An examination of the last factor, "relative advantage," reveals why there are so many challenges associated with making solar more widespread.
"Relative advantage" is the extent to which solar is viewed as better than the method in current practice. Fundamentally, a new product or service will be successful if it does a better job than existing products at satisfying the needs of a targeted customer group. But "doing a better job" actually has four components. If a new product or service can exceed existing offerings across all four of these components at once, then we can guarantee that the targeted customer group will purchase it.
The four components expressed in terms of solar electric power are:
- solar must be less expensive than power from a utility (lower price).
- solar must provide better features or functionality than power from a utility (greater benefits).
- solar must not have any switching or adoption costs (easy to use).
- solar must be readily available (easy to buy).
The convenience and reliability of utility-delivered electric power makes it very difficult for solar to meet all four criteria. Grid parity alone is clearly not enough.
Does Grid Parity Matter?