Value of Solar

How much is the energy of the sun worth? By one estimate, the answer is 18 cents/kWh. But what does that mean? And how was that calculated?

Wisconsin is undergoing an energy transformation with historical fuel sources being increasingly replaced by more renewable energy sources. It is widely acknowledged that solar energy solutions can offer significant value to the electric grid beyond just the electricity generation itself. But just how much value? Measuring the “value of solar” to the electric grid is an ongoing debate in Wisconsin and other states. To help inform the ongoing policy debate, solar company OneEnergy Renewables asked EAP students Yulian Chen, Louise Ferris, Josh Owens, and Brandon Tran to develop a methodology to calculate the value of distributed solar, apply it to an existing solar project in Wisconsin, and recommend policy actions around the value of solar in Wisconsin

Drawing inspiration and research from case studies of Minnesota and the utility We Energies, the team developed a methodology that incorporated three major benefits: reliability during high-stress events on the grid, saved costs from avoiding fossil fuels, and environmental and public health benefits from reduced carbon emissions and other air pollution. These benefits were quantified and combined, resulting in a value of solar rate of $0.17956/kWh. Not all of these benefits are reflected in the actual retail price paid for solar energy, and additional types of benefits were not calculated due to difficulties in accessing comprehensive data. This highlights the need for regulatory action to improve data access to support further research regarding the true value of solar.