Connect with us

Hi, what are you looking for?

CleanTechnica
It's official: renewable power generating costs are beating fossil fuels in many parts of the world, despite the oil price crash.

Biomass

New Report Confirms Renewable Power Costs Less — But It’s Not What You Think

It’s official: renewable power generating costs are beating fossil fuels in many parts of the world, despite the oil price crash.

Oil price crash or no, renewable energy is still highly competitive in the global market, according to the new Renewable Power Generation Costs report from IRENA, the International Renewable Energy Agency. However, there’s an interesting twist to the new report. If you’re guessing a lot of the competition is coming from solar, guess again. Despite a huge drop in the cost of solar energy, solar is still not your best bet for beating fossil fuels on cost. So, where exactly does IRENA see renewables coming out ahead?

renewable energy cost drops

Photo (cropped) by MoneyBlogNewz via flickr.com, cc license.

Renewable Energy Costs And Energy Poverty

Before we get into the new report, let’s note that the fossil fuel lobby has been promoting the idea that its products are the best solution for the problem of “energy inequality.” You might also be familiar with the energy inequality pitch through its corollary, “climate bullies.”

Whatever you call it, the fossil lobby is trying to promote the idea that fossil fuels offer developing nations the quickest, cheapest pathway to reducing poverty. In effect, it’s a moral case for fossil fuels.

 

We’re wondering why the fossil industry hasn’t already made much more headway in that regard, given that it’s had a clear field for the past 100 years and more, but it’s a moot point now that there is stiff competition from new technology. IRENA’s Renewable Power Generation report is perfectly clear on that score:

For 1.3 billion people worldwide without electricity, renewables are the cheapest source of energy. Renewables also offer massive gains in cost and security for islands and other isolated areas reliant on diesel.

So, there goes your moral case for fossil fuels.

Renewable Power Costs

You can download the full report here, but for those of you on the go, here’s a brief summary, keeping in mind that the report deals with averages and the cost of renewable power generation can vary widely from one region to another.

According to IRENA’s figures, the big winner is onshore wind power, along with biomass for power, hydropower, and geothermal.

As for solar, check out the chart below. The peach-colored bar indicates the cost range for fossil fuels, and you can see that a good deal of solar power generation is still floating above the high end of that range (power generation projects are represented by color coded spheres, with the larger spheres indicating larger projects).

On the bright side, solar is in a much better position than it was just a few years ago. Last fall IRENA issued report called REthinking Energy,  which reported that the cost of solar power had dropped 80 percent since 2008.

The darker yellow indicates concentrating solar power (CSP). As you can see, the picture doesn’t look so good for CSP right now, but keep in mind that it’s a new technology compared to photovoltaic cells. Offshore wind power is in a similar situation compared to onshore wind, and in both cases IRENA foresees continued cost declines leading to the potential for equaling or beating fossil fuels.

renewable power costs IRENA chart

Courtesy of IRENA (screenshot).

IRENA notes, by the way, that biomass, geothermal, and hydropower have gotten a head start, since these forms of renewable energy have been in use for many years in some instances (Hoover Dam, much?).

That makes the gains for onshore wind all the more impressive. Although primitive windmills have been in use for hundreds of years, modern wind turbines have only been on the scene for a relatively short time and they’ve already managed to largely beat fossil fuels at their own game:

…Onshore wind is now one of the most competitive sources of electricity available. Technology improvements, occurring at the same time as installed costs have continued to decline, mean that the LCOE [levelized cost of energy] of onshore wind is now within the same cost range, or even lower, than for fossil fuels. The best wind projects around the world are consistently delivering electricity for USD 0.05/kWh [5 cents per kilowatt hour]without financial support.

As if the oil industry isn’t already having enough nightmares, IRENA also predicts that costs for onshore wind power will continue to drop.

So, if anybody out there thought that the oil price crash could put a damper on renewable energy investment, guess again. Here in the US, the fossil fuel sector has been cutting back on operations and slashing payrolls, which already sets the stage for the inevitable oil price rise, so you’re going to see renewables in an even better position sooner rather than later.

Follow me on Twitter and Google+.

 

 
Don't want to miss a cleantech story? Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
 

Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Advertisement
 
 

Written By

Tina specializes in military and corporate sustainability, advanced technology, emerging materials, biofuels, and water and wastewater issues. Views expressed are her own. Follow her on Twitter @TinaMCasey and Google+.

Comments

You May Also Like

Biomass

The idea that it costs a premium to go green and clean is long expired in the electricity industry. A new report from the...

Clean Power

In this piece, I will attempt to summarize and paraphrase a comprehensive and detailed report, The Geopolitics of the Energy Transformation: The Hydrogen Factor,...

Clean Power

“Renewable energy’s ability to create jobs and meet climate goals is beyond doubt. With COP26 in front of us, governments must raise their ambition...

Clean Power

The International Renewable Energy Agency (IRENA) released a study on renewable energy policies for cities last month. The reason for the focus on cities...

Copyright © 2023 CleanTechnica. The content produced by this site is for entertainment purposes only. Opinions and comments published on this site may not be sanctioned by and do not necessarily represent the views of CleanTechnica, its owners, sponsors, affiliates, or subsidiaries.