http://greeninc.blogs.nytimes.com/2009/02/24/first-solar-claims-1-a-watt-industr\
y-milestone/

The solar photovoltaic industry has plenty of supporters, but wider uptake
of the technology has long been hampered by cost.

High costs have not just prevented consumers and companies plastering more
homes and offices with solar cells. They also have bolstered the claim that
large quantities of fossil fuels and nuclear power will be necessary in the
future in part because solar panels do not provide value for money.

On Tuesday, First Solar, a global photovoltaic panel maker based in Tempe,
Ariz., said it had reached an "industry milestone" by reducing its
production costs to less than $1 a watt.

In a statement - seen by Green Inc. on Tuesday - First Solar, which has
produced modules for solar installations in several countries in Europe,
said it had brought costs down to $1 from $3 over the past four years
through economies of scale by increasing its production capacity by 50
times, and by passing on those savings to consumers.


First Solar's chief executive, Mike Ahearn, tipped his hat to countries like
Germany that have offered generous tariffs to producers of solar
electricity.

"Without forward-looking government programs supporting solar electricity,
we would not have been able to invest in the capacity expansion which gives
us the scale to bring costs down," Mr. Ahearn said in the statement.

Much of that investment has come by way of so-called feed-in tariffs, which
allow solar operators, large and small, to earn a higher price for each unit
of energy they produce for a grid than utilities reliant on electricity from
dirtier sources like coal. The higher tariffs help operators cover the
comparatively higher cost of production.

My colleague Kate Galbraith has written about how states and cities in the
United States, including Gainesville, Fla., are exploring the use of such
tariffs.

"The company's long-term financial model suggests manufacturing cost targets
of 65 cents to 70 cents by 2012 and it believes reductions below these
levels are possible over time," Mr. Ahearn said.

The implication of what Mr. Ahearn is saying seems to be this: Continue
government support for the industry now, and solar power will be able to
match peak-hour pricing by from coal and natural gas by 2012 - meaning that
the industry would not need subsidies anymore.

That certainly makes it sound like solar is close to enabling clean,
renewable electricity at competitive prices. What do you think?