Solar power is cheaper than nuclear, report says

A Durham advocacy group issued a report this morning that contends that electricty from solar power already is cheaper than electricity generated by new nuclear  and will be cheaper still in the future.

The report states that solar developers already are offering to sell utilities electricity for 14 cents per kilowatt hour or less, yet Duke Energy and Progress Energy are moving forward with plans for nuclear plants that would generate electricity at a higher cost: 14 cents to 18 cents per kilowatt hour.

"The bottom line is: Solar power is now cheaper than new nuclear power, particularly in North Carolina," Jim Warren, executive director of the N.C. Waste Awareness and Reduction Network, said during a conference call. Today's report is the organization's latest salvo in its ongoing campaign against nuclear and coal-fired plants.

The report was authored by John Blackburn, a former chairman of Duke University's economics department as well as the university's former chancellor. He also has written two books on renewable energy.

Blackburn said that the cost of generating solar energy has fallen by half over the last dozen years and is projected to fall another 50 percent in the next 10 years. At the same time, he said, the projected cost of generating electricity from new nuclear plants is rising.

At a N.C. Utilities Commission hearing in March, Blackburn testified that the state could shut down all of its coal-burning power plants by 2029 and replace them with a combination of solar energy, wind power and other renewable energy sources. Duke Energy, in a filing with the commission, called Blackburn's estimates "so flawed as to be completely unreliable."

Progress Energy spokesman Mike Hughes said that the utility doesn't dispute that solar costs are declining, but said that comparing the cost to nuclear is comparing apples to oranges.

"One produces electricity a small part of the time and the other continuously," he said in an e-mail message.

"Importantly, actual experience in North Carolina to date indicates that solar...plants are producing electricity about 16 percent of the time," he noted. "We expect that number to grow, but our customers do not only use electricity when the sun shines, so we have to invest in many technologies, including solar, biofuels and new nuclear energy."

Duke Energy spokesman Jason Walls said that the Charlotte-based utililty is "making significant investments in solar energy. But any assertion that solar energy can replace nuclear energy is just misleading."

Solar energy currently enjoys tax benefits that lowers the cost to customers, WARN's report notes. Still, it contends that the cost of producing solar electricity is declining and is projected to be cost-competitive without subsidies during this decade.

In addition, the report states, nuclear plants also benefit from subsidies.

"Right now the biggest barriers to solar energy are the electric utilities, who expect to make substantially greater profits from the proposed nuclear plants," said John Runkle, WARN's legal counsel.

According to the report, "solar installers complain that Duke Energy has turned down a host of competitively priced proposals [to sell it electricity], and that Progress Energy generally considers only small-scale projects."  

Getting financing for the installation of a large solar project requires showing the lender that the developer has a  contract to sell power to a utility, Blackburn said.

N.C. WARN is urging Gov. Bev Perdue to look at ways other state governments are helping homeowners adopt solar energy. The up-front cost of installing solar equipment, after deducting federal and state tax credits, is $8,000 to $20,000, said Blackburn.

A sobering thought for consumers in the report is that both new solar power and new nuclear power will cost more than the prevailing cost of generating electricity.

"In any event, electricity rates in North Carolina will go up," said Backburn. "Our contention is it will go up more if new nuclear plants are built."