A number of readers asked us for a chart on the levelized cost of electricity of renewables versus fossil resources. Here’s a good one just released by the Institute for Local Self Reliance with data from Lazard, a Wall Street advisory firm that tracks energy data. The chart includes the cost of renewables with and without tax incentives.
The takeaway? While renewables have higher upfront capital costs per MW of capacity, the actual cost of electricity over time is very competitive.
According to a report released this week by three leading solar researchers, the value of solar PV is between 3 and 14 cents a kilowatt-hour for a utility. The contributing factors include: stabilizing the grid during peak times, requiring less infrastructure for transmitting electricity and, of course, the reduction in GHG emissions and particulates. The Institute for Local Self Reliance illustrates the findings:
There’s also another way to look at the value of renewables: Through the economic impact to local communities.
On a levelized cost basis, renewables are becoming very competitive today. But when you factor in the myriad benefits related to grid stability, local economic impact, and environmental health, we’re talking about a very attractive proposition.