Solar power has reached the point where, for ordinary consumers, it's generally about the same price as power from the electric company.
Wind energy has reached the point where, for utilities, it's generally about the same price as generating power from fossil fuels.
Not surprisingly, then, both residential solar and utility wind power are growing very fast in the U.S. I've seen some analysis showing that essentially all the net new generating capacity being built in this country is coming from renewable sources. I don't know how credible this is, but whether it's true or not today, it will be true in the not very distant future.
Solar and wind energy can continue to grow like this for many years, since they still represent a very small portion of our total electric generation. But the growth of renewable energy will eventually be limited by the fact that these energy sources are inherently intermittent. The sun doesn't always shine, and the wind doesn't always blow, and there's no way to control when you get power.
The problem is that electricity needs to be generated at the same time it is consumed. The power grid doesn't store power, it just moves it from one place to another.
Right now, storing electricity is a lot more expensive than generating it. In our neighborhood, it costs about $0.12/kWh to buy power from the electric company. Rechargeable batteries, on the other hand, cost (on the cheap end) around $0.50 for every kWh you use because the battery has a limited number of charge cycles before it needs to be replaced.
Given the cost of storage technology today, it is almost never economical to store excess renewable power for later use, even if the power is free (the only exception is if there are no other power generation options available--for example, a cabin in the woods). That means that, with today's technology, wind and solar power can't supply anything close to the majority of our electrical needs, since the power simply won't be generated at the right time.
An inexpensive way to store excess power for later use would radically change the economics of renewable energy. Lots of smart people are working on this problem, and there are several different approaches which could bear fruit.
Traditional batteries are the simplest way to store electricity for future use, but today's technology is simply too expensive for large quantities of power (except in specialty applications like electric cars). There's a lot of research into novel chemistry, better physical designs (including lots of nanotechnology), refinement of approaches like flow batteries, and so forth.
In order to become economical, there needs to be at least an order of magnitude improvement in the cost of large batteries per lifetime kWh (where the lifetime kWh is the capacity of the battery multiplied by the number of charge cycles before the battery has to be replaced). The good news is that there doesn't seem to be any fundamental limitation to getting there--it's possible to build rechargeable batteries from relatively cheap and abundant raw materials. The bad news is that the cost of battery technology seems to be dropping only relatively slowly, and it will take a long time to cut the price by an order of magnitude without a major breakthrough.
There have also been a lot of novel energy storage approaches proposed, including:
These techniques are certainly able to store energy and make it available on demand. Bringing them up to utility-scale (or even power-a-house scale) is a challenge, though. Pumping water and compressing air are both relatively inefficient and only work in certain geographical locations. Flywheels, compressed air, and supercapacitors have a safety issue, in that if Something Goes Wrong they can release a huge amount of energy uncontrollably fast (that is to say, they can explode). To my knowledge, none of these schemes has made it past small scale pilots, though they sound promising on paper.
One really intriguing approach is to find a chemical process which can be used to produce liquid fuel using electricity, and using the fuel produced to power vehicles or electric generators for times when the renewable power isn't available.
This is attractive for several reasons:
If I had to guess, I would say that this is the approach most likely to win over the very long term (50+ years). There are a lot of people researching ideas in this space, but to my knowledge nobody has come up with something cheap enough at large scale. On the other hand, there are almost an infinite number of chemical possibilities, and the reward for cracking this puzzle will be immense.
The simplest and cheapest way to store power for later use is through demand shifting, adjusting when you use power to match when it's most readily available. One of the biggest consumers of power in a typical home is heating and cooling, including not just the home itself but also hot water, refrigerators, air conditioners, and so forth.
Heat (and cool) are fairly easy to store for up to a day or two. For example, thermal storage heaters (which have been available for decades) use off-peak electricity to heat up a pile of bricks, and then blow the heat into the room throughout the day as needed. Similarly, an off-peak hot water system can heat extra hot water when electricity is cheap for use at other time.
Along the same lines, freezers can get extra cold when there's cheap electricity available (so they don't have to run as much at other times), and an air conditioner could chill a pile of bricks or tank of water to make cool air available at other times.
Using tricks like this, it's probably possible to move 75% (or maybe more) of the electrical use of a typical American home to times when renewable power is available. Other appliances (clothes washers, phone chargers, etc.) can be programmed to mostly run when there's solar or wind.
The beauty of this approach is that it requires no new technology, and has the potential to dramatically increase the amount of our power consumption which could be met with solar or wind power. The downside is that it will require changes to almost any electrical device which can be demand-shifted, and a lot more intelligence in our power systems. But those changes can happen gradually.
It's not unreasonable to think that with aggressive demand-shifting and only a modest amount of battery storage (for lights, computers, and entertainment systems), a typical home could be built with solar power and be off-grid for close to the cost of grid power.