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Large Solar Now Cost-Competitive in Oregonby on 05/08/2013 in Alternative Energy, Renewable Energy, Solar Energy, Solar Panels, Solar Power, Solar Rebates
The new VISOR “Vision to Integrate Solar in Oregon” report by Chris Robertson and Associates, LLC was commissioned by advocacy organization Oregon Solar Energy Industries Association (OSEIA) and its partners. The report finds that large-scale solar installations are now cost competitive with some other forms of energy, like fossil fuel. But the report also points out that significant market barriers to the expansion of solar in Oregon remain.
Perhaps the biggest issue however, is the state’s lack of familiarity of large-scale solar projects. The report looks at the amount of utility-scale solar projects installed in Oregon through 2011 and finds that a total of 15 large-scale PV projects were installed in the state, totaling 7.31 megawatts (MWs). “Larger scale plants, on the order of 10 MW, if ordered today, will be much cheaper to build per MW than the small plants that were initiated in previous years and only recently completed,” the report finds. “This is because development costs can be spread across a larger investment, technology costs have fallen rapidly, and economies of scale come into play.”
“Solar power plants ordered for delivery in 2014 and beyond (accounting for normal time lag in the development process) can now be considered economically cost effective for utility-scale development,” the report states. That’s based on recent price declines in PV. The report points out that First Solar in August 2012 stated its their all-in price target of $1 per watt for utility scale power plants built to come into service in 2016. It notes that Greentech Media Senior Vice President has already put the cost of new, large PV plants at $2 per watt in November 2012, with continued price drops expected. It also points to a new installation in Spain, which is costing $1.40 per watt installed.
Though the report does not offer direct cost comparisons of solar with fossil-fuel based power plants and current hydroelectric costs, the report asserts that fossil-fuel based power plants may face additional costs in the future like a carbon tax. Such a tax would increase the base price of electricity from sources like coal-fired power plants, and to a lesser extent natural gas-fired power plants. They’re also subject to fuel-based price increases—as even hydroelectric plants in Oregon can be in low-water years, which doesn't apply to solar power plants.
However, the report also looked at market barriers to solar in Oregon and how to overcome them. Suggestions include allocating land for utility-scale solar in Oregon’s sunnier regions like the Willamette Valley, mapping the state’s transmission and electric distribution systems to identify which areas are best for solar locations suitable and which parts of the system need upgrades—and finance the upgrades. The report calls on the state to set reasonable property tax rates for solar installations, establish uniform net metering rules throughout Oregon, create a brand around locally produced solar, reconsider labor rules to match job skills with tasks. It also contends that “the Congressional delegation should consider strongly supporting extension of the Section 1603 cash-grant-in-lieu-of the investment Tax Credit. It has zero effect on treasury receipts, and substantially reduces cost for project developers.”
The report also calls on the state to:
- Establish new goals for Oregon’s solar resource and the market mechanisms to enable to goals to be met.
- Implement a Clean Energy Contracts program to fund both utility scale and distributed solar generation.
- Create a clear path to 20 percent of Oregon electricity from solar energy resource by the year 2030.