Solar just hit its lowest price ever

Oil-rich Abu Dhabi is planning a massive solar project.

A utility-scale solar plant in India. CREDIT: AP PHOTO/AJIT SOLANKI

A utility-scale solar plant in India. CREDIT: AP PHOTO/AJIT SOLANKI

By Samantha Page

Transitioning to clean energy is the single most important thing we can do to avoid the catastrophic effects of climate change.

Luckily for us, clean energy keeps getting cheaper.

This week saw the lowest-ever bid for electricity from a proposed solar plant, worldwide. A proposed development in Abu Dhabi will sell its electricity for 2.42 cents a kilowatt-hour (kWh).

For context, the average price per kWh for residential electricity in the United States — from all sources — is 12.73 cents. Wholesale prices for electricity can vary dramatically, but a set of record-low bids last summer for solar in Austin were around 4 cents per kWh. A 350 MW plant provides enough electricity to power about 57,000 average U.S. homes.

For years, solar prices have been falling and solar projects have been growing. It’s a fairly straightforward relationship: As the industry grows — streamlining production, training more workers, and generally benefitting from the economies of scale — prices come down.

solarchart

Data from the Solar Energy Industries Association and GTM Research show the inverse relationship between scale and cost. CREDIT: SEIA.org

ThinkProgress

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Categories: Abu Dhabi, Climate change, Climate science, Conservation, Economics, Energy policy, Environment, Environmental policy, Technology, Top stories, Wind and solar power, World news

3 replies

  1. The big story here–and it is a big story–is one that is rife with ironies. The most obvious is that the world’s historic leaders in fossil fuel production, the Saudis and the Arab emirates, have been pivoting over the last few years toward becoming not only the world’s leading investors in renewable energy ventures, but also to become a major global financial marketplace for renewable energy technologies.

    It’s ironic, too, that a region of the world with some of the world’s most significant fossil fuel resources should also have some of the greatest solar energy generation potential.

    President Obama’s drive to develop domestic fossil fuels may have seemed counterintuitive for a governmental administration touting renewable energy sources. But was it really? A global oil glut has made renewable energy a more attractive energy investment than it might otherwise have been.

    Liked by 1 person

    • I think a lot of credit goes to President Obama, Bill Gates, and the18 national leaders that
      joined the United Nations Climate Summit in Paris, this last year. I heard it was a major success. The goal was to launch a historic expansion in clean energy research along with developmental funding. The funding is from both the public and private sector. Together they are likely to constitute the biggest investments in clean energy technologies in history.

      Liked by 1 person

      • Fossil fuels have had a diminishing returns investment prospectus for decades. Of course, the fossil fuels industry has fought tooth-and-nail to convince investors, politicians and the public that the well would never run dry. Improved extraction methods, like environmentally damaging deep water drilling and fracking, have extended the end date for fossil fuel’s investment viability, but the well is running dry. And in more ways than one.

        The shift toward renewable energy sources and investment is like gay rights, marriage equality, and everything else that makes sense: the world’s leaders have to wait for the slow kids to catch up in order to have the political capital to invest in the necessary change. Climate change has to be too obvious to ignore and fossil fuels have to become too expensive to afford. We’re almost there.

        OPEC knows that the supply isn’t endless and that new technologies are rapidly making their stock in trade worthless. Investing in renewable energy technologies is just smart.

        Liked by 1 person

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