About a year ago I introduced you to the world of thin-film solar – the next evolution of solar technology that could single handedly bring the cost of solar down to a competitive level.

About 4 months ago I reported to you from the Renewable Energy Finance Forum, that word within VC circles was that very soon, thin-film would be coming up on a much larger scale. And these guys were lining up at the door with truckloads of money...just trying to get a piece of the action while the getting was still good.

Well, last week you may have received a letter from me regarding a profitable publicly-traded solar company that's expected to take 15 to 20 percent of the solar equipment market by 2010.

Sine my initial recommendation, the stock has risen more than 12%. And it pays a dividend!

If you’d like to know more about this lucrative thin-film play, you can read more about it here.

But in the meantime, let me show you the #1 reason why savvy investors tapping the thin-film solar market now are about to clean up.

Welcome to the Dawn of Competitive Solar

A friend of mine just installed a new solar PV system at his home in western Maryland.

Including the tax breaks, the system ran him about $85,000.

Certainly not a cheap investment.

Of course, he’s a hot shot lawyer with the kind of hefty billable hours that make an investment like this pretty easy to pull off. But for most Americans, $85,000 can be pretty hard to come by.

So I’m rarely surprised when investors tell me I’m crazy for being so bullish on solar when the stuff is just so damn expensive.

Who can afford it?

Well, a lot more people can afford it today than twenty years ago. That’s for sure.

Look at it like this…

The price of solar modules in 1982 ran about $27 per watt. Today, according to the most recent numbers, the lowest retail price for a multicrystalline silicon module is $4.05 per watt.

And with advances in thin-film solar technology, we could be looking at $1.75 per watt by 2010.

Even better, the thin-film company I recently recommended is banking on reducing the cost per watt to $1.00.

Welcome to the dawn of competitive solar!!!

The ‘What if’ Scenario

Over the past few years I’ve been faced with the same exact question, over and over again. I’ve actually had to answer this question so many times – I’ve dubbed it the ‘what if’ scenario.

‘What if’ oil prices fall back down to $30 a barrel?

Well, despite the recent drop in oil prices, I wouldn’t get too comfortable.

Eased tensions in the Middle East…lack of catastrophic hurricanes or Acts of God to rip sections of our energy infrastructure apart…questionable finds in the Gulf of Mexico – this stuff is all temporary!

Even the EIA is predicting an average of near $70 for the rest of the year. Though I’m betting it exceeds $70.

Nonetheless, current oil prices are splitting the pack when it comes to solar investors.

Some have chosen this time to run from solar (those are the ones who spend more time chasing trends than making any money) and some have chosen to use this opportunity to pick up some of these stocks, as many are now priced more favorably than they’ll be once oil cranks back up over $70.

In fact, a number of the top solar performers this year are now priced between 35 and 45 percent below their 2006 highs. One of our favorites…Evergreen Solar (ESLR:Nasdaq) can be counted among those.

And we believe Evergreen, just like many of the other major solar players, is in line to pick up at least half of what it lost over the summer by late 2006, early 2007 – and, depending how high oil gets next year…will most likely maintain a slow, but steady growth up to and beyond 2010.

Of course, those looking to diversify their solar plays would be wise to tap the thin-film market now – while there’s still an opportunity to get these things at such a low price too.

Point is…we’re not looking at the recent dip in oil prices as an indicator of solar’s demise – but rather an opportunity to load back up on solar while oil prices take a break…and solar stocks are reasonable buys again.

You can read more about the future of solar markets, and my latest thin-film solar recommendation here .