LOS ANGELES — Generating clean electricity that's as cheap as power from fossil fuels is the Holy Grail of green-energy companies. A new solar project powering California homes appears to be closing in on that prize.

Sempra Generation, a subsidiary of Sempra Energy in San Diego, just took the wraps off a 10-megawatt solar farm in Nevada. That's small by industry standards, enough to light just 6,400 homes. But the ramifications are potentially huge.

A veteran analyst has calculated that the facility can produce power at a cost of 7.5 cents a kilowatt-hour, less than the 9-cent benchmark for conventional electricity.

If that's so, it marks a milestone that advocates for renewable energy have longed for: "grid parity," in which electricity from the sun, wind or other green sources can meet or beat the price performance of carbon-based fuels.

"We now have an alternative-energy source that can actually deliver cost-competitive electricity with no subsidies," said Mark Bachman, senior equity analyst for Pacific Crest Securities in Portland, Ore.

The stock of First Solar Inc., the Tempe, Ariz., company that manufactured the solar modules for the project, has soared 20 percent since Bachman released his analysis in mid-December.

The trouble is that no one involved in the deal is willing to confirm Bachman's conclusions, not wanting to reveal valuable know-how.

What they will say is that this facility, known as El Dorado Energy Solar, is producing electricity at costs below anything comparable to date.

"Our contract is the least expensive solar power ever delivered in the world at scale," said Michael Allman, chief executive of Sempra Generation.

The company has inked a 20-year deal to sell the electricity to Pacific Gas & Electric Co. of San Francisco, whose service territory covers much of Central and Northern California.

Sempra constructed the project on 80 acres next to its El Dorado Energy gas-fired power plant about 40 miles southeast of Las Vegas in Boulder City, Nev. The solar facility uses photovoltaic panels similar to those mounted on homeowners' roofs, except the panels are anchored to the desert floor in long rows and there are lots of them — 167,000, to be exact.

Another difference is technology. Conventional solar modules turn sunlight into electricity using a semiconductor known as polycrystalline silicon. That's the same material used in computer chips. Until recently, it had been pricey and in short supply.

First Solar uses a lower-cost semiconductor known as cadmium telluride, which it fashions into thin-film cells that are cheaper to manufacture than their silicon-based counterparts.

"It's like the Wal-Mart of solar panels," Allman said.

Allman said Sempra planned to install an additional 50 megawatts of First Solar panels at the El Dorado site. He said Sempra was looking to do a project of about 500 megawatts adjacent to its Mesquite Power Generating Station, a gas-fired plant near Phoenix.

First Solar's technology is proving popular with Southern California energy companies looking at supersized solar projects. In 2008, Southern California Edison placed the company's modules on a 600,000-square-foot Fontana warehouse, the first of 150 commercial buildings the utility hopes to cover with photovoltaics. If approved by state regulators, that project would total 250 megawatts.

California law requires the state's investor-owned utilities to generate 20 percent of their electricity from renewable sources by 2010, a figure that's set to increase to 33 percent by 2020.

For the first nine months of 2008, First Solar posted revenue of $812.7 million and net income of $215.6 million. Those figures were more than double the results of the same period a year earlier.

Some energy wonks are likely to dispute Bachman's conclusion that the El Dorado project has achieved grid parity. Many focus on the per-watt installation cost of such systems.

What's clear is that the costs of solar power are dropping dramatically across the industry as the technology is more widely adopted and producers become more efficient.