PARITY

Parity describes the point at which the price of electricity generated from renewable energy sources equals the price of electricity from fossil fuels. Often referred to as grid parity, proponents of renewables have long considered it a key objective for the industry, as its achievement would signal that renewable energy can compete with fossil fuels. Grid parity is a powerful concept because electricity is a commodity. Consumers of electricity, including households, businesses, and industry, have shown a propensity to switch the source of power generation from fossil fuels to renewables when the price is equal to or lower than what