By Editors of Power Engineering
The cost of solar generation fell from $55 per MWh in 2016 to $50 this year. In 2009, the levelized cost of solar production was $178 per MWh, making it by far the most expensive form of utility-scale electricity generation.
Similarly, the price of wind generation fell from $47 per MW/h to $45 now. Those years also show a significant drop from 2009, when the price was $85 per MW/h.
“Energy industry participants remain confident in the future of renewables, with new alternative energy projects generating electricity at costs that are now at or below the marginal costs of some conventional generation,” said Jonathan Mir, Head of Lazard’s North American Power Group. “The next frontier is energy storage, where continued innovation and declining costs are expected to drive increased deployment of renewables, which in turn will create more demand for storage.”
However, the price of coal generation remained unchanged from 2016 to 2017 at $102 per MW/h. Though the 2009 price of coal generation was $111 per MW/h, coal prices have since fluctuated and previously hit $102 per MW/h in 2012.
The price of nuclear generation spiked significantly from $117 per MW/h in 2016 to $148 this year, making it the most expensive form of generation at this time. Other than a drop from $123 per MW/h in 2009 to $96 in 2010, the price of nuclear generation has trended upward in recent years.
Combined-cycle gas generation continued its gradual decline from $63 per MW/h last year to $60 this year. 2009 saw natural gas prices of $83 per MW/h.
As for energy storage, Lazard’s report indicated it is “not currently cost-competitive in most applications,” though it remains useful for strengthening the power grid and adding value to commercial and industrial energy users. Energy storage costs are expected to decrease significantly over the next five years due to scale and related cost savings, improved standardization and technological improvements, supported in turn by increased demand as a result of regulatory/pricing innovation, increased renewables penetration and the needs of an aging and changing power grid in the context of a modern society.