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Clean Power Photo courtesy First Solar

Published on April 6th, 2012 | by Andrew

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Solar, Renewable Grid Parity, or Better, in California’s Latest Renewable Power Auction

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April 6th, 2012 by  

Photo courtesy First Solar

Yes, that’s right: grid parity is here, well here being California in this instance. The weighted average highest cost of solar and other renewable power contracts accepted by California utilities in the state’s Renewable Auction Market (RAM) auction amounted to 8.9 cents per kilowatt-hour (kWh) for 20-year power purchase contracts, the Vote Solar Initiative reported March 30. Though this doesn’t include transmission costs, $0.089/kWh is well below the average residential electricity cost of 15 cents per kWh in California in 2011, and that’s the weighted average highest cost of the accepted offers to the state’s electricity distributors.

Reaching grid parity– where the cost of electricity generated from solar power equals that from conventional, longstanding grid sources such as natural gas and fossil fuel power plants– has long been held up as a major milestone, and pivotal achievement, in the solar, renewable energy and power communities.

Achieving grid parity has come faster than many expected. The decline in the cost of solar power has been rapid, exceptionally rapid, especially in California, which has been leading the US movement away from using coal and fossil fuels to generate electricity by fostering the development and adoption of renewable energy resources.

A Solar and Renewable Energy Milestone Reached in California

It may have even come too fast. The combination of California’s market-based incentive programs, such as its RAM and Feed-in Tariff (FiT), and its Renewable Portfolio Standard (RPS), along with federal government subsidies and China’s massive manufacturing and export subsidies of crystalline silicon (c-Si) solar photovoltaic (PV) cells and panels boosted both the supply and demand for solar power systems. Sustaining costs at grid parity levels or better poses a stiff challenge to solar power industry participants, as one or more of these struts is removed.

Of course, the cost-of-electricity playing field isn’t level by any means, which actually makes California solar power reaching grid parity an even greater achievement. Coal, natural gas and nuclear power plants have benefited from government subsidies many times the size and for decades more than those that have been granted to comparatively new solar and renewable power producers.

Another significant factor that needs to be considered when comparing the cost of new solar power and other renewable power resources to established conventional power plants is production and transmission infrastructure– coal, natural gas and nuclear power plants have it; solar and other renewable power plants need to build it, or rely on others to build it.

Coal, natural gas and nuclear power plants have been in place for decades. The huge, upfront capital costs of building them has been, or is being, amortized. Transmission lines delivering the electricity they produce for distribution is in place and long-established. Being new, that’s not the case with solar power arrays and farms, whose costs are higher and margins lower as a result.

California’s Renewable Auction Mechanism

California’s RAM aims to promote and foster distributed renewable power generation. As explained by the California Public Utilities Commission (CPUC), RAM is “a simplified and market-based procurement mechanism for renewable distributed generation (DG) projects up to 20 MW on the system side of the meter.”

The CPUC has designed and established the Renewable Auction Mechanism to streamline “the procurement process for developers, utilities, and regulators. It allows bidders to set their own price, provides a simple standard contract for each utility, and allows all projects to be submitted to the CPUC through an expedited regulatory review process.” The aim, CPUC goes on is “to promote competition, elicit the lowest cost for ratepayers, encourage the development of resources that can utilize existing transmission and distribution infrastructure, and contribute to RPS goals in the near term.”

With all this in mind, let’s move on and take a look at the RAM results as known so far. California utilities had accepted a total of 145 MW of renewable power offers in the state’s RAM auction, according to Vote Solar’s April 5 update.

California’s RAM Results

Here’s a summary of what Vote Solar’s dug out and posted on their blog, along with hyperlinks to the utilities’ original advice letters asking for approval of the 20-year power purchase agreement contracts:

Southern California Edison (SCE):

  • Received 92 offers totaling more than 1200 MW, 91 were for solar PV
  • Accepted 7 offers totaling 67 MW, all solar PV
  • Winning contracts by capacity: two 20 MW; one 12 MW; one 9 MW; three 2 MW

Pacific Gas & Electric (PG&E):

  • Received 122 offers from 52 counterparties totaling 1470 MW
  • Accepted 4 contracts with a total capacity of 63 MW
  • Winning contracts by capacity: one 14 MW geothermal power plant; one 9 MW wind power project; two 20 MW solar PV projects

San Diego Gas & Electric (SDG&E):

  • Accepted two offers totaling 15 MW out of a total 32 submitted, most of which were in the 5-10 MW range
  • Silverado is the developer of both
  • Both are solar PV projects

Once approved by the CPUC, project developers have 18 months to bring their projects online.

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About the Author

I've been reporting and writing on a wide range of topics at the nexus of economics, technology, ecology/environment and society for some five years now. Whether in Asia-Pacific, Europe, the Americas, Africa or the Middle East, issues related to these broad topical areas pose tremendous opportunities, as well as challenges, and define the quality of our lives, as well as our relationship to the natural environment.



  • Rborlick

    Rooftop solar competes with the retail price of electricity?  Sure – until this regulatory “loophole” is abolished and retail rates are restructured to more accurately reflect the cost of service.  Smart meters will inevitably bring about the redesign of retail rates.  Then rooftop solar will have to compete with wholesale generators, which they cannot today or in the foreseeable future.  

    If you want to define “grid parity” to suit your own preconceived notions, go ahead and indulge yourself.  Fantasy can be a wonderful thing for cheerleaders.   

    • http://cleantechnica.com/ Zachary Shahan

      lol. i wonder why solar is growing exponentially in many places… guess people can’t do math.

      no worries. ride your horse to the nearest market. call your family on a phone connected to the wall. and type your next response on your typewriter and send it over.

      • Rborlick

        It’s growing exponentially because it is being subsidized by state regulators through nonsense like feed-in tariffs.  This is neither sustainable nor desirable.  

        The California PUC recently got slapped down by the FERC for violating the PURPA QF law.  

        • http://cleantechnica.com/ Zachary Shahan

          lol. Nothing to do with costs falling off a cliff! :D

          and, notably, FiTs aren’t subsidies. except in a *Very* loose sense of the word.

          furthermore, they’re supported by citizens! :D

          lol.

          • Rborlick

            Excuse me?  FITs are not subsidies?  Then why are they needed?  Any generator can sell its power at the prevailing market price.  

            FITs exist to provide a selected generator (e.g., rooftop solar or other DG sources) a price that exceeds the market price, i.e., it contains a subsidy component.  

            Now when you say they are supported by “citizens,” you are implying that the people paying the subsidies are doing so voluntarily.  That’s bull***t.  The subsidies are being forced on electricity customers through the monopoly power of the distribution utilities serving them.   

            Now we can debate whether this is good public policy, and how large these subsidies should be, but let’s not delude ourselves into believing that solar or wind energy is economically competitive with fossil energy today.  They aren’t.  

            Comparing the cost of rooftop PV with the host customer’s retail tariff is absolute nonsense – except to exploit what I have already pointed out is a regulatory loophole.   

          • http://cleantechnica.com/ Zachary Shahan

            What is the govt paying citizens when it comes to FiTs? What taxes are they passing over? That’s what i mean by saying it’s not a subsidy. Maybe it’s semantic, but if you’re going to be nit-picky…

            The German policy has been in place for a long time. And recent surveys still show residents saying they will pay more for clean energy. Don’t make this into an attack on citizens that it’s clearly not.

            And my point about grid parity is that it’s occurring many places now, and those places are expanding. If you want to get comprehensive with subsidies and be inclusive of FiTs, we should also be inclusive of externalities created by coal, natural gas, and nuclear. But my guess is that you don’t want to go down that road.

            The comment about wind is even more absurd. Look at the LCOE tab here — compare onshore wind to any other electricity source: http://en.openei.org/apps/TCDB/

            Comparing the cost of buying electricity or producing it yourself with solar panels is very practical for an end consumer. To claim otherwise is ridiculous.

          • Rborlick

            Zachary, 
            I have advanced degrees in electrical engineering, economics and finance theory.  I’ve also been involved in the electric power industry, both in the US and abroad, for more than 30 years.  I don’t know what YOUR professional credentials are; however, you have displayed an ignorance of the economics underlying the electric power industry.  You obviously have a point of view that conflicts with logical  argument.  That’s fine; you’re entitled to believe whatever you want, just as people have a right to believe the world is flat.  However, I’m not going to spend any more of my time trying to convince you otherwise.  This is my last post and I am unsubscribing from this website.  Let must say in closing that I stand by my original post which stated that this article is nonsense.  Achieving “grid parity” is unrelated to comparing the cost of a retail customer generating energy on-site vs. what he pays for electricity under his retail tariff because that tariff includes rate components that recover fixed transmission and distribution costs which are unrelated to the cost of generating energy.  G’day.

          • http://cleantechnica.com/ Zachary Shahan

            Good day to you, too.

            Again, you don’t need an advanced degree in anything to get to the root of grid parity — is it as cheap for someone to go solar as it is to buy electricity from the grid? I’m sorry that you still miss the end point.
            Now, if you actually wanted to get into the full costs (to determine if solar is getting propped up on subsidies artificially… or the opposite), you’d have to go beyond simple issues such as transmission and distribution costs. You’d have to get into a whole host of other costs and externalities. So, outright claiming that solar is being unfairly subsidized because of on piece of the subsidy pie is absurd.

            For starters on some of the other issues, see:

            http://cleantechnica.com/2011/06/26/true-value-of-solar-power/
            http://cleantechnica.com/2012/04/06/its-here-solar-renewable-grid-parity-or-better-in-californias-latest-renewable-power-auction/

            I’m surprised to hear that you were a CT subscriber (and wonder how long that might have been for). Your comments wouldn’t indicate that at all. They look like those coming from what is termed a ‘troll’ in the internet world (someone who pops in to cause trouble in the comments section and then dashes off – like an anti–clean energy person dropping long and incorrect comments on a clean energy site).

            I’m sorry that it wasn’t easier for you to cause trouble here (trying to leave the last, misleading word under a post), but we’re not a big fan of letting people deceive others on such matters here on CT.

            Enjoy your misguided attempt to convince people that solar power gets more subsidies than its dirty competitors, or that someone getting solar for cheaper than they’d pay for electricity isn’t, in essence, grid parity.

        • Bob_Wallace

          Would you please explain this?  “The California PUC recently got slapped down by the FERC for violating the PURPA QF law.”  

          • Rborlick

            All wholesale power transactions are regulated at the federal level by FERC.  A state can’t just unilaterally decide to impose a feed-in tariff on its utilities.  

            See the following link to get a quick and clear explanation of PURPA and how the CPUC was required to comply with it:  
            http://www.irecusa.org/2010/10/ferc-provides-clarification-on-feed-in-tariff-options-for-states/

          • Bob_Wallace

            I suspected that was what you were referencing.

            To claim that “The California PUC recently got slapped down” seems to me to be an overreach of the actual facts.

            The way CA had gone about setting feed-in tariffs was found to not be acceptable to the controlling body.  Seemingly because the justification used was the incorrect one.  The FERC redirected CA to continue with its feed-in tariff but under a different regulation.

            That’s my interpretation, but I’m no attorney and this is “deep in the weeds” stuff.

          • Rborlick

            Your interpretation of FERC’s order is a bit simplistic.  California is not free to set an FIT in just any way it chooses.  It has to comply with PURPA, i.e., the generator must be a “Qualified Facility” and the price in the tariff cannot exceed the utility’s avoided cost of purchasing power.  

            Now I will grant you that the FERC bent over backwards to accommodate the CPUC by allowing it to define avoided cost  in terms of a subset of generators from which the utilities must purchased to fulfill its renewable portfolio requirement.  In other words, the FERC allowed a set-aside for renewable energy, which of course is a subsidy and is also discriminates against non-renewable generation.  

            It’s not clear that this is legal under the Federal Power Act, which prohibits rates that are “unduly discriminatory.”  The only way to find out is for someone to sue the FERC and see what the courts think.  

            Yes, this stuff is “in the weeds” but the devil is always in the details. 

    • Bob_Wallace

      What regulatory “loophole”?

      • Rborlick

        Perhaps you didn’t read my first set of comments on this article, in which I stated: “Retail tariffs include the fixed costs of the distribution systems plus other fixed costs, such as”regulatory assets” (e.g., the cost of above-market QF contracts that were signed years ago under the CPUC’s standard offers).”

        If many owners of solar panels use them to reduce purchases (or sell back excess energy) under their retail tariffs the utility loses the contribution to its fixed costs that is built into the retail tariff design.  Once that loss becomes significant the utility (with approval from its regulators) will directly charge those fixed costs to the customer and lower the energy rate (at least in the tail block).  When that occurs the solar panels will compete with the wholesale price of electricity, as determined by the marginal generators, most likely gas-fired peakers and combined cycle plants because they set the hourly prices during daylight hours.  Thus, the investment in rooftop solar panels will need to be recovered by the savings (or revenues) from avoiding purchasing (or selling excess) energy at the hourly wholesale prices.    

        Now do you understand the nature of the regulatory loophole?  It is the current misplacing of electricity at the retail level.  As long as only a few people exploit  this loophole it can exist; when the exploitation becomes rampant the loophole will be closed.  If it isn’t the distribution utility will go bankrupt and the customers with rooftop solar will be off the grid (good luck with that). 
        Clean Technica (http://s.tt/18TUm)

        • Bob_Wallace

          Rooftop solar owners are wholesale providers.

          Utilities own the transmission lines which bring the power from all their providers, rooftop and peaker plant.  Those costs are already calculated into the mix.

          Utilities will not charge those costs back to rooftops any more than they do to peak plants.  Which is zero.

          Utilities will purchase the cheapest available power and since they can pay for rooftop at their lowest wholesale power price they will purchase all the rooftop they can get.

          Perhaps somewhere far, far out into the future enough retail customers will install enough generation (and storage) that utilities will need to adjust their retail prices some to cover fixed costs, but this is so far into the future than it is not worth considering at this time.  And it won’t matter to retail customers because it will be offset by not having to pay for peaker power and more expensive fossil fuel/nuclear power.

          (There will be some bumps in this simplified model because some utilities own non-dispatchable generation which will be financially hurt by cheaper rooftop.  We’re seeing pushback in Germany right now.)

          • Rborlick

            “Wholesale Providers?”  Since when?  

            In order to sell into the wholesale market a party must be a market participant.  Retail customers are generally not market participants but they could be if they are a   large C&I customer that buys directly from the grid.  But even an owner of rooftop solar is a market participant he is competing with wholesale generators, i.e. gas-fired CTs and CCGTs, so his retail tariff is irrelevant.  

            At least you are correct in stating that utilities will purchase electricity at the lowest price offered to them, which will be the wholesale market price.   Why would any generator sell for less?  Which gets us back to my original comments, which stated that rooftop solar must compete against the cost of gas-fired CT and CCGT energy, which is cannot today without substantial subsidies.  Germany is phasing out such subsidies as are other European countries because they can no longer afford them.  California will learn this lesson as well because the state is in a deep financial hole.  

          • Bob_Wallace

            In a simplified world there are only “wholesale providers”.  Utilities purchase at what we call the wholesale rate.

            There is no requirement that providers be paid for their power with dollars.  They can be paid with provided power at a different time or with a bag of beans.

            Germany’s average installed rate was $2.44/watt over a year ago.  With panel prices continuing to fall that price is likely lower now.  The US will catch up over time.

            As the price falls then subsidies can be phased out, which is what is happening.  It is not a matter of not being able to afford them, that’s bull.  It’s a matter of reaching a point at which force is being applied to drive down costs faster.

            Rooftop solar, large commercial rooftops, in CA and the rest of the US sunbelt is now $0.15/kWh.

            Are you aware of the cost of gas peaker power?  That is what rooftop is competing against.

          • http://cleantechnica.com/ Zachary Shahan

            Rborlick,

            1. you are off your rocker. you are stretching so far to try to make solar ‘nonviable’ that you really may as well be typing this on a typewriter and mailing it in.

            2. we’ve covered the FiT policy changes in European countries, writers from those countries have much of the time. these changes are happening mostly due to who is in political power. if you look past that essential first point, there’s really no point in discussing this with you. but, furthermore, as Bob notes, as the price of solar drops, the FiT was *supposed* to be reduced over time. Germany has gotten the price of solar down to about half what it is in the US! this has been a massive success, much better than almost anyone anticipated. the result: even without a FiT, solar would continue to grow fast in Germany.

            3. Are you lost? Or do you just come to sites that clearly won’t by your bull and decided to drop it in our comments anyway. WIth thousands of stories on solar power alone, do you actually think your tired, narrow-minded thinking on the matter is going to confuse us. Please, move along now.

  • Rborlick

    California is not going to unilaterally stop, or even significantly slow down climate change. It’s current renewables policy is merely going to cause an economic train wreck.

    • Bob_Wallace

      To stop global warming/heating from creating an immense problem it will take changes on the part of almost all of the planet. California is part of the planet. And California has generally been a leader when it comes to change.

      To say that switching to renewable is going to cause an economic train wreck is ignorant.

      Educate yourself.

      • David Fuchs

        Actually, with the cost of PV solar coming down so quickly it is going to cause an economic train wreck, for the large scale energy producers. 

        • Bob_Wallace

          Train wreck might be a bit strong of a descriptor.  But some derailments here and there….

          It is almost certainly going to be a disaster for those who have a lot invested in gas peaker plants.  Solar is going to produce “cheap for the grid” electricity exactly when those peaker plants were pulling down very large dollars for their power.

          It’s going to hurt other generation techniques (coal, nuclear, wind) that were enjoying nice returns due to merit order pricing.  The really high selling cost of gas peaker power pulls up the price for all other providers.

          Cheap rooftop solar will be the last nail in new nuclear’s coffin.  (Except places where nuclear is built with taxpayer money or by stealing money from customers.)  If new nuclear loses most of the night market to cheap wind and a fourth of the day to cheap solar there is no way it can exist.

          • Rborlick

            And you base your comments on what analyses???

            PV Solar has a LONG way to go before it can compete with a natural gas-fired combined cycle.  

            The last figures I saw for  rooftop solar indicated an installed cost of around $3000 per KW.  In contrast, a CCGT has an installed cost of about $800/KW (source: EIA).  Furthermore, Solar is intermittent and only achieves capacity factors of about 35 percent, whereas a CCGT can achieve capacity factors in excess of 85 percent.  Because solar is intermittent, it imposes the need for additional regulation/load-following ancillary services on the grid, the cost of which must be attributed to (and billed back to) the owners of the solar panels.  These are huge disadvantages to PV solar which will not be overcome anytime soon.  

            I do think that PV solar will ultimately be cheaper than nuclear and perhaps even CCGT plants (maybe by 2030) but it will not cause any “train wreck.”  Instead it will  gradually be phased in as a source of base load energy.  However it will never displace peaking plants, which gain most of their value from being dispatch able (which solar is not).  The only resource that has the capability to displace peaking plants is demand response.

            All of you cheerleaders do renewable energy a disservice because you all come off as a bunch of screwballs.  Be a little more realistic and people will take your pronouncements more seriously. 

          • Bob_Wallace

            Try to keep up Rborick.  I said ”
            Solar is going to produce “cheap for the grid” electricity exactly when those peaker plants were pulling down very large dollars for their power.”    Excess rooftop solar will flow to the grid at the wholesale price of the replacement power to the rooftop owners when the Sun has gone down.  Grab zero cost solar input and pay back with off-peak cheap wind/NG.

            Furthermore, solar will not be phased in as baseload.  Baseload is a misleading term and it falling out of use.  The task of grid managers is to provide power when it’s needed.  Thinking about “baseload” is a distraction because it calls into the process plants which rumble along 24/365 and there is likely to be any of that on the future grid.

            Then, PV solar does have a long time to go before it is as cheap as combined cycle gas, but when panels are hooked to the grid and the Sun comes out, those CCGT plants will shut down.  Gas costs money, sunshine doesn’t.

            Lastly, solar does not create a “need for additional regulation/load-following ancillary services on the grid, the cost of which must be attributed to (and billed back to) the owners of the solar panels”.  Rooftop solar will cause dispatchable fuel-cost generators to shut down, saving the grid and consumers money.

            Somewhere out in the future we are likely to see storage prices drop to the point where fossil fuels are totally pushed off the grid, but that’s many years out.

            These corrections brought to you by one of the screwballs….

          • http://cleantechnica.com/ Zachary Shahan

            you’ve got a lot of wild statements here that simply aren’t worth responding to. no point in arguing with someone who thinks the sky is orange.

            but a couple key points:

            1) rooftop solar competes with the retail price of electricity — it doesn’t need to compete with the wholesale cost of electricity from nat gas.
            2) people made claims like your making for years in Germany. now look at where the country is, and where it’s going. and plenty of people made the claim that landlines would be around/dominant forever. it’s hard for some people to see the future,… even when it arrives.

  • Rborlick

    Sorry to say but this article is complete nonsense.

    First off, it makes no sense to compare the busbar cost of renewables (or any other energy source) with a retail tariff. Retail tariffs include the fixed costs of the distribution systems plus other fixed costs, such as”regulatory assets” (e.g., the cost of above-market QF contracts that were signed years ago under the CPUC’s standard offers).

    The appropriate comparison is with the busbar cost of a new, natural gas-fired combined cycle plant (CCGT). Even assuming that gas prices return to the $4 per MMBTU level over the next 20 years the CCGT will produce electricity at about half the renewables price cited on this article. Furthermore, that price includes the effects of federal subsidies such as the production tax credit. Back that out and the renewables will look far more expensive relative to the CCGT.

    All this talk about the subsidies that nuclear and fossil fuel technologies is irrelevant. The subsidies that spurred their development are sunk costs and have no effect on today’s prices. Furthermore, the current subsidies for oil have essentially no effect on the “price at the pump” because those prices are largely set by the world price of crude oil. What the subsidies do is increase the profits of the oil companies. Taking them away (which the government should do to eliminate the loss in tax revenues) will not reduce pump prices. While one can credibly argue that renewables deserve similar subsidies to jumpstart the technologies, that is not the same as claiming they have achieved “grid parity” – that haven’t. And they most likely won’t for a long time.

    California’s goal of deriving 33 percent of its electricity from renewables by 2020. Is neither achievable nor sane. It is a prescription for burdening its electricity consumers with yet another tax that will further hobble the state’s economic development and ultimately its financial viability.

    The bottom line is that California can’t afford renewable energy. Jerry Brown and the CPUC needs to wake up to that fact.

    • Bob_Wallace

      Here’s the short and definitive reply –

      California cannot afford climate change.

      California cannot afford to replace its coastal cities and lose the income from agriculture.

  • Philbo

    Really good article.

    Nobody has mentioned or quantified the effect of millions of lobbying dollars spent by big oil coal and nuclear on disrupting the introduction of renewables. Buying the government has been a very fruitful source of revenue maintenance has anyone managed to come up with a legal/accounting term to cover it? Or is corruption simply put down to R&D or marketing maybe?

  • http://profiles.google.com/robtemery Robert Emery

    In reply to Mr Wallace: The original question was in reference to Solar PV. You people, Nimrods couldn’t answer the question and expanded it to subsidies and what ever else to confuse it. Watch What I Do to Your World

    • Bob_Wallace

      Robert – Here’s you initial post –

      “The 8.9 cents kWh does not include transmission costs as stated and is compared to a rate that includes transmission and other costs. Also this accomplishment was brought about by Feed in Tariffs, Federal Government subsidies and China’s massive export subsidies but were not quantified. Could someone be more specific on what was actually accomplished?”

      We Nimrods have been flailing around trying to figure out what you were asking in the word salad you posted.

      You might notice that there is nothing in your post about PV vs. thermal. You introduced thermal later in the conversation.

      Your post specifically asked about subsidies. No one needed to expand the discussion to include subsidies as you had already broached the topic in your initial post.

      Now I have now idea what you mean by “Watch What I Do to Your World”. Perhaps you shouldn’t mix keyboarding and drinking….

  • robertemery

    My question about cost basis was never answered and I am not against the subsides especially CSP Solar. If it weren’t for subsidies, I would still be working instead of retired and wouldn’t have time give you PV boys a difficult time

    • Bob_Wallace

      I’m not sure what your question is.

      And for the folks who spend time here being “PV boys”, I suspect you haven’t paid attention. Most of us are interested in solutions to getting off fossil fuels.

      Personally I’m hoping that CSP can play a role. I’m doubtful about a significant ‘sunny-hour’ role, but do see CSP thermal as offering a good potential for late afternoon/early evening supply. And for smoothing daytime PV input.

      Concentrated PV – that’s entirely a price race. At this point it looks like flat panel PV offers more power per dollar.

      • robertemery

        I wanted to know how much of the 8.9 cents is subsidies. I was asked by a magazine editor last week because most can’t differentiate between the two. Solar PV is not my bailiwick and I will be the first to admit it. I m happy to see someone with a cause other than money. The CSP projects I invested received a 30% grant to the 20% equity or a 150% ROI. I don’t know a single one of my fellow investors who cares about getting off fossil fuels. Sorry. I am not going to open the door and continue a long discussion regarding CSP research being conducted by EPRI and NREL you obviously don’t have information. Here’s a taste of information. Arnold Schwarzenegger is actively lobbying to replace Dr. Chu. Lets see what happens. PowerSmith Group.com

        • Bob_Wallace

          Some large scale solar projects benefit from loan guarantee programs which allows them to borrow money for less. That is not a direct subsidy in the sense of government funds being paid to the solar company. It does leave the government liable for the loan if the installation does not come on line.

          Some projects have received a 30% investment tax credit. That means that some future profits will be taxed at a lower rate. This is usually done because outside money will invest and use the ITC to offset profits in from some other activity. It sweetens the pot for investors. Perhaps it pulls output price down a bit because that money comes at a lower rate.

          There’s some argument that some solar installations have been given ‘sweetheart’ deals on leasing of public land. Of course that charge holds with mining and cattle grazing as well.

          I don’t believe that we have a federal FiT or any other direct subsidy for large scale solar. Could be wrong about that.

          Now, you made the claim that “the cost of solar PV has significantly decline(d) when in fact it is due to increased subsidies and Feed in Tariffs and not technological advances”.

          Perhaps you could explain/document your claim?

          • http://profiles.google.com/robtemery Robert Emery

            You obviously don’t get out much or read? Ivanpah for example, 20% equity, 30% government GRANT and 50% low interest gov loan. I did not sign up to be a teacher and I am not spending my time continuing this over the Internet. I simply do not care what anyone believes, I deal in reality. I wanted to engage in a lively discussion, not teach high finance or reality

          • Bob_Wallace

            The article, best I can tell, is about PV solar. Not thermal solar like Ivanpah.

            Please don’t sign up to be a teacher. You’d be very poor at it based on your ability to communicate as demonstrated so far.

          • http://profiles.google.com/robtemery Robert Emery

            Did we meet at VNP in the late 70s when I was trainiing for Russia?

  • robertemery

    The article suggests the cost of solar PV has significantly decline when in fact it is due to increased subsidies and Feed in Tariffs and not technological advances. Subsidies to oil and gas are irrelevant to a simple question about the actual cost basis. Now before I am branded a heretic, you should know I have a pending CSP solar Patent and involved in the industry since the 80s begining with engineering and construction of the worlds’s first utility scale plants at Kramer Junction

    • Bob_Wallace

      Solar prices have drastically fallen due to both subsidies and technological advances.

      Subsidies have helped create a market for solar and that has attracted innovative people who have worked on the problems keeping prices high.

      Increases in panel efficiency, improved inverter design, improved mounting systems – all of these are technological advances.

      Bringing more silicon refinement on line, creating dedicated solar factories (as opposed to making due with chip overruns/discards), establishing more efficient supply streams are ways other benefits of market growth created by subsidies.

      Oil and gas subsidies, to the extent they decrease the ‘price at the pump’ work against solar technology advancement. They artificially lower the price of fossil fuels and make renewables less attractive investments.

  • robertemery

    The 8.9 cents kWh does not include transmission costs as stated and is compared to a rate that includes transmission and other costs. Also this accomplishment was brought about by Feed in Tariffs, Federal Government subsidies and China’s massive export subsidies but were not quantified. Could someone be more specific on what was actually accomplished?

    • Bob_Wallace

      How about thinking about the immense subsidies fossil fuels have received over the decades and are still receiving?

      And the fact that transmission and rail transportation construction costs were largely provided by agencies other than the fossil fuel industries?

      The take-home for me is that we are now getting to the point at which we can make clean energy for an acceptable price. To fully transition to renewables will mean that we will have to built some new transmission and that we will need to subsidize renewables for a few more years.

      The transmission we build now will serve us for many decades, if not centuries. These new electricity sources won’t ever run out of fuel or foul our planet.

      • robertemery

        The article suggests the cost of solar PV has significantly decline when in fact it is due to increased subsidies and Feed in Tariffs and not technological advances. Subsidies to oil and gas are irrelevant to a simple question about the actual cost basis. Now before I am branded a heretic, you should know I have a pending CSP solar Patent and involved in the industry since the 80s begining with engineering and construction of the worlds’s first utility scale plants at Kramer Junction

        • Akbweb2

          If renewables are competing against the cost of subsidized oil, gas and coal exploration and production than they are certainly relevant…

          The cost is the price of the electricity the utilities are contracting to pay…$0.089/kWh, an exceptional decline in a short period of time…

          • robertemery

            According to an Energy Information Administration, the U.S. subsidizes solar power to the tune of $24.34 a megawatt hour, $23.37 that year for wind, 44 cents for coal, 25 cents for natural gas and $1.59 for nuclear power. If Renewable Energy was a prevalent as fossil fuels, we couldn’t afford the subsidies.

          • Bob_Wallace

            You left out the billions and billions we paid out in subsidies to fossil fuels prior to this year.

            And you failed to include the external cost of fossil fuels.

            A partial accounting will not give you an accurate answer….

          • Kyle Sager, helioshirt

            Robert – so how come you neglected to mention that the EXACT SAME TABLE in the EIA report you mentioned…Subsidized your “prevalent” refined coal to the tune of $29.81 per megawatthour. Did you even bother to look it up??? WOW…

          • http://profiles.google.com/robtemery Robert Emery

            Kyle do you even know what refined coal is and its use?

          • http://cleantechnica.com/ Zachary Shahan
          • robertemery

            .089 cents kWh is a good price. Again, more clearer. What is the cost without any subsidies and how much has that changed over a certain period time. I was asked by a magazine last week what the cost was? My reply was I couldn’t say, I am always given costs based on subsidies otherwise I use NREL numbers

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