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Published on April 30th, 2016 | by Cynthia Shahan


Texas Solar Prices Are Currently The Lowest Price Per Watt In The Country

April 30th, 2016 by  

EnergySage has reported that in the sometimes larger-than-life Lone Star State, Texas, solar prices are now the lowest price per watt in the country, but the market has not taken advantage of these low solar prices to a large extent yet.

A post on Greentech Media (GTM) highlighted the data from Energy Sage, a website that leads the way in comparison shopping for solar systems.

Katherine Tweed for GTM notes that an average gross cost of a solar energy system is down to $3.21 per watt in Texas  — this cost is lower than the national average of $3.69 per watt, according to EnergySage’s Second Solar Marketplace Intel Report. “In the Southwest region, including Texas, Arizona and New Mexico, three-quarters of the quotes were below $3.50 per watt.”

However, even with this low cost of solar in the state, the report continues, a 9-year payback period in Texas is a bit higher than the national average of just over 8 years.



With the “unparalleled data set EnergySagecollects over 1 million data points per day regarding the market dynamics of the US solar industry.”

So, what is the issue in Texas, where the utility-scale side of the Texan solar market often finds the cheapest solar bid solicitations in the world?

There is stagnation, or worse, with the distributed solar market in Texas, according to GTM, because of low natural gas prices — as well as “the lack of net metering in the deregulated market structure.”

The sunshiny news across the country, though, is that solar prices keep falling. The shift is moving to owning systems rather than leasing as a result.

The trend of owning systems is more pronounced with EnergySage shoppers than it is with customers who choose SolarCity, the leading residential solar installer, which is not a participant in the EnergySage platform and is also known for considerably higher prices than the average.

energysage-2015-inverters_600_428 (4)

GTM reports that 90% or more of EnergySage customers prefer ownership, “though customer-owned systems constitute less than 40 percent of the national market.”

Things are shifting even at SolarCity, as the company moves towards “a new, simplified loan product that should push the national average of customer-owned systems higher.” We’ll see how that goes (the previous loan had some pretty notable flaws/downsides), and let you know.

Related Stories:

Solar Prices Continue To Decline As US Consumers Increasingly Shop Around

Texas Grid Plans Jump In 2016 Solar & Wind Capacity

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About the Author

is a Mother, an Organic Farmer, Licensed Acupuncturist, Anthropology Studies, and mother of four unconditionally loving spirits, teachers, and environmentally conscious beings who have lit the way for me for decades.

  • sjc_1

    Former governor Rick Perry wanted to fast track twelve coal fired power plants before anyone could stop them…real progressive thinking.

    • Epicurus

      A judge and others stopped him. Only 3 were built. TXU had given him over $600,000.

      “Former TXU chairman Erle Nye, whom Perry appointed to Texas A&M’s Board of Regents in 2003, gave the governor $2,000 on the day he signed the coal-plant executive order, and another $25,000 six months later. TXU’s PAC also gave Perry $5,000 shortly after he signed the order.”

      The U.S. is like a banana republic.

  • Alharbi

    Believe it or not? just hours ago, Dubai has received five bids for phase-3 of its solar park, with the lowest at 2.99 US cents /kWh !!! The lowest bid came from Jameel Co.

    • neroden

      This needs an article, as I said in another piece. This is not only a record low, it appears to be cheaper than *everything*, with the exception of existing already-built solar, wind, and hydro plants.

    • Say wha?…. headed to my news feeds now!

  • Bryan

    $3.21 is high in today’s market. Today, fair market solar system pricing for residential systems has reached less than $2.80 a Watt installed before incentives or less than $1.90 a Watt after the ITC. That works out to be less than 7 cents per kWh over the life of the system.

    Solar leases and PPAs aren’t even in the ballpark which explains their rapidly diminishing popularity.

  • patb2009

    As the supply of PV inreases the price of electricity declines, reducing the ROI,
    but as the price point drops, the ease of purchase increases.

    • It’s easy to buy cheap wind contracts, but I’ve seen no solar contacts at all. Not sure why.

      • Steve

        Correction: Khalil Shalabi said was that 1,295 megawatts were priced below the Recurrent solar deal from last year, which was under 5 cents per kilowatt-hour not under 4 cents per kilowatt-hour.

        A lot more cheap solar is coming for Austin, Texas.

        The city’s utility, Austin Energy, just released new data on developer bids for PV projects as part of a 600-megawatt procurement. The numbers show how far solar prices have come down over the last year — and will continue to drop.

        According to Khalil Shalabi, Austin Energy’s vice president of resource planning, the utility received offers for 7,976 megawatts of projects after issuing a request for bids in April. Out of those bids, 1,295 megawatts of projects were priced below 4 cents per kilowatt-hour.

      • Not sure what you mean regarding no solar contracts, but there’s a chart of several winning low bids here:

        • Sorry, that was confusing. I meant residential contracts. A wide variety of wind contracts are readily available, but still none based on solar where I live despite the near-constant sun. Wierd.

  • JamesWimberley

    So there is no net entering in Texas, nor obviously an FIT. Perhaps there is an opportunity for an aggregator buying solar output from hundreds of households, based on a year or two’s records of consumption. Tricky, but there should be money in it.

    • JimBouton

      Green Mountain and a couple of other providers will offer paybacks at the same rate they charge you. Not net metering, but it has made solar a very reasonable proposition in Texas.

      However, natural gas and wind have really brought down electric pricing in this state over the last few years.

    • Steve

      JamesWimberley , I guess it get a little more involved when the market is deregulated.

      Selling Renewable Power-Texas
      DRG- Distributed Renewable Generation

      Deregulation of the Texas electricity market (Wiki)
      Selling Excess Renewable Power

      Some people choose to install power-generating sources, such as solar panels or wind turbines. This is called Distributed Renewable Generation, or a DRG system. There may be times when these customers produce more power than they can use. This excess power may be sold to an electric company. Selling this excess power works in different ways, depending on where you live.

      Areas with Retail Electric Competition

      If you live in an area of Texas with retail electric competition, you may be able to sell the excess power that you produce. You must sell to the company from whom you buy your electricity; however, your company is not required to purchase this power. Some companies that do purchase excess DRG power may require that the customer also subscribe to a specific retail offer. Other companies may allow the purchase and sales offers to be chosen independently by the customer.

      Retail electric customers who wish to install a DRG system must sign an interconnection agreement with their local electric Transmission and Distribution Utility.

      Areas without Retail Electric Competition

      Most areas of Texas without electric competition are served by municipal utilities or electric cooperatives. Customers in these regions should contact their utility or cooperative directly with questions about the sale of DRG power. Before installing a DRG system, you should get an interconnection agreement from your utility that describes the terms.

      For customers in areas without retail electric competition who are not served by a municipal utility or cooperative, PUC rules require the utility to purchase the DRG power put into the grid at a rate equal to its ” avoided cost,” which is the price the utility would have paid for an equivalent amount of conventionally generated electricity.

    • Steve

      Key being:
      PUC rules require the utility to purchase the DRG power put into the grid at a rate equal to its ” avoided cost,” which is the price the utility would have paid for an equivalent amount of conventionally generated electricity.

    • Titus

      That is not correct for all areas. The NRG owned retail providers such as Green Mountain and Reliant will buy back excess generation at full retail rate up to about 500 kWh per month. As mentioned elsewhere we have low rates. My most recent bill came in at 7.3 cents per kWh after all base fees and taxes.
      There are people trying here in Houston trying to move the needle. There is a group purchase RFP going on right now called solarize Houston.
      I am working on getting a system for my new house but it is about doing what I want and not about the ROI. Exactly the same as how people buy cars.

  • Freddy D

    Not only as PV prices fall more, but storage prices continue to fall, Texas will be an increasingly attractive market with all that sunshine and huge AC bills. Storage can level out the on-off cycling of the AC units all day.

    • Harry Johnson

      Most of the Great Plains experience a substantial drop in wind power production during the summer months and solar is the natural counterbalance.

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