Declining subsidies and oversupply are seen by many as death stars to solar energy, but the industry in the U.S. is just pausing, and expansion is projected for the next two decades, according to a new study. Entitled, "Solar Power: Darkest before dawn," the report by McKinsey and Co. suggests a bright future ahead for nature's most abundant natural power source.

From the McKinsey web site: "McKinsey research indicates that the industry is suffering from growing pains rather than undergoing death throes. Solar is entering a period of maturation that, in just a few years, will probably lead to more stable and expansive growth for companies that can manage costs and innovate to tap rising demand from multiple customer segments."

Here's a link to the write-up, and also to an earlier blog that discusses the boom-and-bust cycle of clean energy and notes the industry is at a crossroad.

The report finds that falling prices will spur demand, even without subsidies, for five key markets: "off-grid, residential and commercial in areas with good and moderate sun conditions, isolated grids, peak capacity in growth markets, and new large-scale power plants."

Critics point to the implosion of Solyndra, companies downsizing, fights between solar developers and environmentalists, and other issues as an industry in disarray. But is it? Various reports say solar power will reach grid parity with traditional sources of power within a few years. GE says here that dropping solar prices combined with rising fuel prices will make solar energy cheaper than fossil fuels within five years.

Bloomberg here projects solar to be investment worthy in the U.S. by 2020.  Banks could become moret than bit players, according to this post.

This post in Triple Pundit by sustainability consultant Leon Kaye suggests the industry "shakeout" will continue for at least a year, and shouldn't be viewed as a "meltdown," but rather as laying the foundation for expansion.

Think about it. Increasingly, volatile energy prices are playing havoc on budgets, and businesses are looking for some balance. Delta Air Lines is so desperate it is spending $150 million for its own oil refinery. The Washington Post has more here.

Closer to home, we in Fresno, CA., are seeing solar panels installed at wineries, schools, farms and on rooftops. Fresno is ranked 4th in the state in rooftop solar capacity, and dozens of solar arrays are proposed throughout the San Joaquin Valley, according to local planning officials.

Solar really makes sense here. The Valley is the nation's salad bowl, and the $25 billion agriculture industry consumes lots of power. So, it makes sense farmers want to reduce their bills and carbon footprints. Temperatures are high, power bills skyrocket during the I'm-going-to-spontaneously-combust-walking-to-my-car summers, the sun shines much of the year and the air quality is among the worst in the nation.

 There are other uses for solar too. Did you know that oil and solar can mix?. Check out this about a California-based start-up, and this about Chevron and Bright Source Energy teaming up in an oil field in Fresno County. And I wonder if a nifty new mapping tool like this will spark a solar rooftop revolution.

"Revolution." That may not be too strong a word.

Image by Gabriella Fabbri