Many industrialized nations have installed significant solar power capacity into their grids to supplement or provide an alternative to conventional energy sources while an increasing number of less developed nations have turned to solar to reduce dependence on expensive imported fuels (see solar power by country). Long distance transmission allows remote renewable energy resources to displace fossil fuel consumption. Solar power plants use one of two technologies:
The political purpose of incentive policies for PV is to facilitate an initial small-scale deployment to begin to grow the industry, even where the cost of PV is significantly above grid parity, to allow the industry to achieve the economies of scale necessary to reach grid parity. The policies are implemented to promote national energy independence, high tech job creation and reduction of CO2 emissions. Three incentive mechanisms are often used in combination as investment subsidies: the authorities refund part of the cost of installation of the system, the electricity utility buys PV electricity from the producer under a multiyear contract at a guaranteed rate, and Solar Renewable Energy Certificates (SRECs)
As of 2011, small solar PV systems provide electricity to a few million households, and micro-hydro configured into mini-grids serves many more. Over 44 million households use biogas made in household-scale digesters for lighting and/or cooking, and more than 166 million households rely on a new generation of more-efficient biomass cookstoves.[26] United Nations' Secretary-General Ban Ki-moon has said that renewable energy has the ability to lift the poorest nations to new levels of prosperity.[14] At the national level, at least 30 nations around the world already have renewable energy contributing more than 20% of energy supply. National renewable energy markets are projected to continue to grow strongly in the coming decade and beyond, and some 120 countries have various policy targets for longer-term shares of renewable energy, including a 20% target of all electricity generated for the European Union by 2020. Some countries have much higher long-term policy targets of up to 100% renewables. Outside Europe, a diverse group of 20 or more other countries target renewable energy shares in the 2020–2030 time frame that range from 10% to 50%.[11]
As the cost of solar electricity has fallen, the number of grid-connected solar PV systems has grown into the millions and utility-scale solar power stations with hundreds of megawatts are being built. Solar PV is rapidly becoming an inexpensive, low-carbon technology to harness renewable energy from the Sun. The current largest photovoltaic power station in the world is the 850 MW Longyangxia Dam Solar Park, in Qinghai, China.