Grid Parity: The Tipping Point
When renewable energy becomes cheaper than fossil fuels - understanding the economics, technology, and policy forces driving this transformation
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Section 1 of 5What is Grid Parity?
Grid parity is the point where renewable energy sources become cost-competitive with traditional fossil fuel-based electricity generation. It's the economic tipping point where clean energy no longer needs subsidies to compete in the marketplace.
Achieving grid parity represents a fundamental shift in the energy landscape. It means renewable energy can stand on its own economically, driven by technological innovation, economies of scale, and market forces rather than government incentives alone.
Why Grid Parity Matters
Grid parity accelerates renewable energy adoption by making clean energy the default economic choice. It reduces reliance on fossil fuel subsidies, creates jobs in new industries, and provides energy security through diversified, domestic energy sources.
Interactive Grid Parity Status Dashboard
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Cost Comparison: Solar PV in Global Average
Key Insights
- • Grid parity varies significantly by technology, region, and local conditions
- • Solar and wind have achieved parity in many markets, especially with favorable policies
- • Regional differences reflect local resource quality, infrastructure costs, and policy support
- • Achieving grid parity is a moving target as all energy costs continue to evolve