Costs of Renewables Drop as California Nears 2020 Renewable Energy Goal

The latest California Energy Commission report on renewable energy estimates that the state is on track to meeting its goal of sourcing electrical energy from renewables and its target for installing renewable distributed generation.

That report, an update to the Energy Commission’s tracking progress report on renewable energy, estimates that 27 percent of electricity retail sales in California came from renewable energy in 2016.

The progress report is a biannual snap shot of California’s progress in meeting its Renewables Portfolio Standard (RPS) goals as well as growth of renewable energy in the state. The RPS goals include the state deriving 33 percent of its electricity from renewable sources, such as solar, wind, biomass, and small hydro or geothermal, by 2020, and 50 percent by 2030.

The report also tracks progress in reaching a goal of installing 12,000 megawatts (MW) of renewable distributed generation in California by 2020. Distributed generation projects described in the report are defined as 20 MW or smaller, including self-generation and projects used close to where the energy is consumed.

As of October 31, 2016, almost 9,400 MW of distributed generation capacity was operating or installed in California, with an additional 900 MW pending, according to the report.

Renewable Distributed Generation in California 
(20 MW or Smaller, Includes Self-Generation)

The data include almost 5,100 MW of solar self-generation capacity, exceeding the state’s goal of installing 3,000 MW of solar energy residential and commercial sites in the state by 2017.

Data from the U.S Department of Energy (DOE) and Lawrence Berkeley National Laboratory (LBNL) shows that costs for renewable energy is dropping nationwide, which is spurring market growth for renewables.

Nationally, the median installed price for utility-scale PV has fallen steadily - by nearly 60 percent since 2007, according to data from the DOE SunShot program and LBNL.

The installed cost of wind has also decreased over time. Research from LBNL found that the average capacity-weighted installed wind project cost roughly $1,690 per kilowatt – a 27 percent drop when compared to the costs in 2009 and 2010, the report said.

Onshore wind power purchase agreement prices also declined, from a high of $70 per megawatt hour (MWh) to an average of about $20 per MWh between 2009 and 2015, according to LBNL research.

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California Energy Commission

The California Energy Commission is the state's primary energy policy and planning agency created by the Legislature in 1974.
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