Cost Gap for Western Renewables Could Narrow by 2025: NREL

September 04, 2013

A new Energy Department study conducted by the National Renewable Energy Laboratory (NREL) indicates that by 2025, wind and solar power electricity generation could become cost-competitive without federal subsidies, if new renewable energy development occurs in the most productive locations. The report, Beyond Renewable Portfolio Standards: An Assessment of Regional Supply and Demand Conditions Affecting the Future of Renewable Energy in the West, compares the cost of renewable electricity generation (without federal subsidy) from the West’s most productive renewable energy resource areas with the cost of energy from a new natural gas-fired generator built near the customers it serves. The study includes any needed transmission and integration costs.

The study draws on an earlier analysis the lab conducted for the Western Governors’ Association to identify areas where renewable resources are the strongest, most consistent, and most concentrated, and where development would avoid protected areas and minimize the overall impact on wildlife habitat.

Among the study’s findings: Wyoming and New Mexico could be areas of robust competition among wind projects aiming to serve California and the Southwest. Both states are likely to have large amounts of untapped wind potential after 2025. Wyoming, along with Montana, could also emerge as an attractive area for wind developers competing to meet demand in the Pacific Northwest. Wyoming wind power could also be a low-cost option for customers in Utah.

Arizona, California, and Nevada are likely to have surpluses of prime-quality solar resources, which also has its own diverse portfolio of in-state resources. And new geothermal development could trend toward Idaho by 2025 because much of Nevada’s resources have already been developed. See the NREL press release and the full report PDF.