NewEnergyNews: TODAY’S STUDY: PAST AND FUTURE PV PRICES

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YESTERDAY

THINGS-TO-THINK-ABOUT THURSDAY, December 8:

  • TTTA Thursday- The Record Of The New EPA Head
  • TTTA Thursday-The Undeveloped New Energy
  • TTTA Thursday-Walking On New Energy
  • TTTA Thursday-Electric Tractor For Emissions-Free.Farming
  • THE DAY BEFORE

  • ORIGINAL REPORTING: Turning Distributed Energy From Threat To Opportunity
  • ORIGINAL REPORTING: Solar Policy Action Heats Up
  • ORIGINAL REPORTING: Maine’s Almost Solar Policy Breakthrough
  • THE DAY BEFORE THE DAY BEFORE

  • TODAY’S STUDY: How To Balance Competing Solar Interests
  • QUICK NEWS, December 6: Sliver Of Hope? Al Gore In Climate Change Meet With Donald Trump; The Opportunity In New Energy; Google Seizing New Energy Opportunity
  • THE DAY BEFORE THAT

  • TODAY’S STUDY: A Way For New Energy To Meet Peak Demand
  • QUICK NEWS, December 5: Trial Of The Century Coming On Climate; The Wind-Solar Synergy; The Still Rising Sales Of Cars With Plugs
  • AND THE DAY BEFORE THAT

  • Weekend Video: Trump Truth And Climate Change
  • Weekend Video: The Daily Show Talks Pipeline Politics
  • Weekend Video: Beyond Polar Bears – The Real Science Of Climate Change
  • THE LAST DAY UP HERE

  • FRIDAY WORLD HEADLINE-Aussie Farmers Worrying About Climate Change
  • FRIDAY WORLD HEADLINE-The Climate Change Solution At Hand, Part 1
  • FRIDAY WORLD HEADLINE-The Climate Change Solution At Hand, Part 2
  • FRIDAY WORLD HEADLINE-New Energy And Historic Buildings In Europe
  • --------------------------

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    Anne B. Butterfield of Daily Camera and Huffington Post, f is an occasional contributor to NewEnergyNews

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    Some of Anne's contributions:

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT), November 26, 2013
  • SOLAR FOR ME BUT NOT FOR THEE ~ Xcel's Push to Undermine Rooftop Solar, September 20, 2013
  • NEW BILLS AND NEW BIRDS in Colorado's recent session, May 20, 2013
  • Lies, damned lies and politicians (October 8, 2012)
  • Colorado's Elegant Solution to Fracking (April 23, 2012)
  • Shale Gas: From Geologic Bubble to Economic Bubble (March 15, 2012)
  • Taken for granted no more (February 5, 2012)
  • The Republican clown car circus (January 6, 2012)
  • Twenty-Somethings of Colorado With Skin in the Game (November 22, 2011)
  • Occupy, Xcel, and the Mother of All Cliffs (October 31, 2011)
  • Boulder Can Own Its Power With Distributed Generation (June 7, 2011)
  • The Plunging Cost of Renewables and Boulder's Energy Future (April 19, 2011)
  • Paddling Down the River Denial (January 12, 2011)
  • The Fox (News) That Jumped the Shark (December 16, 2010)
  • Click here for an archive of Butterfield columns

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  • WEEKEND VIDEOS, December 10-11:

  • A Climate Change Denier’s Lies Exposed
  • The Good News Numbers On The EV Boom
  • “This Is Just The Beginning”

    Monday, October 14, 2013

    TODAY’S STUDY: PAST AND FUTURE PV PRICES

    Photovoltaic System Pricing Trends: Historical, Recent, and Near-Term Projections, 2013 Edition

    David Feldman, Galen Barbose, Robert Margolis, Naïm Darghouth, Ted James,

    Samantha Weaver, Alan Goodrich, and Ryan Wiser, July 16, 2013 (National Renewable Energy Laboratory and Lawrence Berkeley National Laboratory)

    Introduction

    • There exists a need for reliable and comprehensive information on PV system pricing

    • Rapid market growth and changes to PV system pricing in recent years

    • Policy support for PV deployment premised on stimulating cost reductions through market scale and development

    • DOE SunShot Initiative seeks to reduce PV system prices 75% over the 2010-2020 period.

    • This briefing provides a high-level overview of historical, recent, and projected near-term PV system pricing trends in the United States, drawing on several ongoing research activities at LBNL and NREL:

    • LBNL’s annual Tracking the Sun report series

    • NREL’s bottom-up PV cost modeling

    • NREL’s synthesis of PV market data and projections.

    Executive Summary

    • Reported pricing data that, among ~50,000 PV systems installed in 2012:

    • Res. and small com. (≤10 kW) was $5.30/W (median)

    • Large com. (>100 kW) was $4.62/W (median)

    • Utility-scale (crystalline, fixed-tilt, >2 MW) was $3.35/W (capacity weighted average).

    • Modeled overnight capital cost for systems quoted in Q4 2011 (expected to be installed in 2012):

    • Residential (5.1 kW) was $4.22/W

    • Commercial (221 kW) was $3.22/W

    • Utility-scale (191.5 MW) was $2.50/W.

    • Delta between reported pricing and modeled cost is due to various factors, such as inefficient pricing, timing, geographic location, and project specifics.

    • Reported installed prices of residential and commercial PV systems declined 6%–7% per year, on average, from 1998–2012, and by 6%–14% from 2011–2012, depending on system size.

    • In near future analysts expect system prices to continue to fall, but for module prices to stabilize (Module ASP projected to be between $0.50/W - $0.75/W by 2014 ).

    • Modeled overnight capital cost for systems quoted in Q4 2012 (expected to be installed in 2013):

    • Residential (5.1 kW) was $3.69/W, a reduction of 13% from Q4 2011

    • Commercial (222.5 kW) was $2.61/W, a reduction of 19% from Q4 2011

    • Utility-scale (192.8 MW) was $1.92/W, a reduction of 23% from Q4 2011.

    Data Sources and Methodology for Reported Installed Prices

     Derived from project-level data reported for residential, commercial, and utility-scale PV systems installed through year-end 2012, with a limited set of results presented for the first half of 2013

     Distributed PV: 47 PV incentive programs spanning 24 states provided project level installed price data for PV systems funded through current and previous programs

     Utility-scale PV: Data sourced from Section 1603 Grant Program, FERC Form 1, SEC filings, company presentations, trade press articles

     All projects for which the reported installed price was deemed likely to represent an appraised value rather than an actual transaction price were eliminated from the data sample

     Final cleaned data sample consists of >200,000 PV systems totaling 4.7 GW of installed capacity; represents approximately 65% of all grid-connected PV capacity installed in the United States through 2012 and about 50% of all 2012 capacity additions.

    Median Reported Installed Price of Residential and Commercial PV Systems over Time

    • Since 1998, installed PV system prices have fallen by 6-7% per year on average

    • From 2011 to 2012, installed prices fell by $0.88/W (14%) for systems ≤10 kW and by $0.30/W (6%) for systems >100 kW

    • By comparison, global annual average module prices fell by $0.52/W from 2011-2012.

    Preliminary Price Trends for Systems Installed in 2013: A Focus on California

    • Data from the California Solar Initiative (CSI) program show that installed prices have continued to fall into 2013

    • Median installed prices in CSI fell by roughly $0.53-0.77/W (10-15%) during the first half of 2013, relative to 2012, across the three size ranges shown.

    Variation in Installed Price by System Size: Residential and Commercial PV Systems in 2012

    • Installed prices exhibit clear economies of scale, with the median installed price for the largest commercial systems 38% lower than for the smallest residential systems (and lower installed prices for utility-scale PV, as shown on later slides)

    • Scale economies are especially pronounced at the small end of the size spectrum

    • Substantial variability in installed prices exists within each size range, reflecting regional, local, project/site-specific, and installer-specific drivers.

    Variation in Installed Price by State: Residential and Small Commercial (≤10 kW) PV in 2012..Variation in Installed Price by State: Large Commercial (>100 kW) PV Systems in 2012...

    Installed Price Data for Utility-Scale PV: Important Notes and Caveats

    • Capacity-weighted average installed price was $3.35/W for crystalline, fixed-tilt projects installed in 2012, down from $3.59/W in 2011, a 7% decline YoY

    • Capacity-weighted average installed price was $3.60/W for crystalline tracking systems and $3.23/W for thin-film, fixed-tilt systems completed in 2012

    • A wide distribution in installed prices is observed, partially reflecting variation in system size (shown on following slide) and other project characteristics.

    Installed Price of Utility-Scale PV Projects Over Time

    • Capacity-weighted average installed price was $3.35/W for crystalline, fixed-tilt projects installed in 2012, down from $3.59/W in 2011, a 7% decline YoY

    • Capacity-weighted average installed price was $3.60/W for crystalline tracking systems and $3.23/W for thin-film, fixed-tilt systems completed in 2012

    • A wide distribution in installed prices is observed, partially reflecting variation in system size (shown on following slide) and other project characteristics.

    Bottom-up Modeled Overnight Capital Cost of PV Systems by Sector, Q4 ’09 - Q4 ’12…Bottom-up Modeled Overnight Capital Cost of PV Systems by Sector, Q4 ’09 - Q4 ’12…Bottom-up Modeled Overnight Capital Cost of Utility-Scale PV Systems by Size…

    Reasons for Deviations Between Reported Price and Bottom-Up Benchmark Overnight Capital Cost

    • Price vs. cost

    • Reported pricing reflects what a customer will pay for a system (i.e., what the market will bear). A customer’s purchase price may be significantly higher than it would be elsewhere, regardless of the underlying cost to the installer, due to:

    • Higher electricity rates (e.g., CA)

    • Greater incentive programs (which may lower a customer’s upfront cash outlay, though not the price paid to the installer)

    • Barriers to entry within specific markets, etc.

    • The bottom-up benchmarks are reflective of consistent, transparent assumptions of the cost and representative margins of each subcomponent to an installer, regardless of market conditions or incentives.

    • Timing

    • Reported pricing generally reflects module and other component pricing at the time that installation contracts were signed (could precede installation date by more than a year for large projects)

    • Bottom-up benchmark costs are contemporaneous with time subcomponent pricing estimates. Q4 benchmarks are compared with the following year, but may not fully capture lag between price quote and installation date.

    • Geographic location

    • Reported price is weighted heavily toward California and New Jersey

    • Bottom-up benchmark based on national averages.

    • Project specifics

    • Projects within dataset of report pricing includes systems not currently modeled in bottom-up benchmark, such as those using high-efficiency panels, high proportion of government facilities, and relatively small utility-scale projects…

    Installed Price of Residential & Commercial PV Systems: U.S. Systems Installed in 2012 vs. German Systems Quoted in 2012…

    Median and Range of Analyst Expectations of Module Average Selling Price

    • Module prices in 2012 continued recent trend of dramatic reductions

    • Since 2008 has fallen on average 35% per year

    • Mixed forecasts on future module ASP

    • However, not expected to increase or decrease dramatically in price

    • By 2014 ASP projected to be between $0.50/W - $0.75/W

    • Major system price reductions are not expected to come from PV module price alone, as was the case in previous years.

    Analyst Estimates (2012) and Projections (2013–2014) of Global Average System Price

    • Analysts expect the system prices of both utility-scale and distributed systems to continue to fall in the near future

    • Distributed systems are expected to reach between $2/W - $4.75/W by 2014

    • Utility-scale systems are expected to reach between $1.50 - $3.15/W by 2014.

    Conclusion

    • Continued system price reductions in 2012; more expected in the near-term, despite tensions on trade issues

    • Reported system pricing fell 6-14% from 2011-2012

    • Modeled overnight capital costs fell 13-23% from Q4 2011 to Q4 2012.

    • Despite general downward trend, large variation in reported pricing within market segment in 2012

    • A difference of roughly $2/W in median installed price between the lowest- and highest-priced states for residential & commercial systems ≤10 kW, but similar variability also exists within individual states

    • Ground-mounted systems ≥2 MW ranged in price from $2/W to above $6/W.

    • Difference between reported price and bottom-up benchmark overnight capital cost for similarly segmented systems in 2012

    • Residential ($5.30/W reported price, $4.22/W bottom-up benchmark overnight capital cost); commercial ($4.62/W reported price, $3.22/W bottom-up benchmark overnight capital cost); utility-scale ($3.35/W reported price, $2.50/W bottom-up benchmark overnight capital cost)

    • Delta between reported pricing and modeled cost is due to various factors, such as inefficient pricing, timing, geographic location, and project specifics.

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