Rooftop Solar Could Reach Price Parity In the US By 2016

Lucas123 writes: The cost of rooftop solar-powered electricity will be on par with prices of coal-powered energy and other conventional sources in all 50 U.S. states in just two years, a leap from today where PV energy has price parity in only 10 states, according to Deutsche Bank's leading solar industry analyst. The sharp decline in solar energy costs is the result of increased economies of scale leading to cheaper photovoltaic panels, new leasing models and declining installation costs, Deutsche Bank's Vishal Shah stated in a recent report. The cost of solar-generated electricity in the top 10 states for capacity ranges from 11-15 cents per kilowatt hour (c/kWh), compared to the retail electricity price of 11-37 c/kWh. Amit Ronen, a former Congressional staffer behind legislation that created an investment tax credit for solar installations, said one of the only impediments to decreasing solar electricity prices are fees proposed by utilities on customers who install solar and take advantage of net metering, or the ability to sell excess power back to utilities.

Comments

They WILL FIght Back

[Anonymous Coward]

In the craphole region in which I live they've already passed ordinances about things like wind turbines within city limits. They call it an "eye sore" and "disruptive." That's how the utility companies will outlaw solar paneling after donating generously to their politician buddies. Either that or they'll so overregulate them that the price will skyrocket beyond most people's financial reach.

Re:They WILL FIght Back

[Shakrai]

They call it an "eye sore" and "disruptive."

They're most definitely both of those things. I had the misfortune of living through the construction of the Mehoopany Wind Farm. Think 24/7 heavy truck traffic, seemingly random road closures to move turbines/blades that were never communicated to the locals (it's awesome being half an hour late for work because they changed their schedule with no notice), huge amounts of deforestation (nine thousand acres worth), formerly crystal clear streams filled with silt from runoff, and dozens of blinking red lights where we formerly had clear nighttime skies. Take a look at this to get a feel for the impact of but one small segment of this wind farm. Look at the footprint for a single turbine and multiply it more than one hundred times, all for this one wind farm.

9,000 acres of real estate for a lousy 141 megawatts of electrical production that's wholly at the mercy of mother nature. Let's contrast that to nuclear power, the cutting edge of 1950s technology: Nine Mile Point occupies 10% of that footprint (900 acres), hosts a second power station on the property and between the two can generate 2,599 megawatts 24/7/365 regardless of the weather. That's more than eighteen times the electrical production for 10% of the land. Zero carbon emissions for production; a non-zero amount overall (plant construction and fuel mining each have a carbon footprint) but that's true of wind as well.

Wind power is a joke regardless of how you look at it. It's more environmentally disruptive than yesterday's technology and doesn't scale nearly as well. I'm not anti-solar; solar can be placed on otherwise wasted space (i.e., my roof) and is an awesome solution for peak power demand (nuclear doesn't work well here, it's better suited for base load)

Re:They WILL FIght Back

[PopeRatzo]

They're most definitely both of those things.

Thank goodness coal-fired power plants are so aesthetically pleasing and pleasant to live around.

Re:They WILL FIght Back

[Rei]

It depends on how you measure it. For example, here it says that solar is rapidly nearing cost parity except in places where restrictions and fees on net metering are in replace. But it's only fair that there should be such fees.

Part of the reason for this battle in the US is the stupid way US consumers are billed, you usually pay a single per-kWh fee. Here in Iceland our electricity bills are broken down into a "distribution fee", for the infrastructure, and a "generation fee", for the power. Surprise surprise, all of that infrastructure costs some serious money, about as much as the cost of generation itself. If a person uses solar and net-meters out at zero, they're still using all of that infrastructure (unless they're off-grid, but nobody's arguing that off-grid is anywhere near price parity). Even more than that you're relying on the existence and functionality of power plants to keep the lights on during the day. If everyone did like you, then there'd have to be instead of power plants massive daytime-energy-storage buffers, be they batteries, pumped hydro, etc (in addition to all of the wires, transformers, etc).

Now if you don't have to pay the utility, who exactly is supposed to fund this stuff? It's not cheap.

Yes, many US states require free net metering and power resale. It's the law, so utilities have to do it. But all you're doing at the time being is transferring the solar-generators' share of the infrastructure costs onto the non-solar-generators share. So when you report that these people can "break even", is that really a fair comparison?

Don't get me wrong, I'm a big solar fan. And I think that to reach true parity subsidies - such as these free net metering laws - are a great way to help get solar to that point. But let's not kid ourselves, it is a subsidy.

(Things would be a lot less controversial if you'd properly break up your power bills into distribution vs. generation costs. Personally I think bills should be even further broken down to time intervals over the course of the day and have the purchase / sale price of electricity match the actual market price for that time. It'd be a big boon for solar users, at least in warm places with low to moderate market penetration where midday electricity is expensive and nighttime electricity is cheap)

Re:They WILL FIght Back

[Rei]

Everything you wrote is irrelevant. If they're running your meter forward when you buy and backward when you sell, then you're getting the same price for purchase and sale. If you use X kilowatts and sell X kilowatts, in most places with net metering, your bill is free, or nearly so. THis should not be, because you're still moving a lot of power back and forth over a lot of expensive hardware, and relying on very expensive infrastructure to ensure that you stay powered at night. All of this hardware costs about as much in terms of amortized capital costs and ongoing maintenance costs as the actual generation of electricity at a power plant. You should be responsible for bearing your share of this cost.

People should agree to accept responsibility for their share of the infrastructure costs, infrastructure that they're clearly using just as much if not more than other customers, and instead argue on other issues that could benefit them, such as time-of-use valuation of electricity.

if something happens to the connection on my line I typically have to pay for it

I am, of course, obviously not talking about the couple dozen meters of wire from your house to the grid. I'm talking about the grid itself. If you want to disconnect your home's grid connection from the grid, by all means, you should then be under no obligation to pay for grid construction and maintenance. But as long as you want to use it, you should be paying for it.

My two cents...

[Anonymous Coward]

I think it'd be fine for utilities to charge something nominal for the privilege of solar. After all, you're not off the grid AND the power company has to deal with the upkeep of the cables. Provided it's not a money grab... that it's justified.

Net metering is when it runs backwards? That's probably find in a single month. But to carry it out over the year doesn't seem fair because during winter months, the solar panel user really is taking advantage of the grid.

As for the pricing when there's a surplus during the summer (when you sell it back), as I said before, you're not dealing with the cables/power lines... they are (the power company).

If solar power reduces carbon output from coal, good. Personally, if I could afford solar panels, I'd be interested in what uses it could provide during power outages combined with a battery backup for certain breakers/circuits (fridge, lights, and maybe one for TV watching).

Re:My two cents...

[dgatwood]

Net metering is when it runs backwards? That's probably find in a single month. But to carry it out over the year doesn't seem fair because during winter months, the solar panel user really is taking advantage of the grid.

How is that not fair? As a solar panel user, you’re no different from any other generator company. If I’m producing power, I darn well expect the power company to pay me for it, just as I expect to pay them if I’m using more power than I produce. What would be unfair would be an arbitrary limit to how far ahead you can build up bill credits towards future bills, because that would mean that I produced power that the power company benefitted from, and sold to somebody else for more than they should have paid me for it, but then didn’t pay me for it. That’s called stealing where I come from.

Besides, on average, solar power users produce power during the day, when demand is high and the cost of production is relatively high (because peaker plants are expensive). They consume power mostly at night, when demand is low and the cost of production is low. So no matter how long a cycle you average it over, the power plants are making a big profit from buying relatively cheap solar power instead of expensive natural gas peaker plant power (while selling that power at the same price). That more than pays for the negligible marginal grid maintenance costs arising out of providing power to one extra home.

And if you produce more power than you consume for a whole year, the power company gets an even bigger windfall profit. In most places, net metering happens on a one-year cycle. They pay you if you use less power than you produce over the course of that one-year period, but at least here in California, they pay a whopping 3 to 4 cents per kWh (less than half the production cost for solar, last I checked). As a result, there’s really zero advantage to overbuilding; the goal is to get as close as possible to breaking even over the year, without going significantly over. And, of course, they resold your extra power at up to 38 cents per kWh....

don't tax alternative energy and transportation

[presidenteloco]

"fees proposed by utilities on customers who install solar and take advantage of net metering, or the ability to sell excess power back to utilities"

this reminds me of the states that are passing taxes on electric vehicles because they don't pay gas tax.

There is a monumental, staggering level of myopia in those who propose and enact measures like these.

We have to transition to ~ 90% of the transport and energy in the economy to non-fossil, in a damn hurry (e.g. 2050), and we are way less than 1% of the way to where we need to get, so why the H3LLLLLL! would anyone be trying to put the brakes on the change already. Insanity, or stupidity of the highest order.

Re:don't tax alternative energy and transportation

[dgatwood]

But we need to pay for infrastructure. SO we need to tax electricity to recoup lost revenue form the gas tax.

It would make more sense to crank up the diesel tax. Big trucks cause about three orders of magnitude more damage to roads than cars do anyway (one 18 wheeler does as much damage as 9,600 cars, according to the GAO), so it is only fair that trucking companies should pay essentially the entire cost of upkeep. If they raise the taxes high enough, perhaps we’ll see a resurgence in the use of trains for shipping (which is more energy efficient, too).

Re:don't tax alternative energy and transportation

[rahvin112]

You are so very wrong.

Solar IS cost competitive. And with in a very short period, if current manufacturing price drops continue, it will be the cheapest source of power. But sure, ignore the real numbers the real reality of the situation if you wish. These numbers have been the talk of wall street for more than 2 years. Solar companies are turning down investment right now because there is too much being offered. But feel free to continue to display your ignorance. Even a fool could verify the real numbers with Google.

Re:don't tax alternative energy and transportation

[dgatwood]

Certainly, but that doesn’t negate the huge benefit of keeping most of them off the interstates for the first few hundred miles. :-)

"eye sore"

[grimJester]

You know they're desperate when the only argument against new technologies they can come up with is that they're ugly.

Re:"eye sore"

[rmdingler]

Demor, you say.

Please remember. In the rush to vilify various and sundry sources of energy vis-a-vis environmental impact, that all energy comes at an environmental cost. We will not do without the electricity in our homes and fuel for our human-toters and goodie-transport vehicles.

One day, when the other grid-friendly options are all exploited, our offspring will enjoy ubiquitous clean and relatively safe nuclear power.

Re:"eye sore"

[Ol Olsoc]

What is confusing is, why is there a debate about wind turbines on an article about SOLAR?

False equivocation? The bizzare ability of some folks to add up equate supposed disadvantages of multiple different technologies and lump them into one pile of fail, while some existing technology is heralded as perfection, ignoring any problems it might have?

Wind turbine are probably irritating and it might be better to install them in deserts, away from residences.

Kind of a whooshing sound, if they are a nuisance to anyone, that same person would not be able to live in a suburban environment, with buses and traffic and lawnmowers and leaf blowers and all.. And jet traffic would be completely intolerable for them. I've stood within 50 feet directly under one, and there simoply isn't all that much noise. On the mountaintops where they are installed here, the wind through the trees makes more noise.

Regardless, the big advantadge of the solar panels and their proliferation is that the people installing them don't give a flying fig about the naysayers. They've heard so much bullshit about how the panels will self destruct long before the investment return or warrantee period, how solar will never ever be able to provide their needs, and how the terrible poisons involved in making solar panels are somehow worse than the benzene in the gasoline they inhale every time they pump it or the MTBE octane booster isn't bad at all, the lead that used to be in it wasn't a problem at all, and that nothing beats good old fossil fuel, which we'll apparently have forever and ever, world without end, amen.

The solar users just install them, use them, and don't pay much in utility bills - or attention to the naysayers.

Re:Subsidies

[rmdingler]

There is no side of the energy industry that doesn't get subsidies, least of all the presently successful variety.

Re:Who pays for the infrastructure costs?

[presidenteloco]

FYI demand in summer in many states is highest with mid-day air conditioning, same time as solar peaks.

The grid as a whole needs to add much more storage, and long distance HVDC transmission lines, to balance intermittent power sources.

My general position is maybe start reducing the incentives for solar, EVs etc once we are at say 50% of where we need to get to in the level of penetration of these technologies. Until then, get any additional needed infrastructure revenue from gradually increasing carbon taxes.

Make sure there are both carbon taxes and affordable alternatives to burning fossil fuels.
That's the recipe for a successful transition of the energy system.

Re:With or without subsidies?

[tomhath]

His prediction that there will be a big increase in solar installations is based on what will be happening to subsidies in the next few years (he expects a rush to install as much as possible before the programs expire). In other words, the actual cost of solar won't really reach price parity - what he's really saying is that manufacturers of small scale solar power generators might see a short lived boom in the near term.

You and your grid can go dangle

[PopeRatzo]

The holy grail for solar and other renewables is "off-grid".

I'm not sure how you can look at this inexorable progress and not see that's where it's headed.

It's why there are already places where it's illegal to be off the grid.

I'll bet you that before we have ubiquitous self-driving cars we have homes that can produce their own power without the need for a "grid". My hope is that some day the grid will be the equivalent of the streetcar tracks that are still under the pavement in many cities. This is why I'm opposed to any large-scale public subsidy of the "smart grid".

Now that I think about it, my place has a "coach house" in the back. I've turned it into a garage, but there is still a hayloft in it. I've even left the block and tackle above the loft door for decoration. And that's just a few blocks from downtown Chicago. I hope I live long enough to see "the grid" become just another 20th century artifact. Of course, there are some powerful forces aligned to prevent that from ever happening.

Re:You and your grid can go dangle

[rahvin112]

Off-grid is what the power companies should actually be afraid of. Unfortunately they are in denial about that little tidbit. Off-grid is already cost competitive in Hawaii (mostly because their power is $0.35kwhr).

But battery prices are falling in tandem with solar panel prices. And I suspect any law banning off-grid will quickly be squashed by the courts as unconstitutional for many reasons. But off-grid represents a death spiral and would make every asset of the power company almost worthless. That death spiral is what they should fear, because every time they make being on grid with panels harder they are going to drive someone off-grid and the more people they do drive off grid the higher the shared costs will be which will drive more people off grid starting a death spiral that ends with bankruptcy and assets that are without value.

That death spiral is what Hawaii power is starting to deal with because of their mucking about with net metering. They've begun to change their tune but it could very well be too late for them. Hopefully it will serve as a lesson for all the other power companies before they walk down the same path.

Re:Who pays for the infrastructure costs?

[Khyber]

" a power source that's only producing cheap power during periods where demand is lowest?"

Yep, I can tell you don't live anywhere in the southern United States. Especially the southwestern areas.

Re:This has always been the problem..

[Anonymous Coward]

The price you receive has to be the value of that electricity to the utility. The calculation of that value is tricky because the utility has very high fixed costs related to infrastructure, operations, and generation; your electricity doesn't reduce their fixed costs at all. You might save them some variable costs of generation but you might also cause them to incur some additional management costs.

Re:cost/price per kW hour comparison is nonsense

[rahvin112]

Batteries are dropping in cost and increasing in capacity at about 20% per year right now. The Tesla gigafactory is expected to bring retail prices for a 85kwh battery pack to about $6000 where it's currently about $12k. For most residential homes an 85kwh battery pack is enough storage to provide power completely for more than 2weeks at full peak usage. With a gas heated home, the winter use of said battery pack would exceed a month without a single day of sunshine. Keep in mind the only time panels don't generate electricity is during the night and when the panels are covered. Even during a major storm, without snow, panels will continue to generate power during the day, just at reduced output. During the winter as long as the panels aren't covered in snow they will continue to generate power, and if tipped up to match the angle of the sun would generate better than 80% of the peak summer power.

Solar is a game changer and the retail price drops of panels will remake power generation, it's simply a matter of time at this point.

now for storage

[dickens]

If we had distributed storage (better batteries) we could crush the fossil fuel industry for good with this, and bankrupt Russia and the Saudis for good measure. It's within reach, within a very few years.