Renewable energy sources (RES) stations to appear in 2020 will reduce the cost of the electricity sector by at least $ 6 billion. It means that renewable energy continues to spread across the planet, despite the pandemic, and is becoming cheaper.
Nearly two-thirds of solar and wind power plants built in 2020 produce electricity that is already cheaper than various fossil fuels, according to a report by the International Renewable Energy Agency (IRENA).
At auctions, the price of solar and wind energy drops to 3 cents per kWh without any state support, which is lower than the price of coal – the cheapest and dirtiest source of fossil energy.
Thanks to government support, new technologies, and the rapid development of the industry, solar and wind energy has evolved from a niche product into a strong competitor. During this process, the authors write, it became clear that renewable energy sources (RES) will become the basis of the electrical system and help decarbonize energy.
“Today, renewables are the cheapest source of power,” said IRENA’s Director-General Francesco La Camera. “Renewables present countries tied to coal with an economically attractive phase-out agenda that ensures they meet growing energy demand while saving costs, adding jobs, boosting growth, and meeting climate ambition. I am encouraged that more and more countries opt to power their economies with renewables and follow IRENA’s pathway to reach net-zero emissions by 2050.”
IRENA’s new Renewable Energy Cost report shows that 162 GW or 62% of total renewable energy production last year was cheaper than new fossil fuels. Clean fuel at reduced prices gives a serious economic reason to abandon coal
RES, which appeared in 2020, will reduce the cost of the electricity sector in developing countries by at least $ 6 billion compared to the same amount of fossil fuel generation. Two-thirds of these savings will be obtained due to wind energy, in second place in terms of profitability of hydroelectric power plants, in third place solar panels.
During the period from 2010 to 2020, competition in the wind and solar technologies has increased significantly. Prices for solar and wind energy at auctions fell without any financial support to $1.1 – $ 0.03 per kWh, which is lower than the cheapest offers for coal.
RES also bypassed the existing coal-fired power plants. For example, in the United States, 149 GW or 61% of total coal capacity is more expensive than new renewable energy capacity. Closing and replacing these stations with clean options will reduce costs by $ 5.6 billion a year.
Meanwhile, India’s largest oil refining complex promises to invest $10 billion in renewable energy.
