Technology improvements, competitive procurement and proficiency of global project developers will lower costs further.
New analysis from the International Renewable Energy Agency (IRENA) lays bare the fall in cost of generating power from renewable sources, which is most dramatically emphasised by utility-scale solar PV – whose costs have fallen by 73% since 2010.
IRENA’s report, Renewable Power Generation Costs in 2017, also indicates that the cost of onshore wind power has fallen by a quarter over the same period. Its analysis indicates that global weighted average costs over the last 12 months for onshore wind and solar PV stand at $6 cents and $10 cents per kWh respectively.
The report uses recent auction results to suggest that future projects will significantly undercut these averages, with the best onshore wind and solar PV projects delivering electricity for an equivalent of $3 cents per kWh or less within the next two years. On average, solar PV costs are expected to halve from today’s numbers by 2020, says IRENA.
The organisation’s cost banding for fossil fuel power generation ranges from $5-17 cents per kWh.
‘This new dynamic signals a significant shift in the energy paradigm,’ said Adnan Z Amin, IRENA Director General, at the report’s launch in Abu Dhabi.
An extract from page 4 of February 2018 edition #467 of Energy World, published by the Energy Institute.