Sometimes, it’s not so bad to be proved wrong. Late last month, David Keith, a Harvard professor of applied physics and public policy, published a piece in Greentech Media, revisiting his 2008-2011 projections on the cost of solar modules, in which he was skeptical about predictions of falling prices. But solar has gotten much cheaper much faster than he thought. In 2008 he predicted only even odds of lowering the price of a solar power system to $0.30 per watt in 2030. In reality, the prices have already lowered to $0.50 per watt, and for large installations in the best locations, the cost of electricity from solar PV, without subsidy, is now under $40 per MW-hour, and could be at $20 by 2020. “Compared to other new sources of supply, this would be the cheapest electricity on the planet,” wrote Keith. 

We here at Advanced Energy Perspectives are no strangers to being wrong, but we’ve also long known that the rapid innovation in technologies and business models is driving down the cost of advanced energy, and renewables in particular, making it more desirable for customers of all kinds. This week we saw several examples of this trend.

First, we’ll visit Hawaii (only figuratively, I’m afraid), which is sending another “postcard from the future.” Lawmakers in Hawaii have allocated $1.2 million in the state budget to study alternative utility and regulatory models, including “cooperative, municipal, and independent distribution system operators.” This isn’t the first time, either. As Utility Dive reports, earlier this year, the County of Maui commissioned a report on alternative utility models that found a nonprofit grid operator similar to an Independent System Operator is the “best bet” to take over from Maui Electric Co., which is a subsidiary of Hawaiian Electric Industries (HEI).

This is all taking place in the context of a major utility merger in the state: NextEra Energy has been trying to buy HEI for $4.3 billion since December 2014. The deal is still pending regulatory approval, and has a deadline of June 3, though the deadline may be pushed back.

Back in the lower 48, the Wall Street Journal reports that utilities are investing heavily in renewable energy and selling the electricity to other utilities. WSJ points to the energy arm of Warren Buffet’s Berkshire Hathaway, Duke Energy, and Southern Co. as examples of utilities that are investing more heavily in wind and solar farms than ever before. This growth in investment is spurred by renewable energy mandates in more half the states and anticipated regulations from the federal government, especially EPA’s Clean Power Plan (CPP).

For more information on the renewable energy standards for each state, check out PowerPortal. 

As we reported in early April, many utilities are getting ahead of the curve, planning for the CPP despite the stay issued by the Supreme Court. “Utilities don’t have the luxury of waiting on the federal courts for absolute certainty,” said David Mengebier, Senior Vice President of Governmental & Public Affairs at Consumers Energy in Michigan, one of the utilities planning for the CPP.

Moreover, investments in wind and solar, especially when coupled with long-term PPAs, are sound investments. “It’s a very reliable, sustainable, predictable business transaction,” said Southern Chief Executive Tom Fanning in an interview with the Wall Street Journal.

Plus, a new product on offer from AEE member General Electric makes managing renewable generation even easier. GE’s fast-ramping gas turbine, the GE Jenbacher J920 FleXtra gas engine, is now being used at Sky Global Power One in Texas. The GE engine is a highly efficient gas engine with fast response times that can operate in concert with a large renewable base and help out with peak loads as necessary. 

Wrapping up the week with AEE member companies in the news, it was announced that Opower would be acquired by Oracle, which, as Stephen Lacey writes in Greentech Media, could be a mutually beneficial arrangement. Oracle can help Opower develop into an enterprise software-as-a-service provider for utilities, Lacey writes, and Opower’s customer care offerings can give Oracle new product advantages.

Also this week, E&E News (subscription required) quoted AEE member FirstFuel in an article on a new DOE report on ways to make efficiency improvements in commercial buildings. DOE’s new road map examines ways commercial real estate could cut energy use, which accounts for about 20% of total energy used in the U.S.

“The DOE’s attention to energy efficiency in commercial properties is insightful and necessary. Some of the challenges and opportunities recognized in this report are consistent with the experience FirstFuel has had with our utility clients and their business customers, and the research really speaks to the size of the opportunity and methods for better engaging tenants,” said Indran Ratnathicam, vice president of marketing and strategy at FirstFuel Software.

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