The U.S. is on track to achieve four major innovation breakthroughs thanks to American Recovery and Reinvestment Act (ARRA) investments, according to a new analysis from the office of Vice President Joe Biden. One of the expected breakthroughs is halving the cost of solar power in half by 2015, putting solar electricity prices on par with the cost of retail electricity from the grid.
The cost of power from rooftop solar panels will drop from $0.21/kWh in 2009 to $0.10/kWh in 2015, which is equivalent to typical household electricity rates, the report says. The cost of power from utility-scale solar projects will drop from $0.13/kWh today to $0.06/kWh in 2015, which is equivalent to the cost of wholesale utility power. Furthermore, the cost of rooftop solar power could drop to as low as $0.06/kWh by 2030.
Thus far, the Section 1603 Payments In Lieu Of Tax Credits program (also known as the Treasury cash-grant program) has supported more than 200 MW of solar projects that are currently delivering power to consumers. These projects include the 25 MW DeSoto Solar Park in Pensacola, Fla.
In addition, 48C Manufacturing Tax Credits (also known as the DOE loan-guarantee program) have aided numerous solar manufacturers, including First Solar and Sunpower. Both companies had received earlier DOE research and development grants to help develop the technologies that are now being brought to commercial scale.
These solar deployments and factories create high-quality jobs today and promise to help re-establish U.S. leadership, reversing years of declining U.S. market share in global solar production, according to the report. In fact, domestic manufacturing capacity for solar photovoltaic modules is forecast to grow from less than 1 GW per year in 2008 to nearly 4 GW per year in 2012.
In addition, the DOE's solar PV incubator program is continuing to support competition among crystalline silicon, thin-film materials – such as cadmium telluride and copper indium gallium diselenide – and concentrating PV. AltaDevices, SolarJunction, Semprius and other firms are applying novel technologies to increase the efficiency and lower the cost of solar, Biden's office reports. Pre-incubator and incubator programs are supporting breakthroughs in nanomaterials and organic materials that could drive down costs even further.
In total, more $23 billion of ARRA investments support renewable energy – including investments that directly contribute to the doubling U.S. renewable energy generation capacity (from 28.8 GW to 57.6 GW) by 2012. This means installing as much renewable energy generating capacity in the next three years as the U.S. had in the previous 30 years.
The full ARRA report can be viewed here.