Cost of solar power plants down 50%

by Lenie LecturaJune 11, 2016

from Business Mirror

THE cost of harnessing power from the sun is fast declining, said Solar Philippines, noting that cost has gone down 50 percent from the previous eed-in-tariff (FiT) rate of P9.68 per kilowatt-hour (kWh).

Solar Philippines President Leandro L. Leviste said solar-power costs have fallen mainly on account of the decrease in the cost of solar panels, low interest rates, high levels of sunlight and advances in technology, among others.

“Costs have gone down and efficiency gone up, allowing new solar-power plants to sell at half the cost of the original tariff rate,” Leviste said.

Many perceive solar power as expensive, and will take decades more to be competitive. Yet, last month, Leviste said, the world’s lowest-priced solar power was bid in Dubai at P1.345 per kWh. Other bids resulted in P1.575 in Mexico and P1.741 in the  United States.

“We must send a strong message to everyone in the power industry that the time of low-cost solar has arrived, and the era of fossil fuel is near its end,” Leviste said.

Fossil fuel includes coal, which averages P4; gas, P6; and diesel, P8.

“The debate is over…given solar is cheaper, and we’re building projects to prove it,” Leviste said.

Solar Philippines recently announced the country’s first local solar-manufacturing plant, and plans to complete 500 megawatts (mW) of solar capacity by 2017.

“Today our solar installation at SM Mall of Asia is supplying power at 30 percent below utility rates. It’s worth noting that cost-savings are even greater for rooftop, which also saves transmission, distribution and other charges. Thousands of homes and businesses have proven that rooftop solar panels make economic sense. Our argument is that even solar farms supplying the grid can be competitive. We will showcase this in our next solar farm in Tarlac, which will be the world’s largest unsubsidized solar farm, replacing expensive gas, oil and diesel,” he said.

Solar Philippines said it would soon build a 2-gigawatt solar facility in Batangas. Once put up, the company said this would be the world’s largest solar factory.

The facility will be located in Tanauan City, Batangas. The first phase of the solar project could be operational by end of this year.

“Increasingly, solar manufacturing is moving from China to Southeast Asia, and we believe the Philippines can lead that trend. Filipinos are among the best workers in the world, and the large local solar market can add to the demand for otherwise export-only factories,” Leviste said.

Leviste added that the facility’s objectives are to lower panel costs, take control of the supply chain, and support the new administration’s agenda to bring manufacturing to the Philippines.

“This is the key step toward  lowering solar costs, enabling us to produce electricity cheaper than coal. Instead of importing expensive fuel from other countries, we will manufacture here in the Philippines. Soon enough, our country can become the Saudi Arabia of solar, a leading energy exporter, and made-in-the-Philippines panels will be used around the world,” he said.

Solar power stored in batteries, he added, can replace gas, oil and diesel, resulting in savings of almost P100 billion a year.

“Remaking our power supply will be capital-intensive and can’t be done by one company alone. There is room for all companies now planning coal to switch to solar, as well as new players to join in, bringing competition and scale to the market, further bringing prices down,” Leviste said.