NV Energy, a Berkshire Hathaway-owned utility company has signed a PPA to purchase electricity from the 100 MW Playa Solar 2 power plant at a stunning low rate of $0.0387/kWh! The cost of solar electricity is still decreasing. In the past, we reported on a Texan solar power plant that sold its electricity for 5.8 cents/kWh, and that was incredible news but nothing compared to this. 3.87 cents/kWh is approximately 68% cheaper than the national average electricity cost.
‘That’s probably the cheapest PPA I’ve ever seen in the U.S.,’ Bloomberg Intelligence utility analyst Kit Konolige said. ‘It helps a lot that they’re in the Southwest where there’s good sun.’
Certainly! More sunlight translates to more power per solar panel, resulting in a lower cost per kWh.
The growth of the solar industry contributes to the price decline we’ve been seeing over the years. The declining cost of PV solar technology certainly helps too. If solar panels get extremely cheap (and at this rate, that might happen), that makes the idea of purchasing extra solar panels to compensate for cloudy weather (as opposed to energy storage or gas backup) more attractive.
Ian Clover from PV Magazine said:
‘Having paid $0.1377/kWh for renewable energy in 2014, this new, lower price is an encouraging reflection of the rapid decline in solar costs over the past 12 months. Nevada’s Public Utilities Commission, which oversaw the submission of the 20-year, fixed-rate PPA, called the price point “very reasonable” when compared to both existing solar contracts and other fossil-driven generation sources.’
The cost of solar power will continue to decline across the nation as older solar power plants are upgraded or replaced with the newer, cheaper panels from First Solar and other manufacturers. Doing this will help solar power plant owners to stay in the game and compete with not only the fossil fuel plants, but also the renewable ones. The future of solar is glowing!