The cost of generating solar electricity has dropped by an order of magnitude over the last decade. Solar is now the least expensive option for generating electricity, beating out natural gas, coal, wind, and nuclear on an unsubsidized basis. This is a world-changing fact that is very optimistic for the future development of human civilization around the world. The biggest remaining challenge is that energy storage still costs almost an order of magnitude more than solar electricity generation.
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Outline of the conversation
According to the World Energy Outlook 2020 report by the International Energy Agency: "Solar becomes the new king of electricity… Renewables grow rapidly in all our scenarios, with solar at the centre of this new constellation of electricity generation technologies. Supportive policies and maturing technologies are enabling very cheap access to capital in leading markets. With sharp cost reductions over the past decade, solar PV is consistently cheaper than new coal- or gasfired power plants in most countries, and solar projects now offer some of the lowest cost electricity ever seen."
The average cost of utility-scale Solar PV has dropped from 359 $/MWh in 2009 to 37 $/MWh in 2020, according to the report "Lazard's Levelized Cost of Energy Analysis - Version 14.0." This is an order-of-magnitude drop in cost in just one decade. See the graph below.
The cost of wholesale energy storage averages approximately 200 $/MWh. See the graph below. This is almost an order-of-magnitude more expensive than the cost of solar PV generation. Solar energy requires energy storage and the cost of storage remains very high.
Hat tip to Twitter personage @LibertyRPF for bringing these reports to my attention.
Threads to pull on future episodes
We hope to host future podcasts guests from the solar power industry to learn more about this important topic. Do you have a suggested guest that you would like to hear more?
What is the prospect for future developments in power storage?
What finite materials may eventually limit the production of solar panels?
Podcast Hosts
Scott Snelling, P.E. and Jason Toth, P.E., PMP
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