Home Solar Cheaper Than Every Concentrating Solar Power Plant

Date: 13 Jan 2011 | posted in: Energy, Energy Self Reliant States | 3 Facebooktwitterredditmail

A residential rooftop solar PV system in Los Angeles, CA, has a cheaper cost per kilowatt-hour of electricity delivered than the most cost effective, utility-scale concentrating solar power plant. 

In 2010, a buying group called Open Neighborhoods openly advertised an opportunity to get a solar PV system installed for $4.78 per Watt (not including any tax credits, rebates, or grants), a system that would produce approximately 1,492 kilowatt-hours (kWh) per year (AC) for each kilowatt of capacity (DC). 

Based on the best available public information about the costs and performance of operational concentrating solar thermal power plants, the PS10 solar power tower – an 11 MW installation in Spain – has the lowest levelized cost of operation of any concentrating solar power plant that produces electricity.  PS10 had an installed cost of $4.15 per Watt and produces 2,127 kWh per kW of capacity. 

However, due to higher operations costs and a higher cost of capital (8% rather than 5%) for a concentrating solar power plant, the levelized cost of the residential rooftop system (17.3 cents per kWh) is less than that of the power tower (19.9 cents per kWh).

This analysis also does not include any transmission infrastructure or efficiency losses, either of which would increase the levelized cost of the concentrating solar power plant.  It also did not include the lower price point from Open Neighborhoods, which advertised a possibility of driving the price down to $4.22 per Watt (driving the levelized cost down to 15.3 cents per kWh).

The Southern California Edison project, also featured in the chart, is another example of low-cost distributed solar PV, with the 250 MW project spread across commercial rooftops in 1-2 MW increments but still achieving large scale. 

Ultimately, this data further confirms that distributed solar can be delivered less expensively than centralized solar power. 

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Discussion: Why Policy Matters for Distributed Generation and Why DG is More Than Electricity

Date: 12 Jan 2011 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

I received an email this morning from a thoughtful fellow who had read some of the posts I’ve sent over to Renewable Energy World. His perspective is worth sharing because it highlights the all-too-common tunnel vision we can get about … Read More

Solar PV Costs – Does State Market Size Matter?

Date: 5 Jan 2011 | posted in: Energy, Energy Self Reliant States | 1 Facebooktwitterredditmail

Before the holidays we posted a chart illustrating the average cost of solar by state, highlighting Minnesota’s claim to the most expensive solar PV in the nation.  The data came from the brilliant report, Tracking the Sun III: The Installed Cost of Photovoltaics in the U.S. from 1998-2009 (large pdf). 

But are solar costs high in some states simply because the market is small?  The answer seems to be no.

The following chart illustrates the average cost of solar PV by state, mapped against the total installed capacity (in megawatts) from 2007-09.  California is omitted because its 1600 MW of new capacity dwarfs other state markets; Colorado, Hawaii, and North Carolina were not included in the original dataset.  The markers for Oregon and Connecticut were shaded blue and red, respectively, to help distinguish them from surrounding states. 

What’s clear from the data is that there seems to be little relationship between market size and average installed costs.  Texas installed 16 MW at an average cost of $7.00 over the three years analyzed, whereas New York and Nevada had costs 25% higher in markets five times the size.  And five states with markets 10 MW and smaller had costs ranging from $7.60 (New Hampshire) to $9.10 per Watt (Minnesota).  The largest markets in New Jersey and California tie for 5th lowest cost, 10% more expensive than the least expensive market despite being (in California’s case) two orders of magnitude larger. 

The data leave a lot of questions.  Why don’t larger markets uniformly have lower prices?  Why is there such large variation in costs in smaller solar market states?  And how does state solar policy matter, when there is no correlation between the total value of state incentives and the before-incentive installed cost of solar?

Update 1/20/11: a cacophony of different permitting rules may be partially responsible.  The solar industry estimates that permitting costs add $2,500 to each solar installation.

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Britain to Abandon RPS & Move to Feed-in Tariffs

Date: 22 Dec 2010 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

In a potentially precedent-setting move for the English-speaking world, Great Britain’s ruling coalition proposes abandoning its long-running experiment with so-called “market reforms” of the 1990s. Included in the proposal released by Chris Huhne, Energy and Climate Change Secretary December 16, 2010, is wholesale revision of the country’s Renewable Obligation, the British version of Renewable Portfolio Standards (RPS).

While the renewable targets will remain, the government proposes abandoning the mechanism for reaching the targets, the Renewables Obligation (RO). Instead the coalition government of the Conservative and Liberal parties proposes implementing a system of feed-in tariffs for “low carbon generation”.

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California Launches Compromise Small-Scale Renewable Auction

Date: 22 Dec 2010 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

The California Public Utility Commission officially launched its Renewable Auction Mechanism (RAM)* last week, to spur more development in renewable energy projects smaller than 20 megawatts. 

The good and bad news is summarized quite well by the FIT Coalition, with the good news being:

  1. A strong focus on the < 20 MW market segment, also known as Wholesale Distributed Generation if the project connects to the distribution grid.
  2. Recognizes value of “locational benefits,” rewarding projects that site close to load to avoid unnecessary transmission expenditures – “(massive capital expenditures, decade-long build-outs, and significant line and congestion loses)”
  3. Requires utilities to provide specific grid details to help developers select project sites before they commit.

Points 1 and 2 highlight an increasingly recognized issue: meeting the near-term benchmarks in state renewable energy standards may be impossible if states rely on centralized, transmission-dependent projects.  Sub-20-megawatt projects can quickly sum to large quantities of renewable energy, capture most economies of scale, and come online much faster that large, centralized projects.

Point 3 is huge, as well, because it finally addresses a market failure where distributed energy project developers could not get information about grid “sweet spots” for plugging in smaller scale renewable energy without significant infrastructure upgrades.  It’s an issue too rarely discussed, with a rare exception being our 2008 report on Minnesota’s potential to meet its state RPS without significant new high-voltage transmission lines (backed by two state-sponsored studies).

The bad news is that the CPUC missed several opportunities to maximize the potential for distributed generation:

  1. It allows participation by transmission-connected projects, which will not carry the same advantages as distribution-connected projects – “producing energy close to load and avoiding the significant costs, timeframes, and environmental issues associated with transmission.”
  2. It institutes a lop-sided playing field that will favor well-established companies and larger projects.
  3. It perpetuates the high failure rate of solicitation programs: “In general, California’s solicitation-based RPS programs result in more than 95% of the bid capacity to be rejected by the utilities or to be abandoned by developers in the end due to underbidding.”  These rejections lead to enormous stranded development costs, as much as $100 million in one solicitation.

Despite the bad news, it’s a promising “pilot” program that will support 1 gigawatt of distributed renewable energy.   Let’s hope it improves with time.

*And folks suggest feed-in tariff is a lousy policy name…Speaking of which, a number of media stories indicate that this is California’s take on a “feed-in tariff.”  That’s like saying like soccer is Europe’s take on American football.  One is an auction, the other is a standard contract with prices based on the cost of generation. 

Photo credit: alforque on Flickr

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U.S. Military Sees Great Value in Distributed Renewable Energy

Date: 22 Dec 2010 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

There’s no better illustration of the value of distributed renewable energy than the U.S. military.  In Iraq, the 50,000 U.S. troops (as of August 2010) use 600 million gallons of fuel per year at a cost of dozens of lives of U.S. soldiers who die protecting fuel convoys and financial cost of nearly $27 billion for fuel and security ($45 per gallon!).  New distributed renewable energy systems can help combat brigades reduce fuel consumption, saving lives and money.

One Marine company – Company I, Third Battalion, Fifth Marines – field-tested the Ground Renewable Expeditionary ENergy System (GREENS) system in August 2010 and found that it saved 8 gallons of fuel per day for each of the company’s 150 men.  Complemented with other renewable energy systems, the Marines powered their combat operations center without using the diesel generator for eight days.

The renewable technology that will power Company I costs about $50,000 to $70,000; a single diesel generator costs several thousand dollars. But when it costs hundreds of dollars to get each gallon of traditional fuel to base camps in Afghanistan, the investment is quickly defrayed.”

It takes approximately 200 GREENS (1,600 kilowatts of solar modules with battery storage for 300 Watts of continuous power) to replace a single 60 kilowatt diesel generator, but it saved the Marine company 1,200 gallons of fuel per day.  In Iraq, that fuel would have cost $45 per gallon, including transportation and security costs.  That’s a savings of $54,000 in a single day.  If priced at $70,000 each, the 200 GREENS will pay back in 260 days, less than 9 months. 

If every U.S. company serving in Iraq made use of GREENS, it would reduce fuel consumption by U.S. troops by 25%, saving 146 million gallons of fuel and $6.5 billion per year. 

There are benefits besides saved fuel and money.  Marines appreciated that the solar-powered base systems are quiet, and also don’t require constant refueling.  The no-fuel requirement also benefits security, as 72 U.S. soldiers died protecting convoys in Iraq in 2009.

The military provides a great illustration of the utility and cost-effectiveness of distributed generation, and one that should inform state-side strategies for energy deployment.

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The Fragmentation of American Energy Policy

Date: 17 Dec 2010 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

Last week was a tough one for distributed solar markets in several states, as a remarkable number of renewable energy incentive programs hit their budget or capacity caps, or are shrinking in scope: San Diego Gas & Electric’s allocation of … Read More

Distributed Solar Power, Analyzed

Date: 14 Dec 2010 | posted in: Energy, Energy Self Reliant States | 0 Facebooktwitterredditmail

Yesterday we discussed the spread of solar carports in California, highlighting the Milpitas School District’s 14 distributed solar PV arrays.  According to a news story, the district anticipates savings of $12 million over 25 years from the projects, which were … Read More

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