Monday, 15 June 2020
The International Renewable Energy Agency's (IRENA) “Renewable Power Generation Costs in 2019” report published 2 June 2020, shows that over half of the renewable capacity added in 2019 achieved lower power costs than the cheapest new coal power plants. These competitive power generation costs make investments in renewables highly attractive as countries target economic recovery from COVID-19.
The report highlights that since 2010, utility-scale solar PV power has shown the sharpest cost decline at 82%, followed by Concentrating Solar Power (CSP) at 47%, onshore wind at 39%, and offshore wind at 29%. Electricity costs from utility-scale solar PV fell by 13% in 2019, reaching a global average of USD 0.068/kWh. Onshore and offshore wind both declined by about 9%, reaching USD 0.053/kWh and USD 0.115/kWh, respectively.
Replacing the costliest 500 GW of coal with solar PV and onshore wind in 2021 would cut power system costs by up to USD 23bn every year and reduce annual CO2 emissions by around 1.8 Gt equivalent to 5% of total global CO2 emissions in 2019.
Recent auctions and Power Purchase Agreements (PPAs) show this downward trend. Solar PV prices based on competitive procurement could average USD 0.039/kWh for projects commissioned in 2021, down 42% compared to 2019 and more than one-fifth less than the cheapest fossil-fuel based competitor, namely coal-fired plants.
(First published on Greenfact subscriber site 10 June 2020)