With so few utility-scale solar-plus-storage projects actually built, we don’t have much data on how their economics work.
Now those companies considering it — a group that includes all major solar developers — have a bit more insight, thanks to Paul Denholm and his colleagues at the National Renewable Energy Laboratory.
Their new analysis models the benefit-cost ratio of several solar and storage configurations under present circumstances and projected cases in 2020.
In today’s market, under the assumptions of the model, standalone PV beats any of the hybrid combinations. Fast-forward to 2020 with an assumed 15 percent solar penetration, and DC-coupled PV-plus-storage with the federal Investment Tax Credit takes the lead.
In a 2020 scenario with 24 percent solar penetration, standalone PV plummets in value and all types of solar-plus-storage take the lead.
The real-world economics will change from place to place, but the trend here is clear: As the share of variable solar generation increases, so will the payoff for siting storage in the same place.
That evidence suggests the data is catching up to the aspirations of the storage industry, which Denholm has been tracking for the last 15 years.
“The hype might actually be real,” he said. “If these somewhat conservative projections do come true, then yes, by 2020 solar-plus-storage will be a cost-competitive source of dispatchable energy.”
Not just cost
It’s easy enough to calculate levelized cost of energy for a solar-plus-storage system, and it will always be more expensive than standalone solar. But that metric fails to capture the additional value that can be gained by adding storage.
If the developer needs to deliver power for the evening peak, a storage-assisted PV plant will be significantly more valuable than the alternative.
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