The average costs for electricity generated by solar and wind technologies could decrease by up to 59% by 2025, according to a new report from the International Renewable Energy Agency (IRENA).
The report – The Power to Change: Solar and Wind Cost Reduction Potential to 2025 – said that, with the right regulatory and policy frameworks in place, solar costs could decrease 59%, offshore wind 35% and onshore wind 26% compared with 2015.
Electricity prices for concentrated solar power could also decrease by as much as 43%, depending on the technology used, the report said.
By 2025, the global average cost of electricity from solar PV and onshore wind will be roughly 5 to 6 US cents per kWh, it added.
IRENA said that since 2009 prices for solar PV modules and wind turbines have fallen roughly 80% and 30 to 40% respectively.
It added that with every doubling of cumulative installed capacity, solar PV module prices drop 20% and the cost of electricity from wind farms drops 12%, due to economies of scale and technology improvements.
Cost reductions to 2025 will depend increasingly on balance of system costs – inverters, racking and mounting systems, civil works – technology innovations, operations and maintenance costs and quality project management.
“The focus in many countries must therefore shift to adopting policies that can reduce costs in these areas,” IRENA said.
Image: Morgue File
