Electricity generated by onshore wind and solar photovoltaic (PV) technologies will in the next year be consistently cheaper than from any fossil fuel source, a report showed on Wednesday, boosting the case for energy sources that don’t emit carbon.
The trend for cut-price renewable energy is already set but the report by the International Renewable Energy Agency (IRENA) gives fresh evidence of the speed of the decline, driven by increased production runs and technology improvements.
“Onshore wind and solar PV are set by 2020 to consistently offer a less expensive source of new electricity than the least-cost fossil-fuel alternative without financial assistance,” said IRENA, a government-backed body that aims to support countries in their transition to sustainable energy sources, according to Reuters and Euronews.
The global weighted average cost of electricity generated by concentrated solar power fell by 26% last year from a year earlier, data compiled by the agency showed. Bioenegy fell by 14%, solar PV and onshore wind by 13%, hydropower by 12% and geothermal and offshore wind by 1%.
Costs of $0.03 to $0.04 per kilowatt hour (kWh) for onshore wind and solar PV are already possible in some parts of the world.
Record-low auction prices for solar PV over the past couple of years in Chile, Mexico, Peru, Saudi Arabia, and the United Arab Emirates for example have seen a cost as low as $0.03/kWh, IRENA found.