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Solar at 2.99 cents/kWh May 5, 2016

Posted by Maury Markowitz in Uncategorized.
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-1x-1

Down, down, and away!

I guess this is starting to sound a little repetitive, but yet another record has been set for solar PV – at a whopping 2.99 cents/kWh, well down into the range of unfiltered coal plants or high-quality hydro. Now again, this is in Dubai, which tends to be sunny, but, again, that’s like complaining we built hydro where there’s a river.

Now you might want to dismiss this number because it’s Dubai. But only last month another contract was signed at 3.45/kWh in Mexico, and it was only a few months ago that everyone was stunned by the Saudi and Nevada numbers at 5.85. That means the price has fallen almost 50% in the last year.

Now whether this is simply because of a temporary oversupply situation in China I can’t say, but it doesn’t make a difference. Solar is now cheaper than coal, and from here out, always will be. Welcome to that future everyone was talking about in the 70’s.

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2015 PV prices hit new lows in the US March 30, 2016

Posted by Maury Markowitz in solar, Uncategorized.
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solarpvpricing-2015

Down, down, and away!

Most of the data on PV pricing, like the Lazard numbers I prefer, tend to focus on larger installations, especially “utility scale”. In the US this isn’t all that useful on its own, because about half of all the panels going in are on residential rooftops. So that’s why this report is so useful.

Basically the price declines in larger installs remains as breathtakingly rapid as it has been for years, including a whopping 17% in 2015 alone. But those residential numbers are looking pretty plateaued to me. So let’s see what this means.

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PV at 4 cents October 15, 2015

Posted by Maury Markowitz in solar.
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Image of a typical First Solar ground mount installation

The project will likely use FS’s unique thin-film panels.

During the summer, Warren Buffett’s NV Energy in Nevada signed a long-term power purchase agreement (PPA) for 20 years at 3.87 cents a kilowatt-hour. This is for PV generated by First Solar’s 100-megawatt Playa Solar 2 installation.

This means that FS is generating that power, including tax breaks, at less than 4 cents/kWh. Those breaks account for less than 2 cents. The Nevada Public Utilities Commission called the rates “very reasonable”, having outcompeted all other bids including NG turbines. Understatement indeed!

This isn’t the only example. NV Energy signed a similar deal with SunPower’s Boulder Solar at an equally eyewatering 4.6 cents only last year, and Dubai’s 200 MW plant, the first major one in the country, is at  5.85 cents, and the Saudi’s at 4.9 cents. The prices in those areas will go down as the supply chain improves.

Now of course all of these are in sunny locations with few clouds, which some will complain about. But that’s like complaining you build hydro where there’s a river. And prices continue to fall. Even if the US tax credits expire, which they will sooner or later, PV will compete even on the utility side of the meter pretty much anywhere south of the Mason-Dixon.

Widespread grid parity is here February 11, 2014

Posted by Maury Markowitz in power grid, solar.
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I’ve posted on the concept of “grid parity” in the past.

Basically the concept is that if the interest payments on your panels are less than what you’d pay to the power company for the same amount of power, you’re at  parity.

The industry has long been predicting that we would hit parity at some point. Most of them suggested this would happen around 2020. It came early.

We are clearly at grid parity for most of Canada today. And that means it’s also true anywhere south of us, and most of Europe.

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Grid parity, New Mexico style June 10, 2013

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I just came across a short article on a recent deal signed between El Paso Electric Power and First Solar for a 50 MW PV plant in New Mexico. The key point here is the power purchase agreement (PPA) was signed at 5.79 cents/kWh. See this document for details.

Who knows what backroom dealings went into this agreement, and it’s impossible to say whether or not this represents any sort of reasonable price point moving forward. But none of that makes a difference. What we’re looking at here is what appears to be the first example of “Grid Parity of the Third Kind”, parity on the wholesale side of the wire, as opposed to the retail side.

5.79 cents is more than we pay for some wholesale power here in Ontario, which varies from 1.9 cents/kWh as the average grid rate, but have real payouts as high as 8.53 cents/kWh at Pickering A (and 5.36 at Pickering B) down into the 2 cent range for some of its hydro assets.

It’s a funny world we live in when PV plants are signing PPAs at the same rates as nuclear stations!

Grid parity in Ontario April 17, 2013

Posted by Maury Markowitz in FIT program, solar.
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Talking to several local installers, I’m finding that 10 kW microFIT systems can go in at as little as $32,000, fully commissioned. In power-industry lingo, that’s $3.20 a watt (update: I’ve since seen $2.60!). And if you’re not on microFIT and don’t need Ontario content, you can cut another 20 cents off that.

The effective cost of electricity from solar PV is basically a function of the cost of the system and pretty much nothing else. So what rate do we get when we plug in 3.20 a watt into a calculator? You get 16.6 cents/kWh. And what do you get if you plug the current 12 cent average rate for power off the grid? 17 to 20 cents.

So that’s that. We’ve hit grid parity in Ontario.

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