There has been a lot of chatter recently, both in Colorado and across the nation, about the growing need to develop a new energy infrastructure to replace the country’s aging stock of coal-fired power plants. With solar panel prices falling by 30 percent last year and continuing to fall this year, renewables are well on their way to becoming the cheapest solution to new power generation. In fact, according to the U.S. Energy Information Agency, both in 2015 and 2016, wind and solar power accounted for about two-thirds of all newly added electricity generation capacity nationwide.
In line with the growing trend, in August of 2017, Colorado’s electric utility company Xcel Energy proposed to shut down two of its coal plants and replace them with renewable energy and natural gas facilities as part of its Clean Energy Plan.
Since then, the company asked for bids from independent energy developers that could help bring its renewable energy projects to life. Well, the bids are now in, and the results surprised everyone.
According to Xcel Energy’s recent report, it received 430 proposals, 350 of which were for renewable energy projects. Even more surprising, the median price for the 75 solar project bids came in at $29.50 per megawatt-hour, while the median bid price for the 42 wind projects was $18.10 per megawatt-hour. Both are the lowest prices ever quoted for such projects in the United States. According to the Clean Energy Plan backers, at these rates, Xcel’s Colorado customers would save more than $175 million.
“As renewable energy sources such as solar and wind become more popular, their non-consistent power output is also bringing new challenges,” notes Donald Smith, Program Director at Ecotech Institute. “The cyclic nature of their power output due to the Sun’s position throughout the day and the effects of changing weather can make it difficult to maintain a stable power grid with consistent reliable power. This means that either electricity storage systems or auxiliary power plants utilizing traditional fuel sources are needed to make up for any deficiencies in power production.”
However, the good news is that even when calculated with the addition of energy storage to the generation capacities, the proposed prices for Xcel’s Clean Energy Plan only go up slightly — to $36 and $21 per megawatt-hour for solar and wind, respectively.
All of this is definitely good news not only for Xcel and its customers, but also for more than 62,000 Coloradans working in the clean energy sector. According to the new “Clean Jobs Colorado” report by national nonpartisan business group Environmental Entrepreneurs, companies are now expanding their clean energy workforce at a brisk pace.
Over the next year, the state’s clean energy employers are projected to hire nearly 1,500 professionals – a two percent growth rate, the report says. This will add to more than 14,000 people already employed by Colorado’s renewable energy sector, including nearly 7,000 people working in the solar industry and 6,500 in the wind industry.
“It’s great to hear the news that wind and solar continue to not only grow at competitive prices, but also break records along the way,” Smith adds. “As someone who helps prepare students for careers in the energy industry my colleagues and I at Ecotech Institute are excited to see the tremendous opportunities that unfold as our economy moves toward more advanced energy technologies that are also better for the environment.”
The Colorado Public Utilities Commission (PUC) is slated to vote on the Clean Energy Plan around March 21.