Who Says Solar is Too Expensive?

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Southern California Edison is asking regulators for approval of 75 new PV contracts, totaling 105.53 MW. All priced at the cost of building a new natural gas plant. Now can we stop saying that solar is too expensive?

Details in their Advice Letter, here (pdf).

Some salient details:

The contracts were solicited under SCE’s feed-in tariff program, called CREST.

The projects are mostly between 1 and 1.5 MW in size.

Project developers have to put up $20/kW development security, refundable when/if the project comes online (to deter speculators).

Projects are mostly in the Central Valley, where the sun is stronger and land is cheaper.

The pricing is based on the 2011 Market Price Referent (pdf), which is the 20-year levelized cost of energy for building and operating a new combined cycle gas turbine, and used as the proxy for avoided cost of non-renewable power. The price changes depending on when the PV plant comes on-line, and ‘Time of Delivery’ factors are added to the MPR to account for temporal changes in energy value. In the case of SCE, when the TOD factors are applied to expected PV output, it results in a multiplier of about 1.35.

So:

Online in 2013: $.93 MWH x 1.35 = 12.55 cents/kWh

Online in 2014: $.97 MWh x 1.35 = 13 cents/kWh

There you have it: another 105 MW of solar, in bite-sized chunks, at the cost of natural gas.

Vote Solar is a non-profit grassroots organization working to fight climate change and foster economic opportunity by bringing solar energy into the mainstream.

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About Author

Walter’s contributions to CleanTechies over the past 4 years have been instrumental in growing the publications social media channels via his ongoing editorial and data driven strategies. He is the founder and managing director of Sunflower Tax, a renewable energy tax and finance consultancy based in San Diego, California. Active in the San Diego clean technology community, participating in events sponsored by CleanTech San Diego, EcoTopics, and Cleantech Open San Diego, Walter has also been a presenter at numerous California Center for Sustainability (CCSE) programs. He currently serves as an adjunct professor at the University of San Diego School of Law where he teaches a course on energy taxation and policy.

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