Spatial and Temporal Variation in the Value of Solar Power across United States Electricity Markets

Patrick R. Brown and Francis M. O’Sullivan

July 2019

The cost of utility-scale photovoltaics (PV) has declined rapidly over the past decade. Yet increased renewable electricity generation, decreased natural gas prices, and deployment of emissions-control technology across the United States have led to concurrent changes in electricity prices and power system emissions rates, each of which influence the value of PV electricity. An ongoing assessment of the economic competitiveness of PV is therefore necessary as PV cost and value continue to evolve. Here, we use historical nodal electricity prices, capacity market prices, marginal power system emissions rates of CO2 and air pollutants, and weather data to model the value of PV electricity at over 10,000 locations across the continental United States. We identify locations with persistently high PV value and calculate break-even PV costs based on the value of offset energy, capacity, CO2 emissions, and public health costs arising from SO2, NOx , and PM2.5 emissions. Under 2017 prices and grid conditions, PV breaks even at 50% of nodes in New York and 60% of nodes in the mid-Atlantic region based on the value of energy, capacity, and public health benefits, and at 100% of nodes in Texas, the Midwest, and the mid-Atlantic under an additional 50 $/ton CO2 price.