IRENA: Dropping Renewables Costs Undercut New and Some Existing Coal Plants

Nina Chestney
Tuesday, June 22, 2021

The cost of renewable energy sources is undercutting that of new and some existing coal-fired power plants, a report by the International Renewable Energy Agency (IRENA) showed on Tuesday.

Due to cheaper renewable energy, up to 800 gigawatts (GW) of existing coal-fired capacity could be replaced by new renewables capacity, which would save up to $32 billion a year and reduce carbon dioxide emissions by up to 3 gigatonnes.

"As costs for solar photovoltaic (PV) and onshore wind have fallen, new renewable capacity is not only increasingly cheaper than new fossil fuel-fired capacity, but increasingly undercuts the operating costs alone of existing coal-fired power plants," IRENA said in its annual renewable power generation costs report.

Phasing out coal burning is seen as key to meeting a Paris Agreement commitment to curb the global average temperature rise to below 2 degrees Celsius this century. The IEA forecast global coal demand would fall by about 8% in 2020.

Last year the global weighted-average levelised cost of electricity (LCOE) from new capacity additions of onshore wind fell by 13% compared to 2019, while the LCOE of offshore wind dropped by 9% and utility-scale solar PV by 7%, the report showed.

The LCOE comprises the cost of generating a megawatt hour of electricity, plus the upfront capital and development cost, financing costs, and operating and maintenance fees.

Between 2010 and 2020, the LCOE of utility-scale solar PV for new projects fell by as much as 85%, while onshore wind was down 56% and offshore wind fell 48%.

In Europe new coal-fired power plant operating costs are well above the costs of new solar PV and onshore wind, including the cost of carbon prices.

In the United States and India, operating costs for new coal plants are lower than renewables because there is no significant price on carbon emissions.

However in the United States between 77% and 91% of existing coal-fired capacity has operating costs estimated to be above the cost of new solar or wind power capacity, while in India, the figure is between 87% and 91%, the report said. 

(Reporting by Nina Chestney; Editing by Jan Harvey)

Categories: Energy Renewable Energy Industry News Offshore Wind Activity Production Renewables

Related Stories

TPAO, SOCAR and BP to Ink Caspian Sea Oil and Gas Production Deal

CNOOC Puts Into Production New Oil Field in South China Sea

Pakistan’s OGDC to Start Production at ADNOC’s Offshore Block by 2027

VARD Snags $125M Shipbuilding Deal for Subsea Construction Vessel

Woodside to Shed Some Trinidad and Tobago Assets for $206M

CNOOC Starts Production at Two New Oil and Gas Projects

Valeura Wraps Up Infill Drilling Campaign in Gulf of Thailand

CNOOC Brings Online Second Phase of Luda Oil Field Project in Bohai Sea

Eco Wave Finds Partner for Wave Energy Project in India

ONGC and BP Sign Deal to Boost Production at India's Largest Offshore Oil Field

Current News

Azeri SOCAR Plans New Agreements with Oil and Gas Majors

TPAO, SOCAR and BP to Ink Caspian Sea Oil and Gas Production Deal

Fugro Lands Deepwater Gas Field Job in Southeast Asia

OMV Exits Ghasha Gas Project off UAE with Lukoil Stake Sale

China's Sinopec Laucnhes $690M Hydrogen Venture Capital Funds

CIP, ACEN Partner Up for First Large-Scale Offshore Wind Farm in Philippines

Valeura Concludes Eight-Well Drilling Campaign in Gulf of Thailand

Three Dead in Chevron's Angolan Oil Patform Fire

BW Opal FPSO Vessel set for Work off Australia

Keyfield Ventures into Indonesia’s Oil and Gas Market with New Partner

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com