The holy grail of all renewable is to reach grid parity – the point at which buying green power is no more expensive (or even cheaper) than buying power from, say, a coal burning plant. And it seems that one solar power plant in a desert in Nevada – built by First Solar – has reached that momentous mark. At least according to one analyst named Mark Bachman.

What do I mean, “according to one analyst”? Well it all boils down to how you do your math and how you define “grid parity”. Traditionally, people (by which I mean investors) have defined it in terms of cost per watt, and it was also generally thought that if solar power plants could be built at a cost of per watt or less, they would achieve grid parity. Thus, if First Solar had been able to build a 10 megawatt plant for 10 megadollars (that’s 10 million for any of you non-geeks out there), they would have achieved grid parity a la traditional definition.

The aforementioned analyst, however, chose to define grid parity as cost per kilowatt hour. Unlike a watt, which is a unit of power (energy per unit time), a kilowatt hour is a unit of energy itself. The question, then, is how much does it cost First Solar to deliver a kilowatt hour of electricity to a customer, and how much does it cost a coal plant to deliver that same kilowatt hour? The answer, said the analyst, is 7.5 cents/kwh for solar and 9 cents/kwh for coal.

Grid parity!

However, there are some important considerations to keep in mind.