Published on March 20th, 2012 | by Zachary Shahan4
Solar Grid Parity in North Carolina (New Study)
March 20th, 2012 by Zachary Shahan
As John Farrell noted in an article in January, grid parity is a complicated matter (and doesn’t take into account important health costs, greenhouse gas emissions costs, and grid costs). But grid parity is rather important because it relates to what actual consumers directly pay for solar-powered electricity compared to conventionally powered electricity.
Solar power has already hit grid parity in several regions, and a new study says that you can add some types of solar in North Carolina to that list.
The report, “Levelized Cost of Solar Photovoltaics in North Carolina,” is from the North Carolina Sustainable Energy Association (NC SEA). “The data comes from over 10,000 solar PV system installations in North Carolina from 2006 to 2011 whose owners, per a state regulation, reported installation costs to the Public Utilities Commission,” Herman Trabish notes.
As one of the first states (and the first in the Southeast) to implement a renewable energy portfolio standard (REPS), North Carolina has the 8th-most cumulative installed solar photovoltaic (PV) in the U.S.
Before reporting on the key findings, I’ll note a couple very important points:
- The cost of solar power in this study, as in most studies on this tipic, assumes a 20-year solar panel lifespan. Given that most solar panel systems have 25-year guarantees now, and solar panels easily last 30 years or longer, this is really a strong underestimate of product lifespan (and, thus, an overestimate of solar electricity costs).
- While many might cry foul at costs of solar after federal and state incentives, another study has concluded that even just some of solar’s societal benefits warrant market-adjusting government incentives for solar.
Now, with that out of the way, here are some of the key findings from the report:
- For many electric utilities, solar PV systems greater than 10 kW with federal and state tax credits were at grid parity or cost competitive with commercial retail electricity prices in North Carolina in 2011.
- Solar PV systems greater than 500 kW with federal and state tax credits achieve grid parity or become cost competitive with commercial retail electricity prices for all North Carolina electric utilities in 2015.
- Solar PV systems greater than 10 kW through 500 kW with federal and state tax credits achieve grid parity or become cost competitive with commercial retail electricity prices for all North Carolina electric utilities in 2018.
- Solar PV systems 10 kW or less taking federal and state tax credits achieve grid parity or become cost competitive with residential retail electricity prices for the majority of North Carolina electric utilities in 2020.
- For many electric utilities, solar PV without federal and state tax credits will be at grid parity or cost competitive with retail electricity prices in North Carolina in 2020.
Now, the benefit of the report’s extremely conservative estimates regarding solar panel lifespans and other matters is that “we can take them into any conversation,” report co-author Paul Quinlan said, even one with a completely unbalanced fossil fuels leaning.
Notably, with solar power costs dropping so rapidly in the past year, many utilities may be completely unaware that solar has hit grid parity in their jurisdictions. Studies like this should help to inform them of that.