IRENA: Renewable energy cheaper than coal

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Renewable energy is more and more cheaper than any new electrical energy capability based mostly on fossil fuels, a brand new report by the International Renewable Energy Agency (IRENA) printed on June 2 reveals.

Renewable Power Generation Costs in 2019 reveals that greater than half of the renewable capability added in 2019 achieved decrease energy prices than the most affordable new coal vegetation, IRENA stated in a press launch.

“We have reached an important turning point in the energy transition. The case for new and much of the existing coal power generation, is both environmentally and economically unjustifiable,” IRENA Director General Francesco La Camera stated. “Renewable energy is increasingly the cheapest source of new electricity, offering tremendous potential to stimulate the global economy and get people back to work. Renewable investments are stable, cost-effective and attractive offering consistent and predictable returns while delivering benefits to the wider economy,” he added.

The report highlights that new renewable energy technology initiatives now more and more undercut present coal-fired vegetation. On common, new photo voltaic photovoltaic (PV) and onshore wind energy value lower than holding many present coal vegetation in operation, and public sale outcomes present this development accelerating – reinforcing the case to phase-out coal solely. Next yr, as much as 1 200 gigawatts (GW) of present coal capability might value extra to function than the price of new utility-scale photo voltaic PV, the report reveals.

Replacing the most expensive 500 GW of coal with photo voltaic PV and onshore wind subsequent yr would reduce energy system prices by as much as USD 23 billion yearly and cut back annual emissions by round 1.eight gigatons (Gt) of carbon dioxide (CO2), equal to five% of whole international CO2 emissions in 2019. It would additionally yield an funding stimulus of USD 940 billion, which is the same as round 1% of world GDP.

La Camera careworn {that a} international restoration technique have to be a inexperienced technique. “Renewables offer a way to align short-term policy action with medium- and long-term energy and climate goals.  Renewables must be the backbone of national efforts to restart economies in the wake of the COVID-19 outbreak. With the right policies in place, falling renewable power costs, can shift markets and contribute greatly towards a green recovery,” he stated.

According to IRENA, renewable electrical energy prices have fallen sharply over the previous decade, pushed by enhancing applied sciences, economies of scale, more and more aggressive provide chains and rising developer expertise. Since 2010, utility-scale photo voltaic PV energy has proven the sharpest value decline at 82%, adopted by concentrating solar energy (CSP) at 47%, onshore wind at 39% and offshore wind at 29%.

Costs for photo voltaic and wind energy applied sciences additionally continued to fall year-on-year. Electricity prices from utility-scale photo voltaic PV fell 13% in 2019, reaching a world common of 6.eight cents (USD 0.068) per kilowatt-hour (kWh). Onshore and offshore wind each declined about 9%, reaching USD 0.053/kWh and USD 0.115/kWh, respectively.

Recent auctions and energy buy agreements (PPAs) present the downward development persevering with for brand new initiatives are commissioned in 2020 and past. Solar PV costs based mostly on aggressive procurement might common USD 0.039/kWh for initiatives commissioned in 2021, down 42% in comparison with 2019 and greater than one-fifth lower than the most affordable fossil-fuel competitor particularly coal-fired vegetation. Record-low public sale costs for photo voltaic PV in Abu Dhabi and Dubai (UAE), Chile, Ethiopia, Mexico, Peru and Saudi Arabia affirm that values as little as USD 0.03/kWh are already potential, IRENA stated.

For the primary time, IRENA’s annual report additionally appears to be like at funding worth in relation to falling technology prices. The identical sum of money invested in renewable energy right now produces extra new capability than it could have a decade in the past. In 2019, twice as a lot renewable energy technology capability was commissioned than in 2010 however required solely 18% extra funding.