By Christine Buurma /Jan 9, 2007
Source: Market Watch
http://www.marketwatch.com/news/story/solars-outlook-shines-hurdles-remain/story.aspx?
NEW YORK (MarketWatch) — As utilities embrace renewable energy in an effort to cut pollution and reduce their dependence on fossil fuels, some companies are turning to a source long on the sidelines of the U.S. electricity market: solar power.
Solar power has historically lagged behind other generation sources in price and competitiveness. Only 508,000 megawatt-hours of power were generated by solar facilities in 2006, according to the U.S. Energy Administration, a mere 0.5% of all renewable power produced in the U.S. that year. Industry estimates price solar power at 15 to 25 cents per kilowatt-hour, which is well above the costs of other sources. Power produced by natural gas costs about 6.1 cents/kWh in 2005 on average, while coal-fired generation cost 1.84 cents/kWH and nuclear averaged 1.7 cents/kWh, according to the Nuclear Energy Institute.
Solar industry buzz grew louder in late 2005, however, when solar project developer Stirling Energy Systems Inc. signed agreements to sell the power generated by two large-scale solar projects to two major California utilities, Edison International (EIX) subsidiary Southern California Edison and Sempra Energy (SE) subsidiary San Diego Gas & Electric. Obstacles remain to bringing solar energy costs in line with those of other sources of power generation. A lack of necessary transmission infrastructure and high up-front development costs are significant hurdles to developing solar projects on a large scale. Solar developers hope, however, that technological advances, state incentives and requirements, and growing interest from financial backers will help expand solar energy’s presence in the U.S.
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