A new report out from Lazard tells us something those who follow the wind and solar industries already knew to some degree: large-scale solar and wind power projects can now compete purely on cost with natural gas power plants (as well as coal and nuclear, of course). Solar panels cost less than electricity from any other source in some regions, and the cost continues to fall.
Wind power, meanwhile, is often the cheapest option for new electricity generation capacity. However, it often produces electricity in the middle of the night, complementing solar panels.
Worth noting is that this has long been the case with renewable energy subsidies, but the point of the report is that it’s also the case without those subsidies in a growing number of places, even while fossil fuels retain their subsidies.
The new report from Lazard notes that onshore (unsubsidized) wind power costs have fallen from a low of $101/MWh in 2009 to $37/MWh in 2014, a drop of approximately 65%.
Solar farm costs have fallen from a low of $323/MWh in 2009 to $72/MWh in 2014, a drop of approximately 80%.
Rooftop solar panels cost much more (per kWh) than utility-scale solar panel setups, but the important thing is that rooftop solar panel costs compete with retail electricity prices rather than wholesale electricity prices coming from large power plants. While solar farms are just hitting “grid parity,” more-expensive rooftop solar panels have been at “socket parity” for millions or hundreds of millions of Americans for years.
Is the cost of solar panels going to fall further? Of course it is, but every year that you wait to go solar, you pass up massive savings off of your electricity bill. Also, solar panel subsidies at the federal, state, and local levels won’t last forever, so taking advantage of them now is quite logical. In my opinion, for many people, there’s no better time to go solar than right now.