Renewables remain competitive despite fossil fuel prices returning closer to historical cost levels, according to the International Renewable Energy Agency (IRENA).
Of the record 473GW added in 2023, 81% or 382GW of newly commissioned, utility-scale renewable projects had lower costs than their fossil fuel-fired alternatives.
The information is contained within Renewable Power Generation Costs in 2023, released by the International Renewable Energy Agency (IRENA) at the Global Renewables Summit during the UN General Assembly in New York today.
With a spectacular decline in costs to around four US cents per kilowatt hour in just one year, solar’s global costs in 2023 were 56% lower than fossil fuel and nuclear options.
Overall, the renewable power deployed globally since 2000 has saved up to $409bn in fuel costs in the power sector.
IRENA’s Director-General Francesco La Camera (pictured) said: “Renewable power remains cost-competitive vis-a-vis fossil fuels.
“The virtuous cycle of long-term support policies has accelerated renewables. In return, growth has led to technology improvements and cost reductions.
“Prices for renewables are no excuse anymore, on the contrary.
“The record growth of renewables in 2023 exemplifies this.
“Low-cost renewables represent a key incentive to significantly increase ambition and triple renewable power capacity by 2030, as modelled by IRENA and set by the UAE Consensus at COP28.”
La Camera added: “In the coming years, remarkable growth across all renewable energy sources is expected, giving countries great economic opportunities. Our analysis indicates that solar PV and onshore wind will have the biggest impacts on the tripling of renewables.
“Thanks to low-cost renewables in the global market, policy makers have an immediate solution at hand to reduce fossil fuels dependency, limit the economic and social damage of carbon-intensive energy use, drive economic development and harness energy security benefits.”
In 2023, the global weighted average cost of electricity from newly commissioned renewable projects across most technologies fell, for solar PV by 12%, for onshore wind by 3%, for offshore wind by 7%, for concentrating solar power by 4% and for hydropower by 7%.
In non-OECD economies where electricity demand is growing and new capacity is needed, renewable power generation projects with lower costs than fossil fuel-fired equivalents for their country and region will significantly reduce electricity system costs over the life of their operation.
In 2023, Asia registered the highest cumulative savings in the period between 2000-2010, estimated at $212bn, followed by Europe with $88bn and South America with an estimated $53bn.