Oct. 23, 1019 (IEEFA) — Deals for utility-scale solar installations are accelerating on tribal lands in the Southwest U.S., finds a report published today by the Institute for Energy Economics and Financial Analysis (IEEFA).
The report, Tribal Utility-Scale Solar Initiatives Advance Across Southwest U.S., cites the emergence of battery-storage technology, state energy policy changes and the rapidly falling prices of utility-scale solar as driving factors.
Three tribes are advancing the trend:
Utility-scale solar has become more affordable than gas- and coal-fired generation
“All the deals are tied to long-term power purchase agreements (PPAs) that run from 15 to 25 years, and pricing on the most recent ones—ranging from roughly $21-$23 per megawatt-hour (MWh)—shows why utility-scale solar has become so attractive,” the report states. “Gas- and coal-fired electricity generation, by comparison, are much more expensive.”
The report notes, for example, industry details from Lazard’s most recent annual levelized cost of electricity data update, which put the cost of coal-fired generation nationally at $60-$143/MWh and gas-fired generation at $41-$74/MWh. The unsubsidized cost for wind ranged from $29-$56/MWh, with the subsidized cost falling as low as $14/MWh. Lazard estimated the unsubsidized price of utility-scale solar at $36-$44/MWh.
“That estimate now seems behind the times,” the IEEFA report states.
The report notes nonetheless that tribal lands in the Southwest U.S. remain vastly underdeveloped on the utility-scale solar front and that enormous opportunity exists for deals between utility companies, tribal governments, and tax-equity developers.
“Tribal lands of the Southwest U.S. are far and away the largest single repository of utility-scale solar potential, but development of these resources has moved at an almost-glacial pace,” the report states. “Indications are that a paradigm shift is at work, however, as tribal interests begin to partner with developers that bring tax-advantage incentives to the table and with utility companies driven by the low cost of utility-scale solar; state mandates also in some instances are helping propel the uptake of renewable energy.”
Full report here: Tribal Utility-Scale Solar Initiatives Advance Across Southwest U.S.
Karl Cates [email protected] 917 439 8225
Vivienne Heston [email protected] 914 439 8921
The Institute for Energy Economics and Financial Analysis (IEEFA) conducts global research and analyses on financial and economic issues related to energy and the environment. The Institute’s mission is to accelerate the transition to a diverse, sustainable and profitable energy economy.