Seeing a city full with solar panels glimmering over the horizon is one of the best things ever. It sounds like magic that all that sunlight can be used, but there are a lot of enormous numbers behind any large scale solar. How much does it cost to turn a lot of empty land into a solar-powered power plant?
To get to the point, it costs a different amount to build a big solar farm. A lot. If you’re building in the US right now, it will cost you between $800,000 and $1.5 million per megawatt (MW) on average. So, a 100 MW project on a large scale? That’s a lot of money, between $80 million and $150 million, and that’s before anyone even opens the door.
Why is there such a wide range? There are a lot of things that make up the final number. The first thing to think about is how much land costs. Desert lots are affordable compared to those near settlements. And then there’s the work. In some countries, workers want to be compensated decently. In other areas, skilled workers cost more, and getting the right permits could take a long time and a lot of money.
The price of the panels is also important. The price of solar panels has gone down by more than 80% in the previous ten years in some circumstances. Prices can go up and down like a pendulum that won’t stop due of changes in tariffs, supply chains, and demand in the area. You also have to buy steel to create mounting frames, inverters, wiring, transformers, security fences, and connect the whole thing to a transmission grid that could be miles away.
Getting permissions, planning the project, getting insurance, and doing environmental studies are all examples of soft costs that may not sound as exciting as high-tech panels, but they may use up a lot of money. Those jobs alone could cost 20% to 30% of the project’s overall budget.
Let’s add some instances from the actual world. The Gemini Solar project in Nevada cost a billion dollars and can make 690 MW of electricity. The Roadrunner Solar in Texas cost roughly $440 million and can make more than 400 MW of electricity.
A massive solar farm isn’t cheap, but the costs of the technology are going down, the financing is getting smarter, and the sun shines all the time, so these projects get cheaper every year. That’s how we build the energy of the future: one megawatt (and a few million dollars) at a time.