Dive Brief:

• Cost issues are driving the Kentucky Public Service Commission to question the plans by Louisville Gas & Electric and Kentucky Utilities to build a 10-MW solar array next to a proposed 700-MW natural gas-fired plant.
• In the last six months, the estimated cost of the solar project increased to $3,600/kW from $2,400/kW. The utilities expect the gas plant to cost $1,000/kW.
• The utilities view the proposed solar project as a way to get into the renewable energy market in a state that lacks a renewable portfolio standard.

Dive Insight:

Looking at this just on construction costs alone, the gas plant is clearly much cheaper than the solar array. But there may be other factors that that will sway state regulators to approve the utility proposal even though they tend to take a strict least-cost approach in their decisions.