USA: Geothermal Can Compete with Solar PV - Ormat Director

Opinionated: Binary Geothermal Gives PV a Run for Its Money (California Current)

By Paul Thomsen‎ (GRC Member), Executive Director, Government and Regulatory Affairs - ‎Ormat Technologies, Inc.

In 2017, for the first time, the combined energy and capacity values of geothermal energy significantly exceeded the value of solar photovoltaic resources in California.

In the first quarter of 2017, geothermal’s wholesale energy value in Southern California was $13.50/MWh greater than solar PV. At the same time, utility estimates of marginal solar PV capacity ratings for the 2018 Resource Adequacy compliance period were between nearly 0 percent and 20 percent, resulting in a capacity value difference of up to $18.50/MWh between geothermal and solar PV.

That means in California today geothermal has a combined energy and capacity value of $32/MWh higher than PV using very conservative assumptions. When you account for geothermal’s ancillary services and operational flexibility, combined values climb to more than $40/MWh higher than solar PV.  These calculations demonstrate that geothermal can compete with solar PV on a net cost basis, even as PV costs continue to decline.

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