1. Economics of Electricity Transformation
ROCKY MOUNTAIN INSTITUTE
Kevin Brehm | September 29, 2017 | Paonia, CO
Transforming global energy use to create a clean, prosperous, and secure low-carbon future.

2. Renewable Energy prices have declined dramatically
Cost of Solar Modules and Total Panels Installed
50 MW for $34/MWh
Wind PPA
2017: $0.25/w*
Analogous to Moore’s law
Solar prices drop 20% for doubling of volume shipped
2017 spot prices are now $0.25/w
Sources: The Economist; Bloomberg New Energy Finance, “Solar Spot Price Index”

3. Wind and solar are Now Cost-Effective
2017 Prices (¢/kWh)
Projected Marginal Prices through 2037 (¢/kWh)
6.3
Natural Gas
Coal
3.9
Financing
Costs
3.4
Solar
2.8
Annual
Operations
2.5
Anecdote about Eastern CO Board meeting
Solar project is Xcel Energy Titan Solar Energy Center near Deer Creek, CO. PPA price was $33.95
Wind is based in typical prices for low-cost wind ($20/MWh and below) in Eastern CO; Xcel is building 600 MW Rush creek project
NG is based on EIA fuel projections, and Lazard data on capital and operating costs
Xcel announced plans to retire plants in Comanche Coal facility and build procure 1000 MW wind and 700 MW solar (
2.0
Wind
Solar
Wind
Natural Gas
Coal
Source: EIA Annual Energy Outlook; Lazard Levelized Cost of Energy 10.0; RMI Analysis; Xcel Energy

4. Solar lends itself to distributed generation
BEHIND–THE-METER
COMMUNITY - SCALE
UTILITY - SCALE
TYPICAL SIZE
5 KW-0.5 MW
~ MW
10-100MW
ENERGY OFF-TAKER
Households
Businesses
Utility Customers (coops, munis, and IOUs)
Subscribers (Residential, Business, Municipal)
Utility Customers (Primarily IOUs)
INTERCONNECTION
Behind-the-Meter
Distribution Grid
Transmission Grid
LEVELIZED COSTS
7–12 cents/kWh
3–7 cents/kWh
2–6 cents/kWh

5. Distributed Generation Avoids transmission Charges
2018 Prices (¢/kWh)
Projected Prices Through 2037 (¢/kWh)
N.G. + Transmission
N.G.
2 MW
Solar
4.7
4.3
3.9
5 MW
Solar
2.7
Natural Gas
N.G. + Transmission
2 MW
5 MW
Source: EIA Annual Energy Outlook (2017); RMI Eastern CO RFP Results

6. Battery storage works now…
$19/kW demand charges for Tri-State
$4.5 cents for solar + storage

7. …And demand flexibility works even better!

8. Economic development implications
Low energy prices benefit all
Wholesale power
Wholesale distributed
Community-scale
Behind the meter
Energy Transformation = Wealth Creation Opportunity
Solar Factory opportunity

9. Solar Factory Opportunity
3 year Portfolio weighted price of $0.75/Wp
48 new Factory jobs
Target 60 MW/yr for 3yr minimum
Assembly Plant with 50,000 sq.ft.
Total capital Investment required of $5MM
300 mile expected delivery radius

10. Thank you!
Kevin Brehm