicon.
But if China were to restrict exports, it would affect only new growth, Walter says. “Once you install it,” he says, “no one can tell you those sunrays are not allowed to hit your roof.”