What's the cheapest way to make power? It's shining down on you

Solar power is clean and now it's cheap.
ALDEN WILLIAMS/FAIRFAX NZ

Solar power is clean and now it's cheap.

Thanks in large part to economies of scale, solar is fast becoming the cheapest way to generate power.

Solar energy is now even slightly cheaper than wind energy.

Data from Bloomberg New Energy Finance (BNEF) shows the cost of solar in 58 lower-income countries has fallen to about a third of what it cost in 2010.

Tesla boss Elon Musk says his solar roofs will be cheaper than a traditional roof, even before taking into account the ...
BOBBY YIP/REUTERS

Tesla boss Elon Musk says his solar roofs will be cheaper than a traditional roof, even before taking into account the savings on power costs.

In August, an auction for supplying electricity to Chile achieved the record low price of US$29.10 (NZ$41.83) per megawatt-hour – about half the price coal was going for at the same auction, The Independent reported.

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BNEF chairman Michael Liebreich said in a note to clients: "Renewables are robustly entering the era of undercutting [fossil fuel prices]."

Renewable energy is cheap in developing countries that are looking to add more electricity to the national grid.

"Renewable energy will beat any other technology in most of the world without subsidies," Liebreich said.

However, in rich nations where new renewable energy generators compete with existing fossil fuel power stations, the cost of carbon-free electricity can be higher, according to The Independent

The plunge in the price of solar had partly been produced by the economies of scale.

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BNEF head of US policy analysis Ethan Zindler said: "Solar investment has gone from nothing – literally nothing – like five years ago to quite a lot.

"A huge part of this story is China, which has been rapidly deploying solar."

Beijing has also been helping other countries to pay for solar projects.

Solar has also helped power remote islands such as American Samoa.

Once reliant on diesel imports, the island of Ta'u is now powered by 5000 solar panels and 60 Tesla batteries.

Last month, Tesla's Elon Musk announced the company's solar roofs will cost less than traditional roofs, even before the savings on power.

However, New Zealand power company Unison Energy imposes a "solar tax" on members of the public who generate and use solar energy.

 - Stuff

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