ITC extension opens door to sub-4¢ kWh solar era, says GTM

Share on facebook
Facebook
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Share on email
Email
Kann said sub-four cents solar could now become a common occurrence. Image: First Solar.

The expected ITC extension will open the door to utility-scale solar below four cents per kWh, according to GTM’s vice president of research Shayle Kann.

Speaking to PV Tech, Kann said the momentum of solar procurement outside of renewable portfolio standards will now continue apace.

“What's interesting about the extension for utility-scale, is what it does to this trend we had seen in the past 18 months, of significant procurement outside of mandates. Now that will just be extended. You can easily imagine that PPAs for utility-scale solar are going to start being regularly signed below four cents a kWh and below,” he said.

So far this price level has been a freak result rather than the norm.

Legislation has been passed to Congress that would keep the 30% rate till 2019 before falling to 26% the following year and 22% in 2021 before remaining permanently at 10% thereafter. The new deadlines will only require projects to have commenced construction, not to have been grid-connected as is currently the case.

“With a 30% ITC extension you have a lot of states for which solar is going to be the most economic option for utilities looking to procure any  kind of new generation. You have places like the mountain states, which have some pretty aggressive Clean Power Plan targets, you could see a lot of demand in those states, Montana, Utah, the Dakotas. Some of the south east states too where we have already seen meaningful procurement, you could see that picking up substantially now,” said Kann.

Since speaking to PV Tech, GTM has since released preliminary new forecast for US demand predicting a 54% uptick till 2020 compared to the no extension scenario.

“The ITC extension currently written into the omnibus spending bill will result in a 20GW annual solar market in the US by 2020,” said Kann in a press statement released alongside the figures. “At that rate, more solar will be installed each year than was added to the grid cumulatively through 2014.”

Read Next

June 22, 2021
More than 100 organisations representing a variety of clean energy industries have written to the Biden administration urging it to enact a ten-year extension of the Investment Tax Credit
June 15, 2021
The confidence of renewable energy investors and developers stands at an “all-time high”, a new report by the American Council on Renewable Energy (ACORE) claims, however investment must surge in the coming years if the US is to meet decarbonisation goals.
May 14, 2021
The American Council on Renewable Energy (ACORE) has said that a proposed transmission investment tax credit (ITC) in the US could spur US$15.3 billion of fresh investment in clean energy and enable an extra 42GW of wind and solar capacity to come online.
April 14, 2021
Meyer Burger is on track to start shipments of its first heterojunction (HJ) solar modules made in Germany to distributors in July.
March 25, 2021
Thin-film laser systems equipment supplier LPKF Laser & Electronics suffered from delays in receiving new expected orders from two long-stand customers last year.
January 28, 2021
The latest round-up of project news, including updates from VivoPower on its 39MWdc Molong Solar Farm, PNE USA on four acquisitions, SolarArise on its 75MW commission and EEW on a 260MW sale.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
July 6, 2021
Solar Media Events
August 24, 2021
Solar Media Events, Upcoming Webinars
October 6, 2021