Study Finds Solar Could Provide 10% of U.S. Generation by 2025

A new study from Clean Edge says that solar energy could reach cost parity with retail-electricity rates in most regions of the U.S. in less than a decade. The “Utility Solar Assessment (USA)” study, produced by Clean Edge and Co-op America, provides a roadmap for utilities, solar companies and regulators to reach 10% solar in the U.S. by 2025.

The study finds that significantly scaling solar power in the U.S. will require the active involvement of utilities and delivers a to-do list to reach this goal for the three key stakeholders in the nation’s solar industry.

Utilities will need to take advantage of the value of solar for peak generation and alleviating grid congestion, implement solar as part of the build-out of the smart grid and adapt to new market realities with new business models, according to the study.
 
Solar companies must bring installed solar systems costs to US $3 per peak watt or less by 2018, streamline installations and make solar a truly plug-and-play technology, Clean Edge said. In addition, regulators and policy makers will need to pass a long-term extension of investment tax credits (ITC) for solar and other renewables, establish open standards for solar interconnection and give utilities the ability to “rate-base” solar.

The study finds that:

  • As solar prices decline and the capital and fuel costs for coal, natural gas, and nuclear plants rise, the U.S. will reach a crossover point by around 2015.
  • Installed solar PV prices are projected to decline from an average US $5.50-$7.00 peak watt (15-32 cents kWh) today to US $3.02-$3.82 peak watt (8-18 cents kWh) in 2015 to $1.43-$1.82 peak watt (4-8 cents kWh) by 2025 

“One of the big takeaways from this report is that, in many ways, the future of solar is in the hands of utilities,” said Ron Pernick, Clean Edge Co-founder and Managing Director and USA Study Co-author. “Reaching 10 percent of our electricity from solar sources by 2025 will require the active participation of utilities along with the support and participation of regulators and solar technology companies.”

The USA study is available for free download from Clean Edge.

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