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Parity Time: Large-Scale Solar Power Plants Now Cost Effective in Oregon

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"Parity Time: Large-Scale Solar Power Plants Now Cost Effective in Oregon"

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By Chris Robertson

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:

  1. 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.
  2. 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.
  3. 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.
  4. Remaining market barriers will need to be addressed. These include finance, land use, improved interconnection processes, transmission and distribution upgrades, permit streamlining, and others.
  5. 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.
  6. 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 cnrobertson@comcast.net

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4 Responses to Parity Time: Large-Scale Solar Power Plants Now Cost Effective in Oregon

  1. I actually worked on a related study, looking at the economic impacts of implementing electric-vehicle adoptions and other low-carbon fuels in the state of Oregon. The electric-vehicle adoption scenario produced by far the most eocnomically positive outcome for the state. These benefits came from the spending on EV infrastructure and from lower per-mile vehicle and fuel costs to individuals and businesses. That study can be found here: http://www.deq.state.or.us/aq/committees/advcomLowCarbonFuel.htm.

    The synergy of these two effects – cost-effectiveness of clean generation that you talk about and adoption of vehicles that have lower per-mile costs to consumers – present a real opportunity for the “win-win” scenario of large-scale environmental and economic benefits.

  2. James Richard Tyrer says:

    You mention “avoided cost rates”. That means that for this to actually be cost effective that there have to be ACTUAL costs that are avoided. In practice this means that there need to be dispatchable power plants which can be turned off when the solar plants are producing power.

  3. Sounds like an interesting and positive report.

    I have a couple of quibbles. Since the piece here is written by the report author, I’d prefer to see the piece written in the first person, so the sourcing is really clear.

    And I’m not convinced that the august term “peer-reviewed,” applied prominently in the first sentence, is meaningfully appropriate.

    The report does not appear to be peer reviewed research, in the sense of “published in a major peer-reviewed journal” – but all those words are used to give that kind of impression.

    I see something that looks similar with government agency reports from time to time. They get sent around to a bunch of connected people in the field, who reliably say, “great report, Joe!” And then they call it peer-reviewed.

    When this watered-down meaning is repeated, the ttruly important meaning of peer-reviewed science starts to get lost in the PR undertow.

    • Andy Hultgren says:

      Kevin good catch. I agree, “peer-reviewed” seems to be used quite loosely here.

      It may be best to delete that wording from the post.

      Reading the report it looks like the economic analysis includes all current federal subsidies. (See report page 15).

      It also assumes an all-in installed cost of $2.40/Watt-dc (page 27). I’m not an expert in utility-scale solar so don’t know if this is appropriate (though the report presents several cases to suggest it is).

      Finally, the post’s author (and report author, as you Kevin point out) does not seem to have very much of a background posted on his website. Not even a brief bio. I’d recommend to the author Chris that s/he put something up!

      Overall, this report looks very encouraging and I’ll be bookmarking it for future reference.