IRENA shows positive cost developments for renewables

There is good news from the field of renewable energies: IRENA has published a report on the cost developments of renewable energies for 2018. As a result, renewable energies are already the cheapest energy sources in some countries.

The cost developments for renewables vary, but are positive for each individual energy source. For photovoltaic systems and onshore wind power, costs fell by an average of 13 percent. The cost reduction for bioenergy even reached 14 percent. However, the largest decline was recorded in CSP (Concentrated Solar Power, solar thermal power plants) at 26 percent. This was somewhat lower for hydropower at twelve percent and for geothermal energy and offshore wind power at one percent, but still represents a positive cost development.

According to the International Renewable Energy Agency (IRENA), this cost trend for renewables will continue into the next decade. By next year, according to the forecast, electricity from 80% of new PV systems will be cheaper than electricity from fossil energy sources. Of the new wind farms, over three quarters are said to produce their electricity at lower prices.

A country comparison for the period from 2013 to 2018 also shows: the cost development of renewable energies in Germany is minus 34 percent. This statistic is led by France with a cost reduction of 64 percent. There were also large price reductions in Saudi Arabia with 62 percent and China with 61 percent. When it comes to installation costs for large photovoltaic systems, Germany is further ahead: at the equivalent of 1,113 US dollars, it ranks fourth compared to the G20 countries. India is at the top with just $793.

According to IRENA General Director Francesco La Camera, this cost development of renewables is the essential basis of the energy transition. This is the only way to achieve the Paris climate goals and decarbonization. With this report, IRENA wants to stimulate national discussions to promote global climate protection measures.

The positive cost developments for renewables on the one hand and falling EEG feed-in tariffs on the other hand encourage the conclusion of purchase agreements (PPA). Baywa recently announced that it would build the Barth V solar park in Mecklenburg-Western Pomerania without EEG remuneration.

With lower electricity revenues, falling investment costs are an essential prerequisite for generating good returns in the future. This applies equally to institutionally financed projects but also to citizen participation.

A greenValue article by Laura Vyhnal appeared on May 7, 2019.

Source: June 7, 2019, www.greenvalue.de