Report: Solar Electricity Cost Likely to Fall 50% in 2009

[OKIsItJustMe]

http://www.greentechmedia.com/articles/read/report-solar-electricity-cost-likely-fall-50-in-2009/

November 23, 2009

Report: Solar Electricity Cost Likely to Fall 50% in 2009

The big drop in solar panel prices this year has contributed to a significant decline in the cost of building and operating solar power plants this year, says New Energy Finance.

The cost of solar electricity is likely to drop by 50 percent in 2009 from the previous year due largely to a big fall in solar panel prices, said New Energy Finance Monday.

The 50 percent drop refers to what's commonly called the "leveilized cost of electricity," or the cost of producing the power over the lifetime of a solar power plant (from building to operating power plants). Utilities and banks use these metrics to determine their investments and operational costs for these generation facilities over time.

The levelized cost for solar electricity fell to as much as $160 per megawatt hour in 2009 for the worldwide market, said Jenny Chase, head of solar research at New Energy Finance.

The $160 per megawatt-hour came from installations in sunny spots – such as the deserts in the western United States – that used the cheaper thin-film solar panels, like the ones produced by Tempe, Ariz.-based First Solar. The cost of building solar energy systems using thin films can be as low as $3 per watt, New Energy Finance said.

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[DCKit]

1. Were it that that $3.00 per watt cost tranlated to the consumer (price) this year. n/t

[kristopher]

2. I think it is...

But it is the commercial market that is sucking it all up.

[Massacure]

3. Solar costs have not dropped 50% in the last year.

I don't know where they are getting their data from, but SolarBuzz lists the average cost of panels in November as $4.34 a watt, down $0.50 from January.

[kristopher]

4. You didn't read the article carefully enough

The article said:
"The 50 percent drop refers to what's commonly called the "levelized cost of electricity," or the cost of producing the power over the lifetime of a solar power plant (from building to operating power plants). Utilities and banks use these metrics to determine their investments and operational costs for these generation facilities over time."

And

"The $160 per megawatt-hour came from installations in sunny spots – such as the deserts in the western United States – that used the cheaper thin-film solar panels, like the ones produced by Tempe, Ariz.-based First Solar. The cost of building solar energy systems using thin films can be as low as $3 per watt, New Energy Finance said."

That isn't the same as "average cost of solar panels" which would include all technologies - including those much more expensive than thin film; which is, in fact, reported to be as low as $0.39/watt out the factory door.

Nor is the average cost of panels the same as the "levelized cost of electricity" from thin film in high production areas, which is the specific metric quoted as dropping 50% this year.