Data Point - Data for Grid Parity for Solar PV keeps going into the future - Granite Grok

Data Point – Data for Grid Parity for Solar PV keeps going into the future

solar-grid-parity(H/T: Business Insider)

I have said often that I am not against Solar Energy – I bought a solar hot water heater and solar hot air solar collectors (home heating).  But I paid a pretty penny for them and once the subsidies dried up, so did the companies that could no longer service the companies.  BI pulls from another source for this chart – Catherine Wood of AllianceBernstein:

The coming of grid parity keeps receding into the distance like a desert mirage. Over the last six years, executives at solar energy firms and their consultants have projected repeatedly that solar energy will reach grid parity—become cost competitive with other power sources—in three to five years—only to push its expected time of arrival further into the future…

…To understand the concept of grid parity, imagine you’re an electric power company executive poised to invest in new generating capacity. You can invest in any technology you want, using any kind of fuel. All you care about is whether the net cash flow from selling the electricity would provide a reasonable return on invested capital. Your first order of business would be to see what price you’d have to charge for the electricity you produce to justify the investment.

Today, you’d need to charge $375 per megawatt hour to justify investment in new solar equipment—nearly four times the average US retail price of electricity. That’s why solar energy requires steep subsidies.


Other power-generating technologies require a much lower price of electricity to attract new investments—from $95 per megawatt hour for new-built nuclear power generators to $130 for new-built wind power generators. Investments in gas-powered and coal-powered generating plants require a price between these two, even if you factor in paying $50 per metric ton to offset the carbon emissions and gas prices more than double their current level.  And these calculations don’t include the cost of backup power or energy storage to supply power when the sun isn’t shining. A backup power system or battery would add roughly 25% to the electricity price required to justify new investment in solar power.  Finally, these calculations ignore the cost of the real estate upon which a solar panel sits, because most smaller scale installations are on a rooftop that would otherwise go unused. For utility-scale installations, however, ignoring real estate costs is not fair. The cost basis for what will be the largest utility-scale solar power installation in Japan more than doubles if you take into account the value of the real estate that the solar panels will occupy.

Defenders of solar power understand that it’s relatively expensive. They argue that investments and subsidies are needed to get the technology to a cost-competitive scale. They leave a key question unanswered, however: how much scale is required?

I hear all the time from the Solar True Believers that solar power is EASILY cheaper than all other forms of mass energy; I keep telling them that without subsidies, their chosen from of government largesse would be toast.  Don’t get me wrong – I LIKE PV but I’s never buy it right now as I’m too cheap.  Nice to see this article from an energy insider gives me some backup.

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