6 ms·

Why do you assume the price of energy (and solar panels, for that matter) would stay constant as investors flock to blanket the earth with them? I like your ge

• kragen 16y ago
  > Why do you assume the price of energy (and solar panels, for that matter) would stay constant as investors flock to blanket the earth with them? I don't; the energy price I used is about a third to a quarter of today's wholesale electrical price, and the solar-panel price is about a tenth of today's. I assume that those prices will drop rapidly. I think they will probably drop a lot further than that, but it's very difficult to imagine what will happen when some resource drops in cost by more than a factor of ten. > I like your general logic - but I disagree strongly with your prediction that buying solar panels will generate 40% return on investment (in year 1!) in 2029. I'd like to disclaim that prediction! It was a scenario, not a forecast. It doesn't have to be solar panels specifically, but my point is that over time, we may develop capital goods whose internal rate of return is well over the 3% we've become accustomed to. (Solar panels are a plausible candidate because their production is already highly automated, they're made of dirt-cheap raw materials, and they produce energy.) If that happens, whether it's solar panels or automated moon factories, P/E ratios will drop --- at least until the new exponential takeoff hits some resource limit. In the case of solar panels, that will probably be land, until we construct a Dyson sphere.