Solar and wind have continued to show amazing growth in all areas over the past 6 months. In terms of price, recent revelations show the continuing decline of the price both. In Nevada, “NV Energy agreed to pay 3.87 cents a kilowatt-hour for power from a 100-megawatt project that First Solar Inc. is developing. That’s a bargain. Last year the utility was paying 13.77 cents a kilowatt-hour for renewable energy. The rapid decline is a sign that solar energy is becoming a mainstream technology with fewer perceived risks.” As for wind, DOE just has announced the price for purchase power agreements for last year. “At 2.35 cents per kilowatt hour, wind is cheaper than the average price of wholesale electricity in many parts of the country.” In spite of all the continued negatives and false statements that the traditional, conservative media (such as the Wall Street Journal and the Economist) are spouting about renewables, solar and wind have surpassed nuclear, oil, and coal, and is very close to natural gas in terms of delivering the cheapest kwh. They will continue to grow, even if government subsidies are removed. If we quantify carbon from fossil fuels, dangers from mining and drilling, transportation, and other emissions into the price formula, then it is really a no-brainer!
In terms of production, Solar City (a California based manufacturing and leasing solar company) announced that their annual manufacturing capacity of 1400MW of PV panels per year was sold out in July, and their orders go well into most of 2016. They are building a 1000MW facility in Buffalo, NY which will produce panels at the “magic” number of 50 cents a watt, and at an unprecedented commercial efficiency rating of close to 24%. That blows the Chinese right out of the water, and will make solar affordable and available to just about everyone…with an American product. Couple this with Tesla’s battery manufacturing in Nevada, and the solar revolution is over---we won!
Of course, there is continued opposition (if that’s the right word) to the potentially enormous growth of renewables in the electricity market. The old argument was that they were too expensive, and had to be subsidized. That is no longer true, since the industry is saying removal of the various tax credits on both sources would slow down their deployment, there is really no holding back the exponential growth that is now in play. As a matter of fact, some are now arguing that solar might become so cheap, that there would be no economic incentive to invest in it…you can get more of a return investing in a trillion dollar nuclear industry!
The major battle now is not technology or price, but political in how wind and solar can transition into the huge “old school” utilities industry. For the past 100 years, public and private utilities enjoyed the monopoly of generating electricity, and delivering it to its customers. The more they produced and sold, the more money they made, even though they were “regulated” by public utilities commissions. All that changed, starting in the 1990’s with some deregulation, to now where anyone (you or me) can produce electricity, use it in our homes or industries, and sell any excess to the utilities. Oops, there goes the monopoly control. What happens when the price of a renewable KWH is cheaper than what the traditional large coal or nuclear plant can produce? How does a company get its investment back if it has to prematurely shut down a costly power plant? Who pays for the upkeep of the grid…the transmission and distribution of electricity to individual homes when there are fewer customers buying utility electricity? (Remind you of the landline-cell phone debate?) What happens when solar and wind provides more electricity than is needed at any specific time, or doesn’t produce when needed most? These are all very valid questions, and will require quite an investment of money modernizing the grid, new ideas and technology to manage the grid, storage of electricity so it can be available when needed, and a whole re-working of the obsolete financial model of the power utility. At a recent conference, Solar City addressed the utility industry and said renewables are inevitable. Rather than doggedly fight between ourselves, lets work together so the transition occurs as smoothly as possible, and everyone can still make money! What a concept. A lot of the utilities are lock in past, and what is needed is the use of our brightest and smartest new ideas in this digital age. That, and the education and cooperation of our elected leaders and government bodies.
This is happening all over the world…Germany is leading the way; China is huge; India is jumping into fray; Africa is on the verge…we in the US can lead, or continue to muddle along listening to the money cries of the fossil and nuclear industries.