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Leon Kaye headshot

DOE SunShot Initiative Reaches $1 Per Watt Goal Three Years Early

By Leon Kaye

Lost in all the news over the silencing of scientists and the rogue Twitter accounts emerging as one form of protest against incoming President Donald Trump is a success story that can be traced back to the previous administration.

The cost of utility-scale solar power has plunged to the Obama administration's $1 per watt goal -- and three years early at that.

Now, a 2011 initiative that was once seen as more aspirational than realistic has the potential to transform the nation’s energy portfolio, Eric Wesoff of Green Tech Media inferred this week.

Many publications and financial analysts predicted the $1-a-watt magic metric was approaching “soon.” That “soon,” however, is today.

According to the Department of Energy, the SunShot initiative is largely the reason for the growth of solar across the United States. Five years ago, solar power contributed less than 0.10 percent, or 1.2 gigawatts, to the country’s electricity supply.

Five years later, solar still comprises a small part of the nation’s energy portfolio. But its growth has been exponential: More than 30 gigawatts, or over 1 percent of the nation’s power generation, now comes from solar.

Back in 2011, utility solar in America cost a little over $4 per watt on average. In February of that year, former Energy Secretary Steven Chu announced the SunShot initiative, which aimed to reduce the total costs of photovoltaic systems by 75 percent, to $1 per watt (about 6 cents per kilowatt hour) by 2020.

The program had four pillars:

  • Improve the efficiency of solar cells
  • Optimize electronics that would improve solar systems’ performance
  • Boost the efficiency of solar manufacturing processes
  • Streamline the installation, design and permitting processes nationwide
It also included grants and loans to incentivize solar companies to improve the efficiency of their products and supply chains.

Critics derided the program as a farce, and often pointed to the Solyndra bankruptcy as evidence of a failed program. Meanwhile, China’s investments in solar technology led to a collapse in prices for solar panels and other equipment, often at the expense of American and German companies. Indeed, it was those cheap prices that has contributed to the solar boom in the U.S. and worldwide.

But the DOE’s efforts cannot be overlooked, despite some of the hurdles along the way. In hindsight, the Solyndra fiasco was more of a hiccup than a symptom of endemic failure in U.S. energy policy.

As Bloomberg noted in November, the federal energy loan program responsible for Solyndra (which started during the George W. Bush administration) ended up being a profitable venture for the U.S. government -- generating at least $1.65 billion in interest payments to date.

While the future of energy policy is uncertain, for now the Department of Energy keeps pressing ahead.

Last last year, it announced the SunShot initiative set new sights on solar affordability: Aiming to halve the average cost of utility-scale solar power to 3 cents per kilowatt-hour by 2030.

Under this new program, commercial photovoltaic power has a target of 4 cents per kWh; residential solar would decline to 5 cents per kWh. Judging by the program’s track record, such a target is hardly outlandish.

And with or without the Trump administration’s support, or specifically buy-in from new Energy Secretary Rick Perry, the private sector will continue to boost solar power’s efficiency while further lowering its price.

As Green Tech Media’s report points out, there are still costs that can be saved by improvements in labor, engineering, procurement and construction. Furthermore, as MIT Technology Review reminds us, that watt-per-hour metric is what engineering firms would bid to build a solar installation for a utility – but there are other costs, such as software, transmission lines, and the fact that energy storage technology is not yet at the point to let these systems deliver power 24/17.

But Chu’s initiative provided the much-needed spark: The goal, after all, was to make solar cost-effective enough so that it no longer needed subsidies to scale.

So Chu, who is now at Stanford University, can look back and know that he was probably the most successful, and consequential, energy secretary since the department was established in the 1970s.

For decades the DOE was an afterthought, as it was cobbled together by Jimmy Carter as a means to consolidate various energy agencies in a reaction to that decade’s volatile oil prices. Now, the department is a catalyst of innovation and economic development -- and a revenue generator.

While the current regime is hell-bent on removing any of Barack Obama’s fingerprints from the federal government, the new administration would be wise to look at the results and keep their hands off this program.

Image credit: U.S. Navy/Flickr

Leon Kaye headshot

Leon Kaye has written for 3p since 2010 and become executive editor in 2018. His previous work includes writing for the Guardian as well as other online and print publications. In addition, he's worked in sales executive roles within technology and financial research companies, as well as for a public relations firm, for which he consulted with one of the globe’s leading sustainability initiatives. Currently living in Central California, he’s traveled to 70-plus countries and has lived and worked in South Korea, the United Arab Emirates and Uruguay.

Leon’s an alum of Fresno State, the University of Maryland, Baltimore County and the University of Southern California's Marshall Business School. He enjoys traveling abroad as well as exploring California’s Central Coast and the Sierra Nevadas.

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