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Will solar be the bullet that kills coal?

For the past few years, it has been assumed that natural gas is the enemy of coal, at least in the United States, where low natural gas prices have eroded marketshare from thermal coal producers.

Now, a new adversary is emerging for coal. It comes from silicon wafers, the material used to make solar panels.

According to a post in Saturday's Quartz, a digital news outlet, a small research facility in Bedford, Massachusetts is helping to perfect a new technique for making silicon wafers, and if successful, it could reduce the cost of solar by 20 percent in the next few years.

“This humble wafer will allow solar to be as cheap as coal and will drastically change the way we consume energy,” Quartz quoted Frank van Mierlo, CEO of 1366 Technologies, the company behind the new method of wafer fabrication.

The site notes that in Saudi Arabia, a 200-megawatt solar plant will produce electricity for 6 cents per kilowatt-hour, compared to electricity from natural gas and coal plants which cost an estimated 6.4 cents and 9.6 cents per kilowatt-hour, respectively, according to the US Energy Information Agency.

So is solar power set to replace coal? Not so fast, says Christopher Helman, a Forbes columnist who researched the topic last year.

According to Helman, even though solar has grown rapidly in the U.S. over the past decade, it is still a relatively small part of the country's overall energy mix.

Still, if the cost of solar energy continues to drop, coal will certainly struggle to remain relevant and competitive, especially in developing countries like the U.S. where politicians are imposing increasingly stringent regulations on coal-fired power plants that are sure to squeeze margins even further. Even in less developed countries and economic powerhouses like India and China, which have driven the demand for coal, there is a movement afoot to limit use of the fossil fuel. As the Guardian reported recently, "China’s coal imports fell by nearly half in the first three months of the year as the slowing economy and tougher rules on pollution took their toll," with imports from the world's biggest coal consumer falling 42 percent from the same period a year ago.

China has said it will ban coal use in smog-cloaked Beijing by 2020. Last month, the city closed a 400-megawatt coal-fired power plant in the downtown area, replacing it with a gas-fired plant to cut pollution, China Daily said. Another 93-year-old coal power plant was shuttered the day earlier.

source: http://www.mining.com