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Wed Sep 30, 2015, 11:01 PM

Price of Solar Energy in the United States Has Fallen to 5¢/kWh on Average

(Please note: US Federal research lab press release. Copyright concerns are nil.)

https://newscenter.lbl.gov/2015/09/30/price-of-solar-energy-in-the-united-states-has-fallen-to-5%c2%a2kwh-on-average/
[font face=Serif][font size=5]Price of Solar Energy in the United States Has Fallen to 5¢/kWh on Average[/font]
[font size=4]Berkeley Lab study reveals 70% decline in PPA prices since 2009[/font]

News Release Jon Weiner 510-486-4014 • September 30, 2015

[font size=3]Solar energy pricing is at an all-time low, according to a new report released by Lawrence Berkeley National Laboratory (Berkeley Lab). Driven by lower installed costs, improved project performance, and a race to build projects ahead of a reduction in a key federal incentive, utility-scale solar project developers have been negotiating power sales agreements with utilities at prices averaging just 5¢/kWh. These prices reflect receipt of the 30% federal investment tax credit, which is scheduled to decline to 10% after 2016, and would be higher if not for that incentive. By comparison, average wholesale electricity prices across the United States ranged from 3 to 6 cents/kWh in 2014, depending on the region.

Key findings from Berkeley Lab’s latest “Utility-Scale Solar” report – which each year draws upon large volumes of empirical data to identify key trends in project costs, performance, and pricing among ground-mounted solar projects larger than 5 megawatts (MW) – include the following:

* Installed project costs have fallen by more than 50% since 2009. Median up-front project costs have dropped from around $6.3/W in 2009 to $3.1/W for projects completed in 2014. Some projects built in 2014 were priced as low as $2/W, and the 20th percentile of the sample declined sharply from $3.2/W in 2013 to $2.3/W in 2014. (All numbers are reported in AC watts and 2014 dollars.)

* Newer solar projects generate electricity more efficiently. Projects completed in 2013 performed at an average capacity factor of 29.4% (in AC terms) in 2014 – a notable improvement over the 26.3% and 24.5% average 2014 capacity factors realized by projects built in 2012 and 2011, respectively. This improvement among more-recent project vintages is due to a combination of several trends: newer projects have been sited in better solar resource areas on average, and have increasingly oversized the solar collector field and/or employed tracking technology to increase energy capture.

* Solar power purchase agreement prices have fallen to new lows, making solar an increasingly cost-competitive option for utilities. The improvements in up-front installed costs and capacity factors mentioned above have helped to drive power purchase agreement (PPA) prices to new lows, with PPAs now regularly being signed at prices of 5 cents/kWh or less. Particularly in the Southwest where the solar resource is strongest, there appears to be a deep market at these low prices, as evidenced by several recent utility solicitations for solar energy that have been heavily oversubscribed, with many of the unsuccessful projects offering prices similar to the winning projects. Declining PPA prices have also made utility-scale solar increasingly competitive outside of the traditional stronghold of the Southwest, with recent contract announcements in states like Arkansas (at ~5 cents/kWh) and Alabama (at ~6 cents/kWh) that have not previously seen much solar development.



* A strong pipeline of projects under development reflects utility-scale solar’s increasing competitiveness. There were nearly 45,000 MW of solar capacity making their way through various interconnection queues across the country at the end of 2014 – more than five times the installed capacity base at the time. In another sign of a broadening market, much of the new solar capacity that entered these queues in 2014 is located in regions outside of California and the Southwest, such as Texas and the Southeast. Though not all of the capacity in these queues will ultimately be built, presumably most of those projects that are able to proceed will try to reach commercial operation prior to 2017, when the 30% federal investment tax credit is scheduled to decline to 10%. This looming deadline suggests a frenzied pace of construction over the next 15 months – as well as a wealth of new data to analyze in future editions of this report.

This work was funded by the U.S. Department of Energy’s SunShot Initiative within the Office of Energy Efficiency and Renewable Energy.

# # #

Lawrence Berkeley National Laboratory addresses the world’s most urgent scientific challenges by advancing sustainable energy, protecting human health, creating new materials, and revealing the origin and fate of the universe. Founded in 1931, Berkeley Lab’s scientific expertise has been recognized with 13 Nobel prizes. The University of California manages Berkeley Lab for the U.S. Department of Energy’s Office of Science. For more, visit www.lbl.gov.

DOE’s Office of Science is the single largest supporter of basic research in the physical sciences in the United States, and is working to address some of the most pressing challenges of our time. For more information, please visit science.energy.gov.

Additional Information: The full report (“Utility-Scale Solar 2014”), a PowerPoint briefing that summarizes the report, and an Excel workbook that contains much of the data presented in the report, can all be downloaded from: utilityscalesolar.lbl.gov/ In addition, a webinar covering key findings will be held at 2 PM eastern on Wednesday, September 30. To register for the webinar, please visit: https://cc.readytalk.com/cc/s/registrations/new?cid=yjrypmiauu4a

Technical contacts: Mark Bolinger (603-795-4937) and Joachim Seel (510-486-5087)[/font]

Updated: September 30, 2015[/font]

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Reply Price of Solar Energy in the United States Has Fallen to 5¢/kWh on Average (Original post)
OKIsItJustMe Sep 2015 OP
yeoman6987 Sep 2015 #1
OKIsItJustMe Sep 2015 #2
SheilaT Sep 2015 #3
OKIsItJustMe Sep 2015 #4
SheilaT Oct 2015 #5
OKIsItJustMe Oct 2015 #6
SheilaT Oct 2015 #8
OKIsItJustMe Oct 2015 #10
SeattleVet Oct 2015 #7
SheilaT Oct 2015 #9
OKIsItJustMe Oct 2015 #11
SheilaT Oct 2015 #12

Response to OKIsItJustMe (Original post)

Wed Sep 30, 2015, 11:11 PM

1. I'd love solar panels on my roof

 

My neighbors have them. They cost 30 grand but got 18 grand back. 12 grand is still steep when air/heating system has about a year left and roof maybe 10 left max.

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Response to yeoman6987 (Reply #1)

Wed Sep 30, 2015, 11:46 PM

2. Maybe you should let someone else put them on your roof

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Response to OKIsItJustMe (Original post)

Wed Sep 30, 2015, 11:49 PM

3. Oh, my.

 

I live in New Mexico, land of sunshine. Several years ago when my oldest son visited he asked, "Where are the solar panels?"

There aren't any, or not very many here. Recently I was chatting with a man who is working to install solar panels, and discovered two problems. One is that most of our roofs in Santa Fe, where I live, are flat. The panels the company he works for are designed to be put on pitched roofs. The other is that if your electric bill isn't at least $100/month, forget it. It's not financially feasible to install the. I live in a small (900 sq ft)home, and I pay around $50/month for my electric. Small home, no a/c. It's nice to have such a low utility bill.

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Response to SheilaT (Reply #3)

Wed Sep 30, 2015, 11:56 PM

4. Can you contract for utility solar?

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Response to OKIsItJustMe (Reply #4)

Thu Oct 1, 2015, 12:00 AM

5. Perhaps I should look into it.

 

But unless someone else is going to underwrite the cost of the solar panels, I seem to be better off sticking with conventional electrical utilities.

Eventually places like NM will be totally solar, I've no doubt.

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Response to OKIsItJustMe (Reply #6)

Thu Oct 1, 2015, 01:57 AM

8. What I think it comes down to is that my electric bill is

 

so astonishingly low, that given the current system, I can only save money if I go off the grid. Which I have no intention of doing.

Right now, the cost of installing solar panels is rather steep. Eventually, they will be part of the infrastructure, as is hookup to water is currently in any city. Until the, I'm not willing to fork over tens of thousands of dollars to save maybe twenty bucks a month.

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Response to SheilaT (Reply #8)

Thu Oct 1, 2015, 08:21 AM

10. For me, it’s not about saving money

It costs me more to purchase renewable power.

Since your bills are so astonishingly low, I’m willing to bet you could afford to pay just a little bit more, to help try to save the planet.

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Response to SheilaT (Reply #3)

Thu Oct 1, 2015, 12:16 AM

7. Are there local sources for solar financing?

Here in Seattle (where solar works quite well, thank you!) one of the local banks specializes in green projects, and has very low interest rate loans for solar/wind home installations.

Flat roof shouldn't be a problem, if they have the right mounting brackets. The brackets will separate the panels and give them the tilt to approximate a pitched roof.

As far as the bills, check to see if your local utility does 'net metering'. We have that here, and we sell excess production to the local power company at a rate that exceeds what we pay per kilowattHr. We sold a significant amount last year - essentially we will not have to pay an electricity bill for the next several years.

If we could do this in Seattle there should be some local programs you could take advantage of.

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Response to SeattleVet (Reply #7)

Thu Oct 1, 2015, 02:00 AM

9. My understanding is that the one solar company

 

currently willing to install panels only does so on pitched roofs. Almost every single roof in Santa Fe is flat. Fifty bucks a month is practically nothing. I think that is the lowest of all my utilities: internet/phone, water/sewage, and gas. Well, actually the gas bill is much lower during the summer, but rises quite a bit during the winter. If solar energy also gave me heat, it would start being cost effective. Until then, everything is copacetic.

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Response to SheilaT (Reply #9)

Thu Oct 1, 2015, 08:32 AM

11. I think, if you want to install your own panels, you should do a little research

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Response to OKIsItJustMe (Reply #11)

Thu Oct 1, 2015, 02:43 PM

12. Doing a bit of quick on-line research,

 

it just doesn't look as if at the present time installing solar makes a lot of sense for me, unless someone else underwrites the majority of the cost. Again, I have a pretty low electric bill, fifty dollars or less every month. As solar panels become more efficient and as the cost of them goes down, at some point it'll make sense. But not yet.

If I were building a new home here, I'd definitely do solar as it would absorb into the cost of the home quite nicely.

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