Records don't last long in the cleantech business. 

Just days ago, we were reporting that the Central Arizona Project (CAP) had secured the lowest confirmed solar price in the U.S., when it approved a 20-year power-purchase agreement at $24.99 per megawatt-hour. That's setting aside an Austin Energy PPA from December that could be lower, but has more ambiguous terms.

That Arizona record is already under threat from projects that utility NV Energy selected as part of its integrated resource planning. The portfolio of 1,001 megawatts of solar capacity and 100 megawatts/400 megawatt-hours of energy storage still needs approval from Nevada’s utility regulators.

If that happens, the lowest confirmed U.S. solar price would be Sempra Renewables’ Copper Mountain Solar 5 project at $21.55 per megawatt-hour. That 250-megawatt project, though, has a 2.5 percent annual escalation as part of its 25-year contract, so the low upfront price wouldn’t last.

Instead, we can turn to 8minutenergy’s 300-megawatt Eagle Shadow Mountain Solar Farm, which clocks in at a flat rate of $23.76 per megawatt-hour throughout its 25-year PPA term.

That comfortably beats the CAP project on pricing, while delivering 10 times the capacity. It also marks a substantial improvement on the $29.50 per megawatt-hour median pricing for standalone solar PV in Xcel’s famous solicitation six months ago.

"We’ve always expected prices to drop a lot," said Colin Smith, a solar markets analyst at GTM Research. "With everything that’s happened with tariffs recently, I’m surprised to see them this low this soon."

The NV Energy contracts (bottom right) continue the trend of plummeting solar prices, which have fallen comfortably below the price of gas generation. (Image credit: GTM Research)

The record low came just months after the White House imposed import tariffs on crystalline-silicon solar cells and modules, which analysts calculated would reduce total U.S. installations by 11 percent over the next five years.

The groundbreaking pricing was achieved through sophisticated design and engineering, but also reflects how far solar equipment and installation practices have come, 8minutenergy CEO and founder Martin Hermann wrote in an email.

"Eagle Shadow Mountain is unique because it’s located in an area of great solar irradiance and with remarkable access to transmission assets," he said. "We are able to benefit from low interconnection costs, for example, by utilizing transmission assets that had previously been allocated for the Reid Gardner coal plant, ensuring that those assets are not stranded."

The low pricing has the utility excited, too.

“With these projects, the Companies lock in a substantial level of renewable energy supply at the current market’s attractive pricing for the long-term benefit of its customers, before the ITC expires,” NV Energy said in its filing.

That’s a notable achievement in a state that previously made clean energy headlines for eliminating net metering for rooftop solar customers and applying that decision retroactively to existing customers. That move, in December 2015, was overturned by legislation that Republican Gov. Brian Sandoval signed in June 2017.

Now, helped by a sunny, arid climate and plenty of open space, Nevada is establishing itself as a leading market for utility-scale solar.

“This is a great value — we’re looking at half the cost of keeping existing coal plants alive,” said Adam Browning, executive director of Vote Solar. “Getting clean energy for that price is a win-win for everybody.”

NV Energy’s awarded bids also included three solar-plus-storage plants, all located in Sierra Pacific Power Company’s service territory:

  • Dodge Flat: NextEra will build a 200-megawatt solar plant coupled with a 50-megawatt/200-megawatt-hour storage system, due online December 1, 2021.
  • Fish Springs Ranch: NextEra will build a 100-megawatt solar plant coupled with a 25-megawatt/100-megawatt-hour storage facility, due online December 1, 2021.
  • Battle Mountain Solar: Cypress Creek Renewables will build a 101-megawatt solar plant coupled with a 25-megawatt/100-megawatt-hour storage system, due online June 1, 2021.

The Nevada pricing doesn’t offer an immediate apples-to-apples comparison with recent solar-plus-storage deals.

Tucson Electric Power signed a $45 per megawatt-hour hybrid contract with NextEra in May 2017. Xcel beat that with its median solar-plus-storage bid of $36 per megawatt-hour.

NV Energy lists each hybrid project as two distinct contracts: one for megawatt-hours of solar generation and one for capacity measured in megawatt-months delivered by the co-located storage.

Xcel’s median bid for standalone storage contracts was $11,300 per megawatt-month. NV Energy’s battery contracts handily beat that, landing at $6,110, $6,200 and $7,755 per megawatt-month, respectively.

These aren’t standalone systems, however. They will enjoy cost savings on labor and interconnection by piggybacking on the larger solar construction projects, not to mention the federal Investment Tax Credit. They would best be compared to other standalone contracts for storage capacity paired with solar, but this is a new type of deal structure, which makes it hard to find direct points of comparison.

What’s clear is that NV Energy is swinging toward renewables in the face of ballot initiatives that would expand the state’s renewables target and institute competitive retail markets for electricity.

“An [integrated resource plan] is about identifying your needs and finding your solutions for the future,” Browning said. “NV Energy is making a strong affirmation that solar is the future.”

The caveat there is that if Nevada voters approve the competitive retail markets ballot measure, NV Energy has the right to pull out of its resource plan. The need for utility energy production would drop considerably if other companies could compete to supply electricity.

Nevada may be unique for just how sunny and sparsely populated it is, but similar dynamics could benefit the solar industry in Texas, Arizona and Colorado, Smith noted. That means Nevada might not hold on to the trophy for long.