Is it cheaper to build commercial-scale solar or buy from the grid?

The cost of building a commercial scale solar project has dropped dramatically in the last decade. Based on the average cost to build a commercial-scale project compared to the average price paid by commercial utility customers, it is already cheaper to build a solar project. The cost of self-generation is forecast to continue going down, widening the gap with the cost of electricity from the grid.

The forecast component is built on NREL’s 2020 ATB models (links in spreadsheet), with the following assumptions:

  • 300KW system
  • 15.2% capacity factor (Kansas City)
  • 20-year financing (NREL’s default was 30 years)
  • no ITC in prior years or in forecasts (NREL’s R&D model)

Download the full spreadsheet here by clicking on the bottom right of the embedded Excel spreadsheet.

This analysis is used in: Energy Fact; Building a commercial-scale solar project is cheaper than buying from the grid

Additional data

  • EIA commercial electricity 2019-2050:
    • Browser row: End-use prices > (2019 cents per kilowatt hour) > Commercial (2019 $/kWh)
  • Commercial electricity 2010-2018: EIA
  • Commercial solar LCOE 2010-2018 NREL:
  • Commercial solar LCOE 2019-2060 NREL: ATB forecasts

Code: m161 FinComSolGrid math xbMath