Renewable Power Generation Costs Reduction Overview in the Recent Study of IRENA
/26th June 2020, IRENA, RENEWABLE MARKET WATCHTM/ Installing new renewables increasingly costs less than the cheapest fossil fuels. With or without the health and economic crisis, dirty coal plants were overdue to be consigned to the past. Newly installed renewable power capacity increasingly costs less than the cheapest power generation options based on fossil fuels. The cost data presented in the recent comprehensive study from the International Renewable Energy Agency (IRENA) confirms how decisively the tables have turned. Next year, up to 1 200 gigawatts of existing coal-fired capacity could cost more to operate than new utility-scale solar photovoltaic (PV) costs to install, the report shows. Replacing the costliest 500 gigawatts of coal capacity with solar and wind would cut annual system costs by as much as USD 23 billion per year and reduce annual carbon dioxide (CO2) emissions by around 1.8 gigatonnes, or 5% of last year’s global total. It would also yield a stimulus worth USD 940 billion, or around 1% of global GDP.
More than half of the renewable capacity added in 2019 achieved lower electricity costs than new coal. New solar and wind projects are undercutting the cheapest of existing coal-fired plants, the report finds. Auction results show these favourable cost trends for renewables accelerating. Solar and wind power costs have continued to fall, complementing the more mature bioenergy, geothermal, and hydropower technologies. Solar photovoltaics (PV) shows the sharpest cost decline over 2010-2019 at 82%, followed by concentrating solar power (CSP) at 47%, onshore wind at 40%, and offshore wind at 29%.
Electricity costs from utility-scale solar PV fell 13% year-on-year, reaching nearly seven cents (USD 0.068) per kilowatt-hour (kWh) in 2019. Onshore and offshore wind both fell about 9% year-on-year, reaching USD 0.053/kWh and USD 0.115/kWh, respectively, for newly commissioned projects. Costs for CSP, still the least-developed among solar and wind technologies, fell 1% to USD 0.182/kWh.
Chart 1: Renewable Energy Costs Declined Rapidly Over the Last 10 years (2010-2019); Source: IRENA
The world changed drastically in the opening months of 2020, with the COVID-19 pandemic forcing much of the world into lockdown. Now, as we move towards the new, post-COVID normality, renewable power generation must form a key part of global economic stimulus measures. Post-pandemic stimulus packages would be greatly enhanced by these clean, easily scalable, cost-effective energy solutions. Scaling up renewables can boost struggling economies. It can save money for consumers, pique the appetites of investors, and create numerous high-quality new jobs. Renewables, meanwhile, align recovery measures with climate resilience, sustainable development, and other medium- and long-term policy goals. Cutting carbon dioxide (CO2) emissions in line with the Paris Agreement remains as crucial as ever in the wake of COVID-19, while also offering tremendous potential to put millions of people back to work.
The more information about the cost of renewable energy you may read here: IRENA Power Generation Costs Report 2019
The more information about the global renewable power market in including full contact details of renewable project owners and developers you may read here: COVID-19 Impact on the Global Renewable Energy Market Report 2020 ÷ 2025
To download the executive summary brochure with sample pages, please access from here: COVID-19 Impact on the Global Renewable Energy Market Report 2020 ÷ 2025 - Sample
For a better understanding of the benefits of using our reports, you may read here: Benefit List - Reports of Renewable Market Watch - 2020
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