"Parity Time: Large-Scale Solar Power Plants Now Cost Effective in Oregon"
The Oregon Solar Energy Industries Association has just published a major new peer-reviewed study, Vision to Integrate Solar in Oregon (VISOR). Bonneville Environmental Foundation was the principal sponsor of this work by Chris Robertson & Associates. The VISOR report can be found here.
The key findings are that:
- Large scale PV power plants are now cost effective in both PacifiCorp and Portland General Electric service areas, using PURPA avoided cost rates as the revenue stream for the plants.
- Oregon could produce 20% of its electricity from 65 square miles of land. If this was all agricultural land it would be 1/4 of 1% of Oregon’s farm land. Agricultural production (e.g. grazing small animals, honey production) could be maintained on the land.
- Building-level distributed generation is not yet cost-effective. This is due mainly to a market design that is small, fragmented and does not enable contractors to get to economies of scale.
- Remaining market barriers will need to be addressed. These include finance, land use, improved interconnection processes, transmission and distribution upgrades, permit streamlining, and others.
- A Feed-in-Tariff regime should be designed to accommodate both utility scale and building level PV DG so as to drive down costs in both market segments and achieve a “reasonable” long term average cost of solar energy resources for the grid.
- Monetizing the carbon value from installing solar makes it even more cost-effective (see figure).
The economic performance of a solar power plant built in Central Oregon and interconnected to PacifiCorp’s transmission and distribution system. The energy would be sold to PacifiCorp via a long-term power purchase agreement (PPA). PPA revenue is based on the utility’s 2012 avoided cost rates as regulated by the Oregon Public Utility Commission (PUC). The levelized $/MWh is shown for the production cost (red bars), PPA revenue (blue bars) and PPA revenue plus the value of avoided carbon emissions (green bars).
The full study is here.
– Chris Robertson is a business consultant, innovator and entrepreneur in the clean energy technology industry. For more than thirty years his work has been focused on how to accelerate the transition to a sustainable energy economy powered by renewable energy systems. Robertson can be contacted at email@example.com