Solar power: National lab study finds that prices have plummeted 75 percent since ’09.

Studies show some costs down nearly 75% since 2009

Solar power — both from rooftop arrays and massive photovoltaic installations — keeps getting cheaper, according to a pair of new studies from the Lawrence Berkeley National Laboratory.

And while it still costs more than electricity from power plants burning natural gas, the difference is shrinking.

Solar power bought through longterm power purchase agreements signed in 2015 averaged about $40 per megawatt hour, according to one of the reports, which focused on utility-scale solar. That’s comparable to average wholesale power prices nationwide, according to federal data, and represents a nearly 75 percent plunge since 2009.

In some areas, electricity from large-scale solar plants may already be more economical than building new natural gas plants, said lead author Mark Bolinger, a research

scientist with the lab. And if natural gas prices rise in coming years, solar power purchase agreements could become as cheap or cheaper than electricity even from older gas plants that only have to pay for fuel, operations and maintenance.

“Given projections of where gas prices will be, those solar (power purchase agreements) signed today should come into the money in a few years,” Bolinger said.

That doesn’t mean, however, that utilities will turn away from natural gas anytime soon. Gas plants can provide power at any hour. Solar plants can’t.

“Obviously, solar power and gas-fired generation are not really the same beast — one of them is dependent on the weather, one is not,” Bolinger said. “But on the other hand, one has fuel costs and the other doesn’t.”

And large-scale solar continues to rely on government mandates and incentives.

Solar projects currently enjoy a 30 percent federal tax credit that is scheduled to drop to 10 percent in 2023. If the tax credit were just 10 percent today, the price of solar power purchase agreements would probably rise by about $10 to $15 per megawatt hour, Bolinger said — a considerable jump.

Still, his report found largescale solar projects beginning to spread outside of California and the desert Southwest, to regions such as the Southeast that hadn’t seen them before.

Rooftop solar, meanwhile has seen increasing popularity nationwide — and prices have been steadily declining as a result.

The median installed cost for residential solar arrays dropped about 5 percent in 2015 to roughly $4 per watt, according to the second Berkeley Lab report. (A typical size for a rooftop solar system is 5 kilowatts, which would make an installed array about $20,000.) That’s less than half of the average price in 2009, when the cost of solar panels began a dramatic plunge. And lead author Galen Barbose noted that many residential installations are even cheaper.

Panel prices leveled off in 2012, but the total cost to homeowners installing solar has continued to fall as solar companies look to trim their “soft costs” — expenses not directly related to the equipment. In part, that’s a sign of how crowded and competitive the solar market has become, Barbose said.

In addition, many state-level financial incentives for homeowners to go solar — such as the California Solar Initiative, which gave rebates for solar installations — have ended. Rather than raise their prices in a competitive field, installers are trying to become more efficient.

“Those incentives have generally been winding down, and as they go away, that creates a strong incentive for installers to squeeze as much out of their operations as possible,” Barbose said.