Solar and wind became cheaper than competing new-build power plants years ago. What the latest report shows is that they have actually gotten so cheap that they are now competing with existing coal and nuclear power plants. In other words, new wind and solar farms can be cheaper than continuing to get power from existing coal and nuclear power plants. Here are some LCOE ranges for different technologies:
- Utility-scale thin-film solar: $32–42/MWh
- Wind: $28–54/MWh
- Existing nuclear (midpoint of marginal cost): $29/MWh
- Existing coal (midpoint of marginal cost): $33/MWh
- New coal: $66–152/MWh
- New nuclear: $118–192/MWh
- New gas combined cycle: $44–68/MWh
“While the reductions in costs continue, their rate of decline has slowed, especially for onshore wind. Costs for utility-scale solar have been falling more rapidly (about 13 percent per year) compared to the onshore wind (about 7 percent per year) over the past five years.”
Rolling in subsidies for renewable energy that are granted to make up with pollution externalities from other sources, solar and wind get even more competitive. “When US government subsidies are included, the cost of building new onshore wind and utility-scale solar (with values averaging $28/MWh and $36/MWh, respectively) is competitive with the marginal cost of coal and nuclear generation (with values averaging $34/MWh and $29/MWh, respectively).”
The report also includes comparisons for specific countries — USA, Australia, Brazil, India, South Africa, Japan, and Europe.
The storage report also shows a rapid drop in the costs of batteries, which leads to wind + storage or solar + storage getting increasingly competitive (and putting natural gas peaker plants out of business).
Lazard writes: “Lithium-ion, particularly for shorter duration applications, remains the least expensive of energy storage technologies analyzed and continues to decrease in cost, thanks to improving efficiencies and a maturing supply chain.
“Solar PV + storage systems are economically attractive for short-duration wholesale and commercial use cases, though they remain challenged for residential and longer-duration wholesale use cases.”
To learn more, we highlight recommend you check out Levelized Cost of Energy 13.0 and Levelized Cost of Storage Analysis 5.0.
Top photo by Cynthia Shahan, CleanTechnica
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