New Solar + Battery Price Crushes Fossil Fuels, Buries Nuclear

Jeff McMahon Senior Contributor

Los Angeles Power and Water officials have struck a deal on the largest and cheapest solar + battery-storage project in the world, at prices that leave fossil fuels in the dust and may relegate nuclear power to the dustbin.

Later this month the LA Board of Water and Power Commissioners is expected to approve a 25-year contract that will serve 7 percent of the city's electricity demand at 1.997¢/kwh for solar energy and 1.3¢ for power from batteries.

"This is the lowest solar-photovoltaic price in the United States," said James Barner, the agency's manager for strategic initiatives, "and it is the largest and lowest-cost solar and high-capacity battery-storage project in the U.S. and we believe in the world today. So this is, I believe, truly revolutionary in the industry."

It's half the estimated cost of power from a new natural gas plant.

Mark Z. Jacobson, the Stanford professor who developed roadmaps for transitioning 139 countries to 100 percent renewables, hailed the development on Twitter Friday, saying, "Goodnight #naturalgas, goodnight #coal, goodnight #nuclear."

The nuclear critic Arnie Gundersen, who predicted storage prices under 2¢/kwh four years ago on the night Elon Musk unveiled the Tesla Powerpack, noted Saturday that his 2015 prediction was too high. He too said, "Goodbye coal, nukes, gas!"

The Eland Project will not rid Los Angeles of natural gas, however. The city will still depend on gas and hydro to supply its overnight power. But the batteries in this 400-megawatt project will take a bite out of the fossil share of LA's power pie.

"It reduces the evening ramp (of natural gas) as the sun sets," Barner told commissioners at their June 18 meeting. "As the sun goes down for our other 1,000 MW of solar that doesn’t have batteries, the gas-fired generation and hydro have to compensate for that. So that net peak load in the evening will be offset with this facility. We’ll be able to contribute to that and keep gas powered generation not running at the full amount."

Crudely, Los Angeles can count on solar power generation from 7 a.m. to 7 p.m., said Louis Ting, director of power planning development at the agency. The batteries in this project effectively extend that horizon four hours, to 11 p.m.

"The battery can be dispatched differently," Barner added, "depending on the system need. So you could run that four-hour battery over 16 hours at one-fourth of the output, so you can vary it over time. It’s not just fixed over four hours."

The plant will be developed by 8minute Solar Energy on 2,653 acres of privately-owned land in the Barren Ridge renewable corridor in Kern County. The development was first reported Friday by John Weaver at pv magazine, who noted in comments that the price for battery storage is not added on top of the solar price. It's a separate power product, sold at 1.3¢.

Barner explained that the plant will be able to generate more solar energy each day than the available transmission capacity. The extra power will be stored.

"The solar is inherently variable, and the battery is able to take a portion of that solar from that facility, the portion that’s variable, which is usually the top tend of it, take all of that, strip that off and then store it into the battery, so the facility can provide a constant output to the grid. It can turn this solar facility, which is not typically dispatchable, into a dispatchable type of facility."

The plant is expected to deliver its first megawatt by April 2023, a timeline that qualifies it for the federal solar investment tax credit.

"This project is able to make full use of that investment tax credit, which is substantial," Barner said. "It’s 30 percent that is basically knocked off the capital cost of the project."

A natural-gas plant opening that same year would produce power at more than twice the price, according to the U.S. Energy Information Agency, or 4¢-4.3¢/kwh. The agency did not bother modeling the estimated cost of coal or nuclear plants in its 2019 Energy Outlook because, it says, none are expected to be built. Nuclear often benefits from optimistic estimates in the range of 12¢/kwh. Nuclear's advantage has been its constancy and reliability, an advantage cheap storage increasingly challenges.

The lowest known solar price is 1.97¢ for a project in Mexico that did not include storage.

LA is partnering with the city of Glendale on this project, one of eight the staff is negotiating with renewables developers.

Ratepayer advocate Fred Pickel cautioned commissioners to anticipate even lower prices for energy storage:

"Seven years ago the first major projects were brought forward to this board. They’re in service now, they’re the ones that are referred to in or near Nevada. And they were between $90 and $100 a megawatt hour or 9 and 10 cents a kilowatt hour. Now we’re seeing solar projects under 2 cents a kilowatt hour. And I think it’s important to keep the speed of that technology change in mind as we think about batteries and other things. We’re placing bets of how quickly we move vs. how quickly the technology might move, and it is helpful to have a diversified approach to this."

"Is it your view that this steep price decreases will continue?" asked Commissioner Mel Levine.

"It’s a gamble," Pickel said. "You've got to know when you're gambling."

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Just to name a few.


Solar tracking mounts

As solar starts to reach mainstream status, more and more homeowners are considering solar – even those who have roofs that are less than ideal for panels. Because of this expansion, ground mounted solar is becoming a viable clean energy option, thanks in part to tracking mount technology.

Trackers allow solar panels to maximize electricity production by following the sun as it moves across the sky. PV tracking systems tilt and shift the angle of a solar array as the day goes by to best match the location of the sun. Though this panel add-on has been available for some time, solar manufacturers are truly embracing the technology. GTM Research recently unveiled a recent report that shows a major upward trend in the popularity of tracking systems. GTM projects a 254 percent year-over-year increase for the PV tracking market this year. The report stated that by 2021, almost half of all ground mount arrays will include solar tracking capability.

A good tracker can certainly help keep a panel operating at best efficiency.  But the typical efficiency claims are based on an optimal angle of incident, and not the real world performance.  

In terms of predicting future efficiency, its a little dated but here you go:


In this image, we can see individual predictions for many of the technologies we have introduced above. These predictions are made for a fixed module size (60 cells with dimensions of 156 mm x 156 mm). In terms of efficiency, this is equivalent to:

  • Approximately 20% for the low-end technologies (such as p-type multi-crystalline Al-BSF), up from about 17% today.
  • Approximately 26% for the high-end technologies (such as n-type monocrystalline IBC), up from about 21% today.

This means that in 2027, an average premium module will be able to convert more than a quarter of all incident solar energy to electricity.

If these predictions prove to be correct, the result will be a very significant increase (roughly 20%, relative) on today’s product. This will be a remarkable example of continued innovation for an industry, which, already more than 60 years old, is already very mature...

That said, this got me excited the other day:

..Harris and Silicon Ranch are putting together a plan to rotate animal species around the solar farm, possibly cattle and sheep. The animals would graze on grass and weeds and naturally fertilize the land with their manure. In between grazing periods, the land would have time to recover. Grazing in this way could prevent erosion and, down the road, potentially sequester carbon in the soil, as Harris has achieved on his own land. But it could take years....

Corporate Average Fuel Economy (CAFE) roughly doubled between 1975 and 2017    I wouldn't project that out into the future however.  Just like solar panels, there will be limits to how much of the energy in the fuel (in this case hydrocarbons) that can be converted to useful work.  

I do think the most important part of this for our GHG readers is concept of a renewable energy cap on the average price of natural gas.  I don't know exactly what that number is right now, but for the sake of argument, if utilities anticipated sustained natural gas prices in excess of say $5/mcf (inflation adjusted) very few would build new natural gas power plants, and most would build wind/solar or others, with energy storage.  The more efficient solar, wind, or storage become, the lower the cap on natural gas prices before switching occurs.   

Thanks, dbob.  All good points.  We tend to discuss domestic renewables for obvious reasons however when we look globally Solar + Storage will have profound advantages over natural gas.  The cost to start from scratch to convert a country or region's energy system to natural gas (LNG) requires a deep water port, re-gasification facilities and a pipeline system with associated infrastructure. In many under-developed countries, it won't just be the price of the commodity but the ability to build out solar micro-grids that will decide demand.  This will be a huge innovation for poorer parts of the world and will hasten the falling demand for hydrocarbons of all kinds.


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