When it's cheaper to build new solar than to run your old power plant, things change fast.
We've talked a lot about the arrival of unsubsidized wind and solar. But whether or not a particular installation makes financial sense on its own is only part of the story.
The next big milestone will be when unsubsidized wind and solar undercuts the cost of existing fossil fuels. And that milestone may be coming sooner than any of us might have thought.The fabulous David Roberts over at Vox reports that even utility CEOs are now predicting that it will be cheaper to build new wind and solar than to keep running the old coal and nuclear plants that have already been built. Jim Robo, CEO of the gigantic NextEra Energy (subsidiaries include Florida Power & Light), made this claim on a Q4 earnings call on Friday, apparently. And as Roberts notes, the fact that this statement was made to investors—to whom Robo has legal obligations in terms of transparency and accurate reporting—is not insignificant.
There are, I think, several important points to consider if this prediction holds out:
1) It's one more sign that anti-renewables forces and climate delayers can only do so much damage.
2) We're reaching tipping points at which investors will invest simply because it makes sense, not because it's the "right thing to do" or a good PR move.
3) This point I will leave for Roberts to make via his twitter feed:
5. Support was never intended to be permanent. The idea was to stand the industry up, get it benefiting from economies of scale, get costs down, & then phase out supports & let it stand on its own. According to NextEra & others, that process is almost complete. RE is ready.— David Roberts (@drvox) January 29, 2018
Now, as commenters over on my previous post about the inevitability of renewables pointed out, our work is not yet done. Even if wind and solar may soon be able to compete free of subsidies, the playing field is not level until fossil fuels pay for the damage they actually cause.
But making them pay that cost will be infinitely more politically feasible once lower-cost wind and solar are able to take up the slack, ensuring that power prices don't rise, even as we transition away from dirty fossil fuels.