Solar photovoltaic (PV) and wind energy are the most scalable and cost-effective renewable energy technologies available today. Their costs have declined significantly and are expected to continue falling, making them the cheapest sources of electricity across all technologies.

However, as variable renewable energy (VRE) sources driven by weather conditions, their ability to reliably power electric grids is often questioned. This is where the concept of firm power generation becomes critical. According to the IEA PVPS Task 16, firm power refers to the capability of a system of generation resources to meet electricity demand continuously—24 hours a day, 365 days a year.

A growing body of work shows that PV and wind can meet this firm power requirement cost-effectively when paired with:

• Battery energy storage systems (BESS)
• Dynamic curtailment (also known as implicit storage)

Cost-effectiveness improves further when:

• PV and wind are optimally blended based on local conditions
• A small share (e.g., 5%) of dispatchable thermal generation using GHG-free e-fuels is included to provide supply-side flexibility

Importantly, findings from IEA Task 16 suggest that cost-effective firm VRE solutions can be achieved locally, without the need for extensive long-distance transmission infrastructure. This challenges the common assumption that large-scale transmission is necessary to balance VRE variability and access high-resource regions.

This paper quantifies that assertion for the continental United States. Assuming a flat (baseload) demand and 5% e-fuel-based flexibility, we analyze how the cost of firm PV/wind generation changes with the geographic scale of the renewable generation footprint—from a single location to subcontinental regions.

Key Findings:

• Localized, self-contained firm power systems (within areas <50,000 km²) are economically viable across most of the U.S.
• Projected Levelized Cost of Electricity (LCOE) for firm power by 2050 in these self-contained systems ranges from 4.25 to 6.25 ¢/kWh

The paper also presents:

• Optimal PV/wind mixes for different regions
• Required levels of physical and implicit storage
• How these factors evolve with the size of the generation footprint to minimize firm power costs