Something is going on in the solar sector ? (I)

Some days ago, while I was reviewing some fundamentals, I realized that solar companies are doing great, generating increasing earnings and profits. That make me think about it, the reasons behind, and  try fo figure the future of this sector. I found some interesting points in boh positive and negative side.

On the positive:

New boom in renewables: Only in 2010 investments in them increased by 32%, and expectations are they are going to keep growing.

Old energy problems: Take pollution and Fukushima as examples.

Lowering Costs: cost have decreased by 75% in 2 years.

Good popular conception: Contamination conception and nuclear dangers are in everyone's minds.

Coming CO2 taxes: going to be another point of convergence profitability between old and new energy types.

As for the negatives:

Regulatory issues:  Still dependent on government subsidies, and tye real threat of cuts in all kind of spending, which brings to the important next point.

Lack of Competitiveness by its own: Completely dependant on government which gives it with no control of their financial situation

Increasing extraction of shale oil&gas: If this new methodology keep oil prices out of new surges, this would increase its competitiveness. However, not expect in oil price path seen in gas in recent years.

My Conclusion: While it can be clearly one of the important energy plaeyr in future, clearly, is not going to be tomorrow, as it has to solve some important themes.The day solar can compete versus other energy types without interventions, we'll be talking about one of energy kings. I think there's still a long way ahead.

In the second post, I'll talk about investement ideas and ways to play it.