Pixie Chart of the week | New US solar on par with extant coal: Lazard

Lazard published its annual update to the costs of electricity generation and storage in the USA on 8 November. The reports, Lazard’s Levelized Cost of Energy Analysis (v12.0) and Lazard’s Levelized Cost of Storage Analysis (v4.0) show a continued decline in the costs of alternative energy technologies. Significantly, the costs for new-build utility-scale solar PV arrays and onshore wind turbines were shown to have fallen to or below the marginal costs of operating conventional generation in the US.

As shown in our chart this week, utility-scale solar deployment and onshore wind were costed at $36-44/MWh (£28-35/MWh) and $29-56/MWh (£23-44/MWh) respectively. These are 13% and 7% lower than the same figures last year, are below the costs of building new coal or nuclear plants, and in line with the lower end of new CCGT costs. Furthermore, the mid-point for unsubsidised new solar sits within the range for operating the average US coal plant, $27-45/MWh (£21-35/MWh).

To keep reading, please log in to your account

Alternatively, please sign up to receive free market insight online and direct to your inbox

Related thinking

Low carbon generation

Australian Chart of the week | 3 2 1… fight: VRE and price cannibalisation in NEM

In the last decade, the rapid decline in deployment cost of variable renewable energy (VRE) generation capacity has given renewables an advantage over fossil fuels for new builds as highlighted in ‘Renewable Power Generation Costs in 2020’ report from the International Renewable Energy Agency (IRENA). In the report, Australia has...

Low carbon generation

Australian Chart of the week | VRE pays more as PFR helps reduce coal FCAS costs

In our previous ‘Chart of the week’ in November 2020, we reviewed the increasing percentage of causer pays cost that solar generators bear due to their generation profiles and how this results in them paying significantly more of the causer pays cost as a ratio of the generation they provide. More than...

Commercial and market outlook

Australian Chart of the week | Two roller coaster rides for the price of one? Preliminary vs final MLFs

In recent years, movements in marginal loss factors (MLFs) have received significant attention in the National Electricity Market (NEM). Many renewable projects in remote areas have experienced material MLF reductions as more supply connects nearby. For example, the MLF for Broken Hill Solar Farm saw a whopping 50 ppt drop...

Low carbon generation

Australian Chart of the week | A view of captured prices by technology in New South Wales

This Chart of the week examines the historical captured prices of selected technologies within NSW for the last 10 years. Figure 1 shows the historical rolling monthly average of captured prices of various technologies within New South Wales against the monthly generation of variable renewable resources including small scale rooftop....

Low carbon generation

Australian Chart of the week | Is the market putting the brakes on distributed solar exports?

In most states, electricity retailers determine and set their own rooftop solar feed-in tariffs (FITS). A major driver is the wholesale energy prices, which continue to decline midday. For more information, please refer to our previous Chart of the Week issue 76. As the solar weighted wholesale energy prices reduce or become...

Energy storage and flexibility

Australian Chart of the week | Winds of change: Victoria and its unique afternoon ‘belly bump’

To say the transition is well and truly underway in the Australian NEM is not exactly news. In the last year alone, renewables have delivered record shares in generation mix across the NEM. Whilst solar is the technology often in the news given its impact on both operational demand, mid-day...

Low carbon generation

Australian Chart of the week | Out of sight, not out of mind: DER record growth continues

The growth in behind-the-meter distributed energy resources (BTM DER) has been a key feature of the NEM over recent years. BTM solar has grown from ~1-2% of total energy supplied five years ago to ~6% this year. In fact, looking within the day, the percentage of supply being provided by...

Low carbon generation

Australian chart of the week | SA shatters record: lets talk about the elephant in the room…

As springtime rolls around in the NEM, those with interest in the market are always keeping an eye on South Australia to see just how low operational demand will go and when (not so much if) the record will be broken. This year has not disappointed. On 11 October 2020...