irena's solar pv parity indicators to support policy makers
DESCRIPTION
Solar PV module prices have fallen by 70% in the last four years. The economics of solar PV is changing rapidly and policy makers, regulators, businesses and residential investors are having to re-assess these changes. Up-to-date, regularly released information about the costs and competiveness of solar PV systems has now become critical to ensuring that decision makers do not rely on data that is out of date and misleading. IRENA has developed a set of metrics that can be reported quarterly to help meet this need: The IRENA PV Parity Indicators. The IRENA PV Parity Indicators track solar PV installed costs and the levelised cost of electricity from solar PV systems and compares this to the cost of electricity to track the evolving competiveness of solar PV over time and will be released in Q3 2014 Data and analysis will be collected and reported quarterly to ensure that timely information is available freely to all decision makers. The indicators are, by necessity, generic and are not designed to identify an exact cost or the competiveness of individual systems. They will provide information on trends in cost competiveness and help identify cost differentials in different markets to inform future research areas and policy priorities. Initially, the IRENA PV Parity Indicators will look at the North American residential market for solar PV, but may be expanded to other countries and markets depending on interest.TRANSCRIPT
IRENA’s PV Parity Indicators:
Tracking Our Future
3 June 2014
Michael [email protected]
IRENA Innovation and Technology Centre
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Solar PV: The future
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A dynamic market
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Why PV Parity Indicators?
Rapidly declining solar PV module prices…..
…..and installed costs
Why PV Parity Indicators?
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• Narrow markets• Lack of data• High level of uncertainty on costs• High level of variation in costs
PV Parity Indicators: A Solution
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• Tracks quarterly competiveness• Indicators, not actual costs• Target audience are policy makers and thought
leaders• Start with North America• Can lead to more detailed analysis• Supports other IRENA activities
Methodology
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• Simple metrics• LCOE vs Effective Electricity Rate/Value• Require detailed assumptions & analysis
8Recent module price reductions make solar PV competitive
Residential PV Parity: A nuanced story
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Residential PV Parity: San Francisco
Minimum effective electricity rate
Maximum effective electricity rate
Average California electricity rate (EIA)
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Installed cost variation by city
Consistently wide variation in installed costs, why?
Plans for rollout
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Q3, 2014 California
Q4, 2014 + Other US states
Q1, 2015 + Italy
Q2, 2015 + ?
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Transparent data
Simple methodology
Timely and policy relevant information
IRENA’s PV Parity Indicators
IRENA’s PV Parity Indicators
13Tracking Our Future