Solar and wind power could be price competitive with gas-fired plants in the west of the US by 2025, according to a new study by the National Renewable Energy Laboratory (NREL).
According to the research, Californian solar and wind in Wyoming will generate cheaper electricity than gas in 2025, the year when state-wide Renewable Portfolio Standards (RPS) expire.
“The electric generation portfolio of the future could be both cost effective and diverse,” said David Hurlbut senior analyst at the NREL and the report’s lead author. “If renewables and natural gas cost about the same per kilowatt hour delivered, then value to customers becomes a matter of finding the right mix.
“Renewable energy development, to date, has mostly been in response to state mandates. What this study does is look at where the most cost-effective yet untapped resources are likely to be when the last of these mandates culminates in 2025, and what it might cost to connect them to the best-matched population centres.”
The study concludes that the end of the RPS will drive renewable energy development into the most fertile areas. It predicts that areas with direct normal insolation of 7.5 kWh per metre squared a day will receive the most attention. Germany averages around 3kWh per metre squared a day.
Solar power from Nevada and Arizona will be slightly more expensive than gas power with the cost of transmission edging it higher. These same transmission costs are likely to limit the development of utility-scale solar to the local three-state market comprised of California, Nevada and Arizona, rather than for export further afield.