Making Renewable Energy Affordable
For many organizations, electricity costs are one of the largest expenses incurred, but can renewable energy bring down the cost of energy in a grid environment with low-cost natural gas?
Yes! Large scale renewable energy can be equal to or a lower cost relative to traditional grid power. This cost-competitiveness can be largely attributed to:
1) Technology cost declines
2) Investment (and other) tax credits
3) Competitive sourcing
Solar and wind costs are falling. By 2027,Â Bloomberg New Energy FinanceÂ predicts that constructing new solar and wind facilities will cost less than maintaining existing gas and coal structures.
Yes, you read that correctly. Renewable energy is becoming so affordable it will be better to build brand new than keep what’s old.
The Investment Tax Credit (ITC) program has been critical in putting solar energy on local grids,Â particularly as solar prices continue to fall and solar efficiency rises.
According to the Solar Energy Industries Association,Â the tax credit has helped annual solar installation grow by more than 1,600 percent since the ITC was implemented in 2006.
Thatâ€™s a compound annual growth rate of 76 percent! These costs will directly or indirectly flow to the customer (your organization).
Executing large-scale renewable energy projects and entering into long term contracts for renewable energy projects (Purchase Power Agreements) is new to most organizations and poses many unknowns.
State and federal tax credits, the rapidly decreasing cost of solar and wind technologies, and competitive sourcing can directly or indirectly reduce the cost of bringing green energy into your workspace.
With the declining cost of renewable energy technologies and the Investment Tax Credit set to expire in 2022, it’s time to start thinking renewables.