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All things energy, from solar and wind power to efficiency and off-grid living.

Solar Energy Prices at All-Time Low

According to a study published last month, the cost of solar power has reached an all-time low, with a reported new average of 5 cents per kilowatt-hour (kWh). The study, conducted by the Lawrence Berkeley National Laboratory, demonstrates a decline of 70 percent in PPA prices since 2009, among other stats highlighting the cost and efficiency of solar energy.

The Findings

Each year, the Berkeley Lab publishes a Utility-Scale Solar statement, which reports new findings about utility-scale solar projects based on vast amounts of empirical data. Utility-scale refers to large, ground-mounted solar projects of more than 5 megawatts (MW).

Here’s a roundup of key findings from this year’s Utility-Scale Solar report.

1. The cost of installation has decreased by more than 50 percent since 2009.

2. Efficiency of new solar technology has increased from an average capacity factor of 24.5 percent in projects completed in 2011 to 29.4 percent in projects completed in 2014.

3. The new low average price of 5 cents per kWh has made solar power a competitive option in states outside of the Southwest, where solar power is most widely used. Notably, Southeastern states Arkansas and Alabama are seeing more solar development than ever before.

What This Means

For Consumers

While this new low average price can be partially attributed to improved project performance and lower installation costs, the standing 30 percent federal investment tax credit incentive will fall to 10 percent after 2016. As such, solar technicians are rushing to build projects before the upcoming tax credit decline. Smaller-scale solar companies are competing for space with larger installers, as evidenced by an increase of more than 50 percent for solar panel installation in 2014.

To put these findings in perspective, standard electricity providers earn an average of slightly less than 11 cents per kWh, as of the September update from the U.S. Energy Information Administration. The price is lowest for industrial applications, with an average of 7.3 cents revenue per kWh. Ultimately, this makes solar power a highly competitive option for utility-scale applications.

For the Economy

Scientists have long advocated the advantages of a widespread move toward solar energy, stating it will provide jobs and other economic benefits in addition to helping stabilize energy prices nationwide. In contrast to wildly fluctuating fossil fuel prices, renewable energy technologies – like solar – operate at a consistently low cost after installation.

For the Environment

Fossil fuels like oil and coal remain the largest source of energy, even though they are finite resources. Solar energy, on the other hand, is available in abundance. As such, the new low costs and competitive, widespread installation of solar technology also points to environmental benefits, including reduced air pollution and greenhouse gas emissions. For example, a 2009 UCS report predicts that an increase to 25 percent national renewable electricity standard by 2025 would drastically lower CO2 emissions from power plants by around 277 million metric tons per year.

Some analysts are thinking even further ahead. According to a study conducted by the U.S. Department of Energy, global warming emissions could be reduced by as much as 81 percent with a move toward renewable energy, which ideally would comprise 80 percent of the country’s electricity by 2050.

Where Solar Works Best

For parties interested in making the switch to this form of renewable energy, it’s important to know how solar energy works. Most solar systems are grid-tied, which means they connect to the utility grid for backup energy during nighttime hours and on overcast days. A successful switch to solar depends on large-scale variables, such as proximity to the equator, as well as smaller-scale variables, such as the specific environment surrounding the property. For example, trees and tall buildings create shade, which hinders the efficacy of solar technology.

If you’re deliberating making the switch, take the big picture into account. You’ll want to consider factors like installation costs, federal tax credits and the amount of sunlight your region receives on average – and consulting an expert can definitely help. It’s also a good idea to look at the projected timeline for federal incentives, especially because tax credits are projected to drop significantly within the next two years.

Ultimately, the data points to solar power as a highly viable option, and the low current cost means greater energy savings. For many consumers, this will eventually pay for the cost of installation and then some.

Photo credit Alan Levine

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10/24/2015 4:31:59 AM

It is really been tremendous, if it works. It would be amazing project. Although solar energy have low cost price but if we think, it would be beneficial for us, as the low price energy saves greater the energy, and if we use the solar energy as renewable energy form, it works tremendously and cover all the needs more efficiently. Shemekia Bailey - System Controller at

10/24/2015 4:29:28 AM

It is really been tremendous, if it works. It would be amazing project. Although solar energy have low cost price but if we think, it would be beneficial for us, as the low price energy saves greater the energy, and if we use the solar energy as renewable energy form, it works tremendously and cover all the needs more efficiently. Shemekia Bailey - System Controller at

10/22/2015 3:50:08 PM

This post is from Lucy, who lives in Australia: Don't kid yourself Brenda. Nobody started from further behind the 8-ball when I put up my first solar panel in 1981. It was a 2nd-hand 45 watt (second biggest available back then!) Unisys panel which cost me $13.80 per watt.....or about a month's average wages at the time. It took about 2 years for me to accumulate 5 panels of about the same size. Of course, at the price every watt was counted ~ and accounted for. The result of that was that I quickly learned the secret lay in adapting your lifestyle to suit your resources; not the other way a round, as is the contemporary ingrained attitude. There are many ways to achieve that, depending on how far you're able/willing to go. One thing I did was to go to bed and get up with the chooks ~ ir order to save on power needed to operate in the dark. Another was to (initially) run a simple 12-volt circuit around the house and tap into that to run a very few auto tail-lights (from the wrecker's) one at a time. Or, when I was watching my TV ( 12-volt,6-inch screen) at 8 watts, not using the lights at all, but relying on the light from the TV ~ which was positioned so that I could see to make a cup of coffee in the kitchen. I designed the ~ muddy ~ house specifically for energy-efficiency (much of it gleaned from ME and the OZ version called 'Grassroots') , and you wouldn't believe how gratifying it was to see it all work as planned. Better in some cases! Feel free to contact me at if you want more. Bottom line is that these days (living in town) I get by without stinting on 2.5 kw of panels (which cost less than the first a couple of hundred watts I I started with) which produce a year-round average of 8kwh per day. But early learning has stuck, and I get by happily enough on under THREE kwh per day. Meanwhile, the power company tells me, 'average' use of power in my region lies between 23 and 33 kwh per day. Incidentally, those first six panels of mine are these days working for an old mate of mine ~ and still producing power (30+ years later) at 85% of their rated value. ---> I gave her those because at the time I had no use for them. Heavy cabling came (free) from a factory being demolished. Frames (adjustable) for mounting can be found at the tip in the form of dumped angle-iron bedframes. etc.. We used to get good 2nd-hand batteries for next nothing from the SEC and/or a local tip used by a woodchip producer. (and recycled them as insulating/heating walls/floors in hothouses!) Motto:- Never buy new what you can recycle. (Could tell you stories.) Another motto:- You're never beaten until you give up. All the best

10/21/2015 10:51:03 AM

I have always wanted solar and or wind power. It just isnt possible for people living on low income.