Solar has Become Dazzlingly Cheap for New Plants

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Courtesy of Robin Mills @ The National:

‘I believe solar will be even more economic than fossil fuels,” said the Saudi oil minister Ali Al Naimi at a climate change conference in Paris last week.

Recent bids in Jordan confirmed last year’s results from Dubai – solar is now cheaper than gas-fired power in this region, with major implications for energy strategies.

In Manaar Energy’s 2012 report, “Sunrise in the Desert”, published in collaboration with PwC and the Middle East Solar Industry Association, we were optimistic on the future of solar power in the region and saw it as competitive with power generation from oil or from more expensive gas. Costs have halved in just three years, meaning solar can now beat all conventional generation apart from the very cheapest gas.

Bids in Jordan’s recent solar auction were just over 6 US cents per kilowatt-hour, slightly above the record 5.84 cents from Acwa Power last November for the 200- megawatt second phase of Dubai’s Mohammed bin Rashid Al Maktoum solar park near Bab Al Shams. Egypt, struggling with a gas and power crisis, is up next with a reported 6,500MW of solar deals.

Solar prices should continue to fall because of improvements in manufacturing and installation, and steady gains in efficiency. There is also the possibility of breakthroughs, such as the recently announced possibility of perovskite crystals replacing silicon, which could be cheaper and capture a broader range of the sun’s light. Continue reading