In May 2015, Austin Energy received a firm bid for solar energy for less than 4 cents per kWh. Responding to an RFP seeking up to 600 MW of solar capacity, the bid is one of the lowest solar bids ever seen in a utility solicitation.
Large utility-scale solar projects, with their scale economies, in areas with good solar irradiance continue to improve their cost competitiveness with other supply options. Upcoming changes to the ITC (i.e., 30% to 10% in 2017) will cause a temporary hiccup but will unlikely disrupt the long-term trend toward increasing cost competitiveness for the utility-scale solar industry. Instead, the event will mark an important transition as the industry moves from policy to market drivers. First Solar CEO, Jim Hughes, highlighted this point by recently calling the ITC “irrelevant,” and forecasting it will take 18 months for technology price declines to offset price increases associated with changes to the ITC.
Austin Monitor: Solar Prices Keep Dropping, Says Austin Energy
GreenTech Media: Cheapest Solar Ever
Austin Energy Presentation: Resource Plan Update: Solar RFP & Independent Review
Utility Dive: NV Energy Buys Utility-Scale Solar at Record Low Price Under 4 Cents/kWh
This report is part of the Clean Tech & Sustainability Minute series. To view all featured Minutes, please click here.
Sussex Economic Advisors is now part of ScottMadden. We invite you to learn more about our expanded firm. Please use the Contact Us form to request additional information.