Beginning with the surge in coal use which accompanied the Industrial Revolution, energy consumption has steadily transitioned from wood and biomass to fossil fuels. The early development of solar technologies starting in the 1860s was driven by an expectation that coal would soon become scarce. However development of solar technologies stagnated in the early 20th century in the face of the increasing availability, economy, and utility of coal and petroleum.

The 1973 oil embargo and 1979 energy crisis caused a reorganization of energy policies around the world and brought renewed attention to developing solar technologies. Deployment strategies focused on incentive programs such as the Federal Photovoltaic Utilization Program in the US and the Sunshine Program in Japan. Other efforts included the formation of research facilities in the US (SERI, now NREL), Japan (NEDO), and Germany (Fraunhofer Institute for Solar Energy Systems ISE).

Between 1970 and 1983 photovoltaic installations grew rapidly, but falling oil prices in the early 1980s moderated the growth of PV from 1984 to 1996. Photovoltaic production growth has averaged 40% per year since 2000 and installed capacity reached 10.6 GW at the end of 2007, and 14.73 GW in 2008. Since 2006 it has been economical for investors to install photovoltaics for free in return for a long term power purchase agreement. 50% of commercial systems were installed in this manner in 2007 and it is expected that 90% will by 2009. Nellis Air Force Base is receiving photoelectric power for about 2.2 ¢/kWh and grid power for 9 ¢/kWh.

Commercial concentrating solar thermal power (CSP) plants were first developed in the 1980s. CSP plants such as SEGS project in the United States have a levelized energy cost (LEC) of 12–14 ¢/kWh. The 11 MW PS10 power tower in Spain, completed in late 2005, is Europe's first commercial CSP system, and a total capacity of 300 MW is expected to be installed in the same area by 2013.

In August 2009, First Solar announced plans to build a 2 GW photovoltaic system in Ordos City, Inner Mongolia, China in four phases consisting of 30 MW in 2010, 970 MW in 2014, and another 1000 MW by 2019. As of June 9, 2009, there is a new solar thermal power station being built in the Banaskantha district in North Gujarat. Once completed, it will be the largest solar power plant in the world.

World's largest concentrating solar thermal power stations
Technology type Name Country Location
354 parabolic trough Solar Energy Generating Systems USA Mojave desert California
75 parabolic trough Martin Next Generation Solar Energy Center USA near Indiantown, Florida
64 parabolic trough Nevada Solar One USA Las Vegas, Nevada
50 parabolic trough Andasol 1 Spain Granada
20 solar power tower PS20 solar power tower Spain Seville
11 solar power tower PS10 solar power tower Spain Seville

Solar power plant installations in recent years have also begun to expand into residential areas, with governments offering incentive programs to make "green" energy a more economically viable option. In Ontario, Canada, the Green Energy Act passed in 2009 created a feed-in-tariff program that pays up to 80.2¢/kWh to solar PV energy producers, guaranteed for 20 years. The amount scales up based on the size of the project, with projects under 10KW receiving the highest rate. (People participating in a previous Ontario program called RESOP (Renewable Energy Standard Offer Program), introduced in 2006, and paying a maximum of 42¢/kWh, were allowed to transfer the balance of their contracts to the new FIT program. The program is designed to help promote the government's green agenda and lower the strain often placed on the energy grid at peak hours. In March, 2009 the proposed FIT was increased to 80¢/kWh for small, roof-top systems (≤10 kW).

World's largest photovoltaic (PV) power plants
Name of PV power plant Country DC
Olmedilla Photovoltaic Park Spain 60 85 0.16
Strasskirchen Solar Park Germany 54 57
Lieberose Photovoltaic Park Germany 53 53 0.11 2009
Puertollano Photovoltaic Park Spain 50

Moura photovoltaic power station [68] Portugal 46 93 0.16 Completed December 2008
Kothen Solar Park Germany 45

Finsterwalde Solar Park Germany 42

Waldpolenz Solar Park[69][70] Germany 40 40 0.11 550,000 First Solar thin-film CdTe modules. Completed December 2008
Planta Solar La Magascona & La Magasquila Spain 34.5

Arnedo Solar Plant Spain 34

Completed October 2008
Planta Solar Dulcinea Spain 31.8

Completed 2009
Merida/Don Alvaro Solar Park Spain 30

Completed September 2008
Planta Solar Ose de la Vega Spain 30

Planta Fotovoltaico Casas de Los Pinos Spain 28

Planta Solar Fuente Alamo Spain 26 44

DeSoto Next Generation Solar Energy Center[71][72] USA 25 40
SunPower. President Obama visited October 27, 2009. Completed October 2009
Financial incentives supporting installation of solar power generation are aimed at increasing demand for solar photovoltaics such that they can become competitive with conventional methods of energy production. Another innovative way to increase demand is to harness the green purchasing power of academic institutions (universities and colleges). This has been shown to be potentially influential in catalyzing a positive spiral-effect in renewables globally