As California loses hydro resources to drought, large-scale solar fills in

Greentech Media

In 2013, yearly electricity generation from solar trailed every renewable energy technology in California except small hydro.

But over the course of a year, solar generation more than doubled in the state, making it the second-biggest provider of renewable electricity in 2014 behind wind.

According to new figures from the federal government, California is now getting 5 percent of its electricity from solar PV and concentrating solar power projects with a capacity greater than 1 megawatt. And those figures don’t include the hundreds of thousands of residential and small commercial systems that have blanketed the state in recent years, a category that continues to grow even after state incentives were phased down.

The doubling of solar generation in a year is significant for a few reasons.

It marks the first time the technology has surpassed geothermal and biomass, resources that have long been touted as the most reliable leaders in California’s energy mix.

More importantly for the state, the surge in solar generation is helping make up for the loss of hydropower from the ongoing drought. Hydro production fell by 46 percent in 2014 as extreme drought conditions spread across the state. According to the Energy Information Administration, solar PV and concentrating solar power made up for 83 percent of the hydropower decline.

California has long been the dominant market for utility-scale PV and concentrating solar power projects. In 2012, the state made up two-thirds of contracted projects — many of which boosted the 2014 generation totals after finally coming on-line. That included the 550-megawatt Topaz solar farm, the largest in the world, completed in San Luis Obispo County at the end of last year, and three phases of the 377-megawatt Ivanpah project.

In 2013, California saw a lull in new contracts signed for utility-scale projects, mostly because the large investor-owned power companies had reached their state renewable energy goals. But as California utilities realized they could get better deals for solar PPAs if they signed contracts before the federal Investment Tax Credit expires in 2017, they opened up new procurements for mega-projects. The state now accounts for around half of the 14.3 gigawatts of utility-scale projects under contract, according to GTM Research.

Pricing also continues its downward slide in the state. In 2014, utility-scale projects ranged from $50 to $75 per megawatt-hour. California projects fell into the $60- to $70-per-megawatt-hour “sweet spot,” explained GTM solar analyst Cory Honeyman. “That makes for very competitive pricing in the state,” he said.

With no sign of a solar slowdown in California, it’s likely the state will keep setting strong generation records in coming years.

Source: Greentech Media. Reproduced with permission.