Grid Parity: When Solar Costs The Same As Coal (Now!)

EcoGeek:

The holy grail of all renewable is to reach grid parity -- the point at which buying green power is no more expensive (or even cheaper) than buying power from, say, a coal burning plant. And it seems that one solar power plant in a desert in Nevada -- built by First Solar -- has reached that momentous mark. At least according to one analyst named Mark Bachman.

What do I mean, "according to one analyst"? Well it all boils down to how you do your math and how you define "grid parity". Traditionally, people (by which I mean investors) have defined it in terms of cost per watt, and it was also generally thought that if solar power plants could be built at a cost of $1 per watt or less, they would achieve grid parity. Thus, if First Solar had been able to build a 10 megawatt plant for 10 megadollars (that's 10 million for any of you non-geeks out there), they would have achieved grid parity a la traditional definition.

Read the whole story: EcoGeek

Comments

[Syman Pons]

Solar thermal power plants are already producing electricity at better than solar parity. This fact is largely overlooked, but there's no reason why large towns and city in the U.S. (about ten thousand locations), shouldn't be building combination wind farm and solar thermal power plants, right now.

These facilities could produce large quantities of heat, steam, electricity, hydrogen, (using locally sequestered/recycled CO2 from a vehicles exhaust), methane (nature gas) and methanol (a perfect replacement fuel for gasoline in a flex fuel car).

The often spoken about, but yet to be realized hydrogen highway would pop into being in about three years. Vehicles would fill up at fueling stations that would surround each power facility. The enormous increase in electric power generation capacity in the country would also be available to power the large numbers of new electric vehicles that are going to be built in the near future.

The key to success is to produce energy as near to the points of use as possible. Various types of storage can be built for each type of energy produced to help produce power when the sun isn't shining and the wind resources would also do this, as well.

Transformation of the country's energy infrastructure away from geo-carbon energy sources would create fifty million non-exportable jobs over the next fifteen years.

Redeveloping the energy use, transportation and generation infrastructure of the United States during the next fifteen years, would create about fifty trillion dollars in new wealth.

[climatebabes]

Grid parity is reached for photovoltaics when they cost the same amount Watt per Watt. It has NOTHING to do with the factory cost, because that is factored in to the product cost. The notion is also flawed because you have to define a timeframe of use to calculate the cost. As solar panels are made to last up to 30 years (but in principle last a lifetime), and energy prices (unless form alternative sources) will rise significantly it is ALWAYS better to buy solar power because eventualy the cost will be ZERO. Banks should see solar investment as the surest thing, but more than likely the utility industry is blocking that.

[JimboSlice]

It is not always better to buy solar power.

Unless you pay for your solar panels in cash you have to pay interest on them every year. If you pay for them in cash you are forgoing interest that $$ could be making in T-bills or CDs or savings.

Capital is not free baby, and the cost of capital (in addition to future energy costs) must be taken into account when considering solar panels as an option.

[research]

Cost of money is important for all energy source, but MUST be separated out from the actual direct costs to be understood, as you said, the cost of money is the purchasers variable, not the technologies.

Money is free at the moment.

Solar and Wind are the war to get the economy strong again, and prevent wars for oil.

[JimboSlice]

So basically if you change the definition of cost then bam - your all set.

The real "parity" will occur when the 20 year LCOE (Levelized cost of Electricity) for solar matches that of gas and coal. The LCOE is based on all expected costs of the power plant for the first 20 years (construction and operation and interest) and the expected output of said plant over the 20 years.

Currently the LCOE for a new Super Critical Coal plant is about 6.33 cents/kWh and for a new Natural Gas plant it is 6.84 cents/kWh.... Solar is about 25 cents/kWh ---- a far cry from current coal and natural gas.

Oh, they esitmate that LCOE for coal with carbon capture and sequestration is~10.1 cents/kWh - so you tell me where we should be investing our $$ in if we want to stop global warming!!!

[research]

He was trying to do a crude version of LCOE.

To have the numbers be useful, they have to be separated out:

Actual direct costs

Cost of money at what percent

Subsidy -costs.

environmental costs

That said, I'm still studying. Things have changed so fast in solar in the last few years.

At NanoSOlars and others, claimed 1$ per peak watt panels cost and 2$ per peak watt installed.

Producing with minimum maintenance for 20 years

give 4.6Cents per KWH. Unsubsidized.

Cost of money is nearly infinitely variable as current events show.

If you have a good recent paper on LCOE for New systems, I would love to see it.

[JimboSlice]

In terms of good ones, All I know is this one for coal:

http://www.netl.doe.gov/energy-analyses/pubs/Bituminous%20Baseline_Final%20Report.pdf

For Solar this one looks pretty decent, but makes a lot of assumptions not present in the coal one:

http://www.azcommerce.com/doclib/energy/az_solar_electric_roadmap_study_executive_summary.pdf

[research]

Here's a really interesting paper arguing against LCOE as a valid indicator of future performance.

http://www.awerbuch.com/shimonpages/shimondocs/opera2005slides.pdf

[research]

Here's a comprehensive overview of available solar panels, many of which have installed LCOE below 20 cents.

http://www.energy.gov/media/FactSheets.pdf

[Myshkin57]

But how much are we going to have to spend for environmental clean-up from the effects of mining coal and burning it? I don't know the numbers either, but it seems like solar may look less cost-effective because a lot of the costs of coal and natural gas are not taken as included in the cost of energy production.

[JimboSlice]

And the costs of Si are taken into account with solar cells?

[mick7191]

Could someone with more knowledge than I tell me the environmental impact of covering 1000s of square yards of desert and the impact on wildlife?

[sheila]

sure. total, permanent ecosystem death. oh, and permanent destruction of a carbon sink that is just as effective as temperate forest. oops, that's not factored into the "cost" of these Industrial Solar Plants? well, are the enormous GHGs from building and maintaining the power plant and/or its transmission lines counted? no? ok, well surely the billions of gallons of groundwater for water-cooled concentrating solar and the reduced efficiencies when it's hot out - and we need the power the most - surely those are considered "costs?"

gee, it's weird. Big Coal, Big Nukes and Big Gas have externalized all their environmental, human and financial costs for the past 100 years and now Big Solar and Big Wind are? hmmmm. what do all these things have in common? monopolistic, mercenary, planet-killing profiteering. what is the opposite? point of use solutions like rooftop solar, microwind, conservation, energy storage, smart grids, etc. that are OWNED BY THE PEOPLE, who should be PAID for all TRULY clean power they produce and do not consume.

yet, Big Energy keeps getting all the resources. is that cool with everyone here?

[PeterSon 12k]

Clean coal is an oxymoron as coal is associated with multiple environmental problems such as habitat destruction, acid rain and global warming. Burning coal produces higher levels of carbon dioxide, sulfhur oxides, nitrogen oxides, particulates and mercury.
With these environmental impacts in mind, Tuas Power and the National Environment Agency need to reassure the public and concerned environmentalists on the use of coal in the new plant.
"Clean coal" also refers to coal burning power plants that capture and store the excess, preventing it from contributing to climate change.

Follow the lincenergy.us/y.us/

[frantaylor]

Things are getting to the point where the government can have a profound effect. Tweaking a tax here and a regulation there can invoke the "tipping point" where the new technology just takes off like a rocket because it's clearly the most cost effective thing to do, and the payback period is very short.

[research]

They calculated the cost per KWH

which is the ONLY real number.

7.5 cents/kwh for solar and 9 cents/kwh for coal.

The Grid parity number is the old deceptive number for the initial capitol cost to build and install the system.

[JimboSlice]

Because new solar plants just appear like magic in the desert and we don't need to take into account the costs of building them.

[research]

Ha Ha.

Of course raising the capitol was the excuse for not doing it.

Not anymore.

We need trillions of dollars in useful public works.

Government is often the only organization that will finance large capitol, long payback projects.

It's perfect.

It will save us money in the long term.

[blastit]

yay is all I have to say

[BillMyers]

Nice thing about Solar, once you buy the starter system, it's paid for and no more electric company bills. And, you can add to your system as needed cost-effectively. It's a gold mine for the consumer.

Kits starts below $1K.

Bill Myers
vdoaktv.netv.net

[CaliforniaJake]

The cost of solar power has in recent years been dropping by around 5 per cent annually. We all know crude oil prices have been rising, nearly tripling in the four year period from 2003 to 2007. The prices of natural gas and grid power have been rising along with oil prices. Another important factor in grid parity is geography. In the sunniest regions of Europe and the US, the price of solar electricity is about half of that in the more temperate climates of say Berlin, London, or New York. Price parity in a cloudy London is consequently only expected to arrive around 2020.

But price is not the only barrier. One of the main problems in the growth of solar energy is still the shortage of silicon. The question remains if by the time price parity will be reached, production capacity barriers will have disappeared. The silicon industry claims they will. They promise the bottlenecks should ease in the next two or three years. But even that remains to be seen.

If it fails to materialize, an important breakthrough in any of the non-silicon photovoltaic technologies could lead the way. One such technologies is Dye-Sensitized Thin Film (DSTF) which is manufactured by a company in Cardiff, Wales called G24 Innovations Limited. Back in 2007 they announced the first commercial production of this new type of solar cells, which will go along way in making grid parity possible.

[RTIII]

Silicon isn't needed any more. Nanosolar came up with a new semiconductor "CIGS" made of Copper Indium Gallium Diselenide.

You should read up on modern solar. The Nanosolar site is a good place to start as they outline in layman's terms what the issues are in the industry and what they're doing (or have done) about them: http://Nanosolar.com
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[CaliforniaJake]

I guess you completely ignored the part of my comment that said, "....any of the non-silicon photovoltaic technologies could lead the way."

When it comes to solar, in the real world businesses want to know one thing, what's the payback, what's their ROI? How many installations have you done? What projects have you completed? What's your track record? If the ROI is not worthwhile, companies are taking a wait and see attitude until the cost comes down.

I didn't find the answers to that information anywhere on this website.

Promoting a website is fine, but you need to be aware that there are solar companies especially here in California touting new technology that doesn't do anything to bring the cost per kilowatt down.

You need to learn how many various solar technologies are out there before you preach to an engineer who makes his living in the industry. Bottom line, we need to make these technologies more marketable and inexpensive. We need mass production and better efficiency to bring down the cost of solar for both commercial and residential. The ROI has to be there for companies to go solar.

[RTIII]

We reached "parity" with solar vs coal several years ago when a company in the San Francisco Bay Area, Nanosolar, patented a process and perfected manufacture of making photon-efficient Photovoltaic cells in a process called "roll-to-roll" using high-speed printing technology.

This process drops the cost of photovoltaic systems by about three orders of magnitude, or more, IIRC. The process is not only faster and cheaper, but also creates higher quality cells which are more durable and which are more easily transported and set up. - I don't recall the exact efficiency number, but I vaguely recall that it's around 20% - higher than traditional silicon style photovoltaics.

Their plan is to sell to cities first with many megawatt installations. They are not going after roof-top solar at the moment because their rolls can be used to cover - literally - acreage!

While I love their technology, I think they need to license the technology to smaller firms to provide the films to small installations.

[research]

14% so far in production.

[quiviran]

Efficiency is a phony consideration if the technology is cheap enough. Just keep adding capacity until your requirements are met. $/Kw installed is the only consideration.

[quiviran]

I'm still waiting to see a panel (4 X 8 or so) using the Nanosolar technology. Until I can buy it, it doesn't exist.

[research]

You can't buy a coal plant, can you? Neither can I.

NanoSolar is installing as fast as they can make panels, which is about 250MW peak per year.

Look at the economics, I have.

Home installation require a 2500$ transfer switch, 1000$ electrical contractor installation,

And with only 100 sq meters, I can only get some 14,000 Watts peak, about 3500 Watts average.

Just the connection to the grid cost over 1$ per watt. The fed could standardize that connection and drop the price to more like 500$ installed.

Commercial roofs are typical 10 times that size. But the connection cost is similar, so they get 35KW average at a 10 cent per watt connection cost.

That roof is also avaible for NanoSolar to check out how things are working, unlike your home roof.

[HillbillyBob]

Once you put the solar panels up they continue for 30+ years with no fuel costs, low maintenance needs/costs , tho battery back up would be enormously expensive, and they would last about 10 years because you dont let them discharge below 40% i believe it is. letting them totally discharge is what kills em.
A key thing would be to lower our use as we are doing, turning off lights,swapping to cfls then to leds as the cfls dies off, went the old freezer went we bought as efficient one as we could find and afford, same with the top loader washer, dishwasher, looks like the tv next as it died a while ago, the dryer is on last legs and the fridge is making funny noises. We are adding insulation, I have it to where on cold sunny days I can do without the heat by opening the insulated black out drapes and blinds. We double jacketed the water heater and turned it down some, cook in covered pots at a lower power setting, I put insulation in between the oven and the cabinet, that saves power, same with the dishwasher and dryer (make sure its fireproof insulation!)
Doing a lot of little comon sense things have added up to a monthly savings of about 250-500 kwrs savings.

[TimNorman]

In NH coal scrubbers for Bow Station were going to be 150 MILLION then it grew too 280 MILLION now its 400 MILLION! The plant could be replaced by 2 wood fired plants.

[KillTheMessenger]

What the analyst seems to forget is that at 9cents/kWh a coal fired power plant is a gold mine. At the same time the most efficient solar plant hardly breaks even.

And it does not have to! Coal is "cheap" because we are externalizing cost to the environment in favor of coal. If we didn't, solar could compete easily right now and coal would not look nearly as cheap as it does.

[oustfan]

I hope this is one day true, but it's not true right now. The math used to make this claim is very similar to the math used by predatory mortgage lenders a couple years ago.

[RTIII]

Boy, THAT's a mis-read...
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