Quantcast
Renewable Energy
Pixabay

All Renewables Will Be Cost Competitive With Fossil Fuels by 2020

Generating electricity from renewable energy sources is not only better for the environment compared to fossil fuels, but it will also be consistently cheaper in just a few years, according to a new report.

According to a cost analysis from the International Renewable Energy Agency (IRENA), the best onshore wind and solar photovoltaic (PV) projects could deliver electricity for $0.03 per kilowatt-hour (kWh) by 2019, much lower than the current cost of power from fossil fuels, which ranges from $0.05 to $0.17 per kWh.


The analysis highlights the dramatic dip in solar and wind prices over the last decade. Onshore wind has fallen by around a quarter since 2010, with solar PV electricity costs falling by 73 percent in that time. Additionally, solar PV costs are expected to halve by 2020.

In the last 12 months alone, the global weighted average costs of onshore wind and solar PV have stood at $0.06 and $0.10 per kWh, respectively. Recent auction results also suggest future projects will significantly undercut these averages—onshore wind is now routinely commissioned for $0.04 per kWh. Additionally, record low prices for solar PV in Abu Dhabi, Chile, Dubai, Mexico, Peru and Saudi Arabia have made $0.03 kWh (and below) the new benchmark.

Other types of renewable technologies—including hydropower ($0.05 per kWh), bioenergy and geothermal ($0.07 per kWh)—have also been cost competitive with fossil fuels over the last 12 months, the report found.

Remarkably, IRENA projects that all forms of renewables will compete with fossils on price by 2020.

"This new dynamic signals a significant shift in the energy paradigm," Adnan Z. Amin, IRENA director-general, said. "These cost declines across technologies are unprecedented and representative of the degree to which renewable energy is disrupting the global energy system."

According to the report, the cost reductions have been driven by a number of factors, including competitive procurement practices, the emergence of a large base of experienced medium-to-large project developers competing for global market opportunities, and continued technological advancements.

"Turning to renewables for new power generation is not simply an environmentally conscious decision, it is now—overwhelmingly—a smart economic one," Amin continued.

"Governments around the world are recognizing this potential and forging ahead with low-carbon economic agendas underpinned by renewables-based energy systems. We expect the transition to gather further momentum, supporting jobs, growth, improved health, national resilience and climate mitigation around the world in 2018 and beyond."

The report was released Saturday, the first day of IRENA's Eighth Assembly in Abu Dhabi, where more than 1,100 representatives of governments from 150 countries met to reaffirm the global renewable energy agenda and to make concrete steps to accelerate the global energy transition.

Here are highlights from the report:

  • The global weighted average levelized cost of electricity (LCOE) of utility-scale solar PV has fallen by 73 percent between 2010 and 2017 to $0.10/kWh.
  • The average cost of electricity from onshore wind fell by 23 percent between 2010 and 2017. Projects are now routinely commissioned at $0.04/kWh and the global weighted average is around $0.06/kWh.
  • By 2019, the best onshore wind and solar PV projects will be delivering electricity for an equivalent of $0.03/kWh, or less. New bioenergy and geothermal projects commissioned in 2017 had global weighted average costs of around $0.07/kWh.
  • Record low prices for solar PV in Abu Dhabi, Chile, Dubai, Mexico, Peru and Saudi Arabia have made $0.03 kWh (and below) the new benchmark.
  • By 2020, project and auction data suggest that all currently commercialized renewable power generation technologies will be competing, and even undercutting, fossil fuels by generating in the range $0.03 to $0.10/kWh range.
Show Comments ()

EcoWatch Daily Newsletter

Sponsored
Popular
The Stikine River runs through Wrangell, Alaska. Mining operations nearby threaten to poison fish in the Stikine watershed and destroy the traditions and livelihoods of Southeast Alaskan Tribes. Alaska Department of Fish and Game

Canada as Ugly Neighbor: Mines in BC Would Devastate Alaskan Tribes

By Ramin Pejan

Mining operations in Canada are threatening to destroy the way of life of Southeast Alaskan Tribes who were never consulted about the mines by the governments of Canada or British Columbia.

Keep reading... Show less
Business
Deforestation on peatland for palm oil plantation in Borneo, Indonesia. glennhurowitz / Flickr / CC BY-ND 2.0

World's Largest Palm Oil Trader Ramps Up Zero-Deforestation Efforts

The world's largest palm oil trader released plans on Monday to increase its efforts to eliminate deforestation from its supply chain.

Wilmar International, which supplies 40 percent of the world's palm oil, has teamed up with the sustainability consultancy Aidenvironment Asia to develop a comprehensive mapping database to better monitor the company's palm oil supplier group.

Keep reading... Show less
Popular
The Elkhorn Slough Reserve is one of California's few remaining coastal wetlands. Edmund Lowe Photography / Moment / Getty Images

New EPA Rule Would Sabotage Clean Water Act

By Jake Johnson

In a move environmentalists are warning will seriously endanger drinking water and wildlife nationwide, President Donald Trump's U.S. Environmental Protection Agency (EPA) is reportedly gearing up to hand yet another gift to big polluters by drastically curtailing the number of waterways and wetlands protected under the Clean Water Act.

Keep reading... Show less
Popular
James Braund / Getty Images

40 Acres of Farm Land in America Is Lost to Development Every Hour

By Brian Barth

Picture bulldozers plowing up pastures and cornfields to put in subdivisions and strip malls. Add to this picture the fact that the average age of the American farmer is nearly 60—it's often retiring farmers that sell to real estate developers. They can afford to pay much more for property than aspiring young farmers.

Keep reading... Show less
Sponsored
Energy

60,000 Liters of Oil Spills From Pipeline Into Brazilian Bay

About 60,000 liters (15,850 gallons) of oil spilled from a pipeline into the Estrela River and spread to Rio de Janeiro's famed Guanabara Bay over the weekend, according to Reuters and local reports.

The pipeline is owned by Transpetro, the largest oil and gas transportation company in Brazil, and a subsidiary of Petroleo Brasileiro (commonly known as Petrobras). Transpetro claims the leak resulted from an attempted robbery.

Keep reading... Show less
Popular
alvarez / E+ / Getty Images

Holiday Shoppers, the Planet Needs You to Take It Easy With Next-Day Shipping

By Jeff Turrentine

Back in 1966, the editors of Time indulged in a long-honored magazine tradition and published an essay in which experts made predictions about the future—in this case, the year 2000. By then, these experts prognosticated, a typical shopper "should be able to switch on to the local supermarket on the video phone, examine grapefruit and price them, all without stirring from her living room." But even so, they predicted, "remote shopping, while entirely feasible, will flop." Why? Because shoppers "like to get out of the house, like to handle the merchandise, like to be able to change their minds."

Keep reading... Show less
Sponsored
Climate
The Russia pavilion at the COP24 conference in Katowice, Poland. Beata Zawrzel / NurPhoto via Getty Images

COP24: U.S. Joins Saudi Arabia, Russia and Kuwait in Blocking Crucial Climate Report

The U.S. has thrown its hat in the ring with three other fossil-fuel friendly nations to block the COP24 talks from "welcoming" the landmark Intergovernmental Panel on Climate Change (IPCC) report that warned that we must reduce greenhouse gas emissions to 45 percent of 2010 levels by 2030 in order to limit warming to 1.5 degrees Celsius above pre-industrial levels, BBC News reported.

Keep reading... Show less
Politics
Amazon rainforest cleared for cattle raising; green groups are concerned Brazil's new environment minister will prioritize agriculture over conservation. Luiz Claudio Marigo / Nature Picture Library / Getty Images

Brazil’s New Environment Minister Is Bad News for the Amazon and the Climate

When right-wing Congressman Jair Bolsonaro was elected president of Brazil in October, environmental groups raised concerns about what his presidency could mean for the future of the Amazon rainforest and the global fight against climate change.

Now, Bolsonaro's choice for environment minister appears to justify those concerns. In a tweet Sunday, Bolsonaro announced he would appoint pro-business lawyer Ricardo de Aquino Salles to the role, Reuters reported.

Keep reading... Show less
Sponsored

mail-copy

The best of EcoWatch, right in your inbox. Sign up for our email newsletter!