On 28 December 2017, Xcel Energy filed their Electric Resource Plan (ERP) for Colorado. Over 350 proposals for renewable energy were received by Xcel Energy and highlight the incredible cost reductions in renewable energy with storage.
According to the filing, the median bid price for wind plus storage was $21/MWh and for solar plus storage was $36/MWh. Around 26 GW of solar and wind with storage were bid. A summary of the bids is tabled below.
Source: Xcel Energy (2017)
Details on the bids are sparse. Crucially, the amount of storage is currently unknown. The combination of renewables plus storage bids are $3-$7/MWh higher than standalone wind and solar bids, suggesting a limited amount of storage. The capacity, if accepted, will also be online by 2023. However, as far as we know, these are the lowest renewables plus storage bids in the US to date. The previously lowest known solar plus storage bid price was $45/MWh in Arizona in May 2017.
These changes highlight the dramatic declines in storage costs and reveal just how uncompetitive coal has become. In our recent report, no country for coal gen, we modelled the operating cost of every coal-fired unit in the US. The figure below shows the operating cost of coal units in Colorado. Based on our modelling, the median bid for wind plus storage is lower than the operating cost of all coal plants currently in Colorado, while the median solar plus storage bid is lower than 74% of operating coal capacity.
Operating cost of coal in Colorado versus median Xcel ERP renewables and storage bids
This news comes as research suggests coal burn in the US declined 2% (y-o-y) in 2017. Despite the intentions of the Trump Administration, it seems coal is not coming back and will likely remain at the mercy of cheap gas and renewables.