What Are Low Oil Costs Doing To Solar Demand

These historically low oil prices must be negatively affecting demand for solar power and other renewable energy sources. Right?

Not so fast.

Even though the current oversupply of oil should continue for the foreseeable future, demand for renewable energy sources is still growing.

How could this be?

For starters, oil supply is still (rightfully) perceived as being volatile. Investors recognize that the current dip is not a permanent situation.

Renewable energy sources will provide steady supplies -- none of the supply or price fluctuations of natural resources.

Additionally, the two energy sources have very different uses. Oil is primarily used to fuel transportation needs, while renewable sources tends to create electricity. So a decrease in demand for one does not cause an increase in the other.

The duration of the oil oversupply remains to be seen, but it seems like a safe bet that interest in solar and renewable energy sources will not be affected too adversely.

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