Solar power generation price determination

With the progressive phasing out of fossil-fuel-fired plants, the low-marginal cost RE options are most likely to determine the standard for prices of all generated power. RE systems by definition required high upfront capital investments, alongside incumbent thermal or nuclear power plants and hydro-electric projects.

We reveal that all of these cities can achieve—without subsidies—solar PV electricity prices lower than grid-supplied prices, and around 22% of the cities’ solar generation electricity .

We find a globally consistent rank order among technologies, with the cost of capital increasing from solar PV to onshore wind to offshore wind power. On average, the cost of capital in developing countries is significantly higher than in industrialized countries, with large heterogeneity also within the groups of industrialized or developing .

Using nation-specific, component-level price data and global PV installation and silicon price data, we estimate learning rates for solar PV modules in the three largest solar-deploying.

To accelerate the deployment of solar power, SETO has announced a goal to reduce the benchmark levelized cost of electricity (LCOE) generated by utility-scale photovoltaics (UPV) to 2¢/kWh by 2030. 3 In parallel, SETO is targeting a 2030 benchmark LCOE of 4¢/kWh for commercial PV, 4 5¢/kWh for residential PV, 5 and 5¢/kWh for concentrating .

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6 FAQs about [Solar power generation price determination]

How is solar PV power generation calculated in China?

Solar PV power generation was calculated according to the system parameters and assumptions shown in the Methods. In China, the cities with the highest and lowest solar PV power generation are Ngari (32.50° N, 80.11° E; around 1,976 kWh kW p−1) and Chongqing (29.43° N, 106.91° E; around 732 kWh kW p−1), respectively.

How much does solar energy cost?

These targets are 3 cents/kW h for utility-scale PV without incentives in an average U.S. climate (which corresponds to roughly 2 cents/kW h in the sunniest regions of the country), 4 cents/kW h for commercial PV, and 5 cents/kW h for residential PV systems.

Does China have a price threshold for solar power?

The cost of solar PV electricity generation is affected by many local factors, making it a challenge to understand whether China has reached the threshold at which a grid-connected solar PV system supplies electricity to the end user at the same price as grid-supplied power or the price of desulfurized coal electricity, or even lower.

How do energy economics models assess the cost of alternative power generation technologies?

Many models in energy economics assess the cost of alternative power generation technologies. As an input, the models require well-calibrated assumptions for the cost of capital or discount rates to be used, especially for renewable energy for which the cost of capital differs widely across countries and technologies.

What is the penetration rate of solar power in the United States?

State-level penetration ranges from 3 to 62% across the United States without low-cost storage and 13–81% with low-cost storage. 11 Because of the low cost of PV, new PV capacity is not clustered in the highest-quality solar resource areas; instead, it is spread throughout the country.

How much does solar power cost in China?

Additionally, the cost of solar PV power generation was CNY5.6–15.1 kWh −1 in 2000, which fell to CNY0.29–0.79 kWh −1 in 2018, with an average annual decrease of CNY0.28–0.75 kWh −1 (Fig. 1). Technological progress sheds light on less expensive and more commercially viable solar systems, and increases the competitiveness of the solar PV market.

Solar power generation price determination