The United States Energy Department’s National Renewable Energy Laboratory has updated its analysis of electricity generation technology costs, and it’s good news again for wind and solar, which come out cheapest alongside natural gas.
The National Renewable Energy Laboratory (NREL) has released its 2017 Annual Technology Baseline (ATB), the third edition of its highly respected analysis of current and projected energy technology generation costs, focusing primarily on utility-scale electricity generation technologies — although, this year NREL have also included distribution-level solar PV technologies as well.
“In addition to aggregating the most reliable, timely cost and performance data spanning the full range of energy technologies, the Annual Technology Baseline highlights key trends and makes projections out to 2050,” said NREL Senior Analyst Maureen Hand. “For energy analysts and others tasked with communicating relevant electricity technology cost and performance trends that have a bearing on energy markets, the ATB serves as an indispensable go-to resource that greatly facilitates and streamlines the work involved.”
This year’s ATB is now available in a new interactive website published by NREL here, but for those looking for the quick highlights:
Levelized cost of energy LCOE values calculated using macro-economic indicators (e.g., interest rates) estimated for 2017 in the U.S. Energy Information Administration’s Annual Energy Outlook 2017. The ATB focuses on electricity generation technology capital cost, operating costs, and energy production. It does not include time-varying macro-economic indicators. Values shown in 2015 U.S. dollars; hydropower is classified as non-dispatchable because most new hydropower generation would operate in run-of-river mode. LCOE captures the energy component of electric system planning and operation, but the electric system also requires capacity and flexibility services, typically associated with dispatchability, to operate reliably.
Maybe of most interest from this year’s ATB is the fact that solar PV capital costs have continued to decline recently and are only expected to continue to decline. Similarly, onshore wind capital costs have also fallen while capacity factors have increased — higher megawatts at cheaper rates. Both of these trends are expected to continue, serving to further increase the attractiveness of solar and onshore wind, and making them increasingly cost-competitive — especially against natural gas combined cycle plants in the near term.
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