Solar energy has officially become the cheapest way to produce electricity, beating coal, gas, and even wind power, according to new research from the University of Surrey.
In the sunniest parts of the world, producing one unit of electricity with solar costs as little as £0.02, a figure that shows just how far the technology has come in recent years.
The study, accepted for publication in Energy and Environment Materials, highlights how solar photovoltaic (PV) panels are now the driving force in the global shift to clean and renewable energy.
“Even here in the U.K., which is far from the equator, solar has become the cheapest option for large-scale electricity generation,” said Professor Ravi Silva, co-author of the study and Director of Surrey’s Advanced Technology Institute.
Globally, solar energy has been expanding at record speed. In 2024, the total installed solar capacity passed 1.5 terawatts—double the amount from 2020.
That’s enough power to run hundreds of millions of homes, making solar not just a futuristic idea but a cornerstone of today’s energy system.
One factor fueling this growth is the falling price of batteries. Since 2010, the cost of lithium-ion batteries has dropped by nearly 90 percent.
This makes it affordable to pair solar panels with energy storage, creating hybrid systems that can store excess solar power during the day and release it when needed.
These setups are now common in many parts of the world and allow solar to become a more reliable source of electricity, even after sunset.
Still, challenges remain. The Surrey team points out that connecting such large amounts of solar power to existing grids can be complicated. In places like California and China, too much solar energy at peak times has led to grid congestion and wasted electricity when supply outstrips demand.
“Integrating more solar into our networks is one of the biggest hurdles we face,” said co-author Dr. Ehsan Rezaee. “Smarter electricity grids, better forecasting using artificial intelligence, and stronger links between different regions will all be essential to keep systems balanced.”
The researchers also see big opportunities for innovation. New materials such as perovskite solar cells could boost solar efficiency by as much as 50 percent, without requiring more land.
Meanwhile, combining storage with smart grids could make solar not just the cheapest energy source, but also one of the most dependable.
Policies will play a critical role in this transition. Silva emphasized that long-term support is needed to keep momentum going. Initiatives like the U.S. Inflation Reduction Act, the EU’s REPowerEU plan, and India’s Production Linked Incentive scheme show how governments can drive investment and progress.
“Solar energy is no longer a niche or experimental technology,” Silva said. “It is central to creating a clean, reliable, and affordable energy system for the future.”
