An analysis of First Solar's system in the Nevada desert argues that solar costs less than coal. Renewables rejoice.
First Solar has made it to grid parity, according to at least one analyst.
A 12.6-megawatt system installed by First Solar (NSDQ: FSLR) for Sempra Generation showed that the system can produce electricity at below the price of conventional power in the United States, said Mark Bachman, an equity analyst at Pacific Crest, in a research note Tuesday.
The solar power plant, located in the Nevada desert, costs $0.075 per kilowatt hour to install without any subsidies, Bachman wrote. Conventional power fed into the grid costs $0.09 per kilowatt hour.
"In our view, the industry leaders will be those companies that can deliver electricity at or below grid parity pricing without the aid of subsidies while also delivering superior return to shareholders," Bachman said. "Currently, only First Solar can claim these achievements, in our view."
Bachman's cost calculations, of course, are impacted by a number of factors and others will likely come to different conclusions. Part of the calculation relies on what others are achieving in other locations with different kinds of panels. Nonetheless, it underscores the progress the industry is making toward the important milestone.
And First Solar isn't the only narrowing in on it. Yesterday, Cypress Semiconductor CEO T.J. Rodgers told a group of reporters that power from crystalline silicon solar panels will be cheaper than coal power by 2012 when transmissions lines, utility bureaucracy and other factors are added in....MORE