The US had a total of 76 GW of solar capacity by the end of 2019. Although the solar energy growth targets for 2020 were slashed, due to COVID 19 outbreak, the solar industry has still managed to bring forward good news for the US. Recent research by Lawrence Berkeley National Laboratory indicated that utility-scale solar plants are not just getting cheaper to run (operational expenditure $35 per kilowatt/year in 2007 to $17/kW-year in 2019) but are also offering longer lifespan (now averages 32.5 years, up from 21.5 years in 2007).
The Upward Trajectory
It is a fact that without clear and considerable improvements in project life and operational expenditure, the Levelized Cost of Energy for projects built in 2019 would have increased by 43% to an average of $73/MWh. However, this quick rise in operational excellence and life span is not really miraculous, given the worldwide research on solar panel efficiency (NREL published paper to enhance 32% efficiency of panels) and longevity technologies backed by global support (solar 11% share in total energy in 2017 in the US to 48% in 2050).
How Can This Enhanced Life Span Help?
Longer lifespan will certainly offer more years of revenue to the owners, thus allowing them a higher return on investment, which are upfront capital costs and any necessary component replacements or refurbishments. This facility will drive down the levelized cost of energy. There is also the advantage of selling power to the competitive markets beyond the term of the power purchase agreement, which is generally a fixed priced. The expectations for profitable ‘merchant tail’ opens up the opportunity for aggressive pricing for initial power sales agreements.
Besides, O&M, which is the largest single piece of utility-scale project operational expenditure, is now available at rock-bottom prices, thus making solar plants high payment and low maintenance assets for a longer lifetime than previously calculated.
Solar Has a Bright Future
There has been a considerable reduction in solar growth in the US in 2020 solar has a bright future. Total installed PV capacity in the country is expected to rise with grid interconnection queues from California to Texas to the Mid Atlantic. With new projects coming up and existing ones turning towards completion, the US Bureau of Labor Statistics estimates that the solar PV industry could very well become one of the fastest-growing job sectors, offering a median annual wage of over $42,000. With continuous growth in leading states in the US, including California; Texas; Florida; Nevada; and North Carolina, the future for solar remains bright. It is apparent that this longer lifespan announcement will only add to solar adoption growth and speed up green energy transition in the country.