Solar achieves cost parity?

For decades, the ultimate threshold for solar energy was when it achieved cost pairity--that is, the point at which solar energy prices drop to a level equal to or less than conventional electric prices. After a decade of declining photovoltaic prices, it appears we might be there. Several reports over the last week have claimed solar is now either the cheapest form of new electric generation (or the second cheapest behind wind). And while these prices are still limited to paticular locations or projects, it may be a sign of things to come in 2017 if prices continue on their current downward trajectory. 

A few reports and news items that have come out in the last week include:

  • A Bloomberg analysis that reveals that solar has dropped to the price of wind and is half the cost of coal in developing markets. 
  • An article in Greentech Media that claims the Springbok 2 solar farm in Kern County, California is has just begun operating at historically low prices when inflation is factored in.
  • A report from Lazard that sought to normalize solar prices with conventional and other renewable resources and found that only wind and combined cycle gas were cost competitive with PV.

Certanly mileage will vary, depending on site, size, and other project details. But we might finally be witnessing the birth of true cost pairity for solar energy. 2017 could be an interesting year...