Utilities Can Make Solar 10% of Electric By 2025

It’s no longer entirely up to individual companies and individual investors to make solar a significant source of US electricity – rather, if it is going to happen, it is up to utilities.

Clean Edge and Co-op America have released a report analyzing the roles of utilities in getting solar to be a viable source of electricity generation, and says it could be the source of 10% of US electricity Generation by 2025. Their 76 page report, the Utility Solar Assessment (USA) Study, provides a map for utilities, regulators and solar companies to reach the goal – and they all must get in sync if this goal is to be achieved.

A few of the major points include utilities using solar to alleviate grid congestion; for solar companies to get systems to $3 or less per peak watt within 10 years (and grid parity is within reach sooner than that) and make solar a “plug-and-play” technology; and for regulators to pass investment tax credits for solar and other renewables (remember, ITCs were not renewed).

The transition won’t be cheap. According to Clean Edge, the investment to get us to using 10% solar will average $26 billion to $33 billion a year until 2025. But considering utilities spent about $70 billion on new power plants and transmission and distribution systems in 2007 alone, it is pretty likely that we can scrounge up the funds to make solar a serious component of our electricity use. Additionally, according to the report, installed solar PV prices are expected to shrink from $5.50-$7.00 per peak watt to $3.02-$3.82 per peak watt within 7 years, and then shrink again to $1.43-$1.82 per peak watt by 2025, making solar increasingly un-ignorable. And, as Intel’s SpectraWatt spin off illustrates, solar is soon to be ubiquitous.

On a press call this morning, Ron Pernick, co-author of the report and Clean Edge cofounder, pointed out that while solar is within striking distance of fossil fuel, thanks to the rising cost of oil and shrinking cost of solar, the future of solar is really in the hands of utilities.

Thankfully, utilities are indeed stepping up to the plate. Southern California Edison is looking to install 250 MW, Duke Energy is investing $100 million in rooftop solar, and PG&E is investing in thousands of megawatts of concentrating solar power in California deserts, as well as other solar hybrid projects. We are certainly making progress already.

For your reading pleasure, the USA Study is available for free download at www.cleanedge.com and www.solarcatalyst.org

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