oil was inexpensive once, but demand drove the prices higher. If a company makes a product, an introductory price is tested in the market, regardless of production costs. The price will go up when demand increases, but even if demand ceases to exist, the price should drop. If no one is using the expensive solar cells, why does the price not drop? Greed. tesla wanted to provide energy to the masses, but the greed of large corporations quashed his efforts and killed his research. Do not think our powers that be will ever let us use cheaper energy, as that would reduce taxes that pay for their raises. the fact that the gov't is not allowed to have profits from a business or company is ridiculous and keeps us chained. We could make them work for us, society at large, and pay less taxes and less for energy if they were made by voters to be accountable for their actions. oust all of the uncooperative politicians, favor the ones who want change in the publics favor.

The price of oil will come down when supply outstrips demand and the costs of production decline.

The price of solar is coming down as the costs come down.

Energy prices are very elastic. The lower the costs of energy the higher the demand. The higher the costs of energy the lower the demand. Want more demand? Lower energy costs. Want even more demand? Lower energy costs further... That's what's happening now with natural gas. There's a tidal wave of demand coming to natural gas because of unusually low prices.

A new tidal wave of demand will come to solar power when it breaks through to being even cheaper than coal or natural gas based electricity. Solar power generation currently is growing at about 30% annually.

Hopper, I ranked you a two because you seem to forget that supply is controlled, and limited. Near term I think your right that supply and demand controls the price mostly. In the future as supply runs out, the electric grid looks more and more promising.

Energy is a very tricky business. As howhot said the rules pf perfect competition on demand and offer don't work here, because there isn't a perfect competition scenario and also energy is not what economist would call a normal good, perfectly elastic.

What we should be concerned with in this fossil vs renewable energy debate is system efficiency. One way to compare this is in monetary values, like price of kwh from coal vs gas vs solar vs wind vs etc, but the problem is that because of all the government subsidies (some direct, other indirect) it is almost impossible to determine the real cost...

Another way might be to try to compare systems ( from extraction/production to conversion ) in terms of efficiency. How much energy did i invest to get 1 mwh for example. Based on these results we can start adding carbon adjustments to each system in order to weight environmental impact.

For example coal might have a better efficiency than solar but if we put a x cap of Co2 emissions per mhw, coal might suffer supplemental costs and then solar might be cheaper.

I've been looking for articles that tackle this approach but I haven't found so far. Most are just biased because they include subsidies, which is nothing more than an indirect way that we pay the bill.