The fight between rooftop and utility-scale solar continues, with the Institute for Local Self-Reliance publishing a sharp critique of a study that suggested much lower costs for larger, utility-scale systems through 2019.
Last week, in a study for First Solar supported by the Edison Electric Institute, The Brattle Group found that utility-scale solar would be half as expensive as rooftop for a mid-sized, investor-owned utility. “The report compared the per-megawatt-hour customer supply costs of adding 300 MW DC of PV capacity in the form of 60,000 five-kilowatt residential-scale systems owned or leased by retail customers, versus 300 MW of utility-scale solar power plants,” Greentech Solar reported at the time.
The analysis concluded that “utility-scale PV power costs in Xcel Energy Colorado’s service territory will range from $66 to $117 per MWh across a range of scenarios. The projected power costs for a typical, customer-owned PV system will range from $123 to $193 MWh.”
In a counter-analysis this week on Midwest Energy News, ILSR’s John Farrell noted that Edison has been urging its private utility members to fight back against distributed solar as a “disruptive challenge,” and characterizes First Solar as a “Walmart family-supported solar developer who views rooftop solar as a competitive threat.” Farrell adds that transmission and distribution costs offset much of the price difference between the actual solar-electric systems.
Moreover, “numerous studies on the value of solar energy (and one state law) illustrate the particular grid benefits of distributed solar that utility-scale doesn’t provide, including: reduced line losses, deferred distribution system maintenance, avoided transmission capital expense, and increased resiliency,” he writes.
“Distributed solar also has substantial economic benefits, of interest to electric customers if not their monopoly utilities. For example, a megawatt of solar that is locally owned rather than utility owned means as much as $5.7 million in lifetime economic benefits for a community.”
Farrell notes that the 550-MW Topaz solar array took seven years to develop and build, “during which time over 8,000 megawatts of distributed residential and commercial solar were installed in the U.S.” In Germany, 70% of solar energy systems produce 500 kW of electricity or less, and “thousands of these distributed solar arrays are locally owned, widely distributing the economic benefits of the clean energy transformation.”
While there’s nothing wrong with utility-scale solar, Farrell concludes, “it’s neither the most economic nor fastest way to green the electricity sector, and it cements centralized control of electricity system in an era of widespread decentralized innovation. And that may be too high a price to pay.”