The cost of solar energy is significantly higher when compared to the energy produced by coal and hydrocarbon sources. For this article we will be using kWh as a comparison tool between different energy sources.
The most used product for energy is currently coal. A report by Credit Suisse which utilized a variety of factors from government incentives, interest rates and production costs to calculate the cost per kWh of various energy sources. This report was released around 2009.
The most used energy source in the world is coal energy, which is used by around 39% of the planet. Energy prices in recent years have been driven up by Chinese growth and demand, while the use of the energy source has dropped in the West due to concerns about it’s environmental record. It’s cost per kWh ranges from $.066 – $.046.
Natural gas is next with a global usage of around 15%. It’s cost is from $.064 – $.04. This price is based on the price of hydrocarbons which has historically been growing higher and higher each year.
Following natural gas we have nuclear power which accounts for 24% of the worlds energy needs. It’s cost ranges from $.064 – $.035. There has been a recent backlash against nuclear plants across the world due to the incident at Fukushima and it seems like some governments have listened to the concerns by calling for plans to replace their older units.
Wind power is one of the cheapest renewable resources with a cost of $.061 - $.029 per kWh. But it suffers many draw backs just as noise, inefficiency problems, unpredictability of wind and mechanical issues.
Geothermal plants can produce remarkably cheaper energy costs from $.30 to $.022 and their prices have gone down in recent years. But it’s low figure is due to the many incentives that could be attained by creating a new geothermal plant. It doesn’t mean that they would be though, which would drive up the price considerably to that $.3/kWh range.
Hydropower runs from $.11 to $.051. Cheap and renewable it’s the supply for 20% of the worlds energy. Some problems but the best renewable energy that we’re tapping currently.
Now on to Solar power. There were three types of solar power listed in the report:
- Solar PV (Crystalline) $.20 – $.12
- Solar PV (Thin Film) $.18 – $.11
- Solar Thermal $.126 – $.069
While those numbers don’t seem too expensive, compared to the cheapest power sources they can be up to 5 times more expensive. They are also costly to replace and manufacture. But there are some very large solar plant projects in the works. The largest solar thermal project is in the United States and produces over 350 MW at peak energy production. Another hindrance to the decrease of solar panel costs is the lack of major manufacturing of the pv cells. If there was enough demand we could see prices drop by multiples.
