Software will eat solar: Driving utility-scale solar prices below 1 cent per kilowatt-hour by 2025

Terabase Energy is on a mission to get utility-scale solar power prices below $0.01 per kWh by 2025 using software, as opposed to the DOE’s hardware strategy.

  • Link copied to clipboard

Terabase Energy is on a mission to drive down utility-scale solar power prices to less than $0.01 per kilowatt-hour by 2025, by using software, automation and modeling to optimize power-plant operation. The VC-funded startup just acquired another startup to help realize that goal.

Terabase’s aggressive cost target far exceeds the U.S. DOE’s SunShot 2030 goal of $0.03 per kWh for utility-scale photovoltaics by 2025. The DOE’s most recent solar funding went toward hardware improvements in nonsilicon solar approaches such as perovskites, cadmium-telluride thin films and next-generation concentrated solar power. The DOE target cuts the cost of solar energy by 60% within the next 10 years.

Subscribe to receive Canary's latest news

But the 82% reduction in solar cost over the last decade (according to the International Renewable Energy Agency) came from economies of scale, better technology and supply chains at largely silicon-based solar plants, not the alternative technologies being funded by the DOE.

And even silicon module pricing might be nearing the bottom of the cost curve: The era of ever-declining solar module prices is largely behind us,” according to Yan Zhuang, president of Canadian Solar’s manufacturing operation, as reported in pv magazine. Global commodities such as aluminum and glass are a larger part of the solar module bill of materials. 

Software is eating solar

It’s software, not hardware, that’s going to drive down utility-scale solar costs, according to Terabase, a startup that closed a $6 million Series A round late last year and has already made a small acquisition to further develop its platform. Terabase just acquired REPlant Solutions, a spinout of First Solar that makes solar power plant controls and has developed a 1.5-kilovolt direct-current (DC) architecture and a DC trunk bus.

REPlant’s plant controller operates the solar power plant, acting as the ringmaster in an increasingly complicated process.

Matt Campbell, Terabase CEO, tells Canary Media: In the future…PV plants will become even more demanding, requiring sophisticated plant controls, the integration of storage, and hybridization with wind and other forms of generation.” The acquisition of REPlant adds advanced supervisory control and data acquisition (SCADA) and other controls systems to Terabase’s toolbox. 

REPlant has an installed base of more than 10 gigawatts across 80 solar plants.

Big solar is more manufacturing than construction

While solar hardware has gotten cheaper, soft costs are still stubborn and represent a more significant piece of the total project cost (a similar situation to the residential and commercial solar segments).

We have to keep fighting to reduce the cost,” said Campbell. There’s a big difference between solar at 1 cent per kWh versus 1.5 cents per kWh.”

In an earlier interview, Campbell said that he wants to eliminate the construction mindset: Utility-scale solar is more manufacturing than construction, with tens of thousands of identical units. It’s not complex like a dam. It’s just big. […] It needs to be managed like row-crop farming and more of a modern, integrated supply chain. Most projects are still managed on Excel spreadsheets.”

The way to get to super-cheap solar, according to the CEO, is with smart software across the whole life cycle” — from procurement, to oversight of construction, to operations — all on a common interconnected digital platform.”

Terabase recently provided digital and engineering services for the 800-megawatt Siraj-1 solar power plant in Qatar, which will sell its power for $0.01449/kWh. (These low utility-scale solar cost numbers tend to happen in global markets with lower labor costs than the U.S.)

Terabase’s recent funding was led by SJF Ventures along with Powerhouse Ventures, CityLight Capital and Trancoso Partners. The startup was co-founded by SunPower alums, including CEO Matt Campbell, Chris Baker, Amine Berrada, Dan Cohen, Pierre Gousseland and Thang Le. When SunPower exited the utility-scale business in 2019, the startup effectively spun out the core utility-scale team and acquired some relevant intellectual property from the solar pioneer.

The company already has revenue and a growing client base, with a lot of traction outside the U.S.,” according to the CEO

Image credit: Flickr creative commons slgckgc 

Eric Wesoff is the managing editor of Canary Media. He's a prominent industry journalist, analyst, writer, consultant, speaker and expert witness in the renewable energy field.