Solar power now cheaper than natural gas for utility companies

According to experts in the solar industry, the U.S. expects to see the construction of 13 gigawatts worth of new utility-scale solar PV projects in the next two years. This number is impressive on its own, but it becomes even more striking when compared to the state of solar in this country as recently as a year ago. These new projects will provide a power supply equivalent to the total amount of solar power that was available across all sectors at the end of 2013.

So what's behind this explosion in the popularity of solar among utility companies? Apparently, the price of solar power has decreased dramatically for these companies over the past few years. Solar energy currently costs a utility company about 4.5 to 7.5 cents per kilowatt hour. In 2008, the price of solar energy was more than double this amount on average.

This impressive dip in prices is enough to put solar on an equal footing with natural gas when it comes to cost competitiveness, meaning that the old excuse about clean energy being too expensive to be practical is effectively no longer valid. An executive at Xcel Energy explained the company's shift toward solar power this way: "This is the first time that we've seen, purely on a price basis, that the solar projects made the cut — without considering carbon costs or the need to comply with a renewable energy standard."

The drop in prices is due largely to the Solar Investment Tax Credit, which reduces taxes for companies that purchase solar energy and has allowed the sector to grow exponentially since its inception in 2006. Solar power advocates are currently urging Congress to extend the provision; otherwise it will end in 2016.

To learn about green energy options for your own home, contact Alban Inspections for an energy audit today.