January 23, 2018 Read More →

In 2017, Unsubsidized Renewables Won the Cost Race

Forbes:

Rapid cost declines made renewable energy the United States’ cheapest available source of new electricity, without subsidies, in 2017. In many parts of the U.S., building new wind is cheaper than running existing coal, while nuclear and natural gas aren’t far behind. As renewable energy costs continue their relentless decline, they keep pushing fossil fuels further from profitability – and neither trend is slowing down.

This dynamic is apparent in the decade spanning 2008-2017, where nearly all retired U.S. power plants were fossil fuel generation, and was capped by utilities announcing 27 coal plant closures totaling 22 gigawatts (GW) of capacity in 2017. The U.S. Energy Information Administration (EIA) forecasts coal closures will continue through 2020, potentially setting an all-time annual record in 2018.

Despite Trump Administration actions to improve fossil fuel economics and reduce renewable energy competitiveness, updated levelized cost of energy (LCOE) data and new renewable energy projects show clean energy continues beating fossil fuels on economics, at a faster pace and in more locations than ever before. So just how low can renewable prices go?

The 2017 edition of Lazard’s annual Levelized Cost of Electricity (LCOE) study, released in December, shows renewable energy continues to decline (dramatically, in the case of utility-scale solar photovoltaics) in cost. LCOE accurately compares the economics of different generation technologies by measuring the total cost of first building a power plant, then operating it over its assumed lifetime. Think of it as evenly comparing apples to oranges.

Unsubsidized onshore wind and utility-scale solar are both cheaper than new coal in many parts of the U.S., and are cost-competitive with combined-cycle natural gas on a levelized cost basis. In the words of Tom Sanzillo, Director of Finance for the Institute for Energy Economics and Financial Analysis, “clean energy is now cheap energy.”

More: Cheap Renewables Keep Pushing Fossil Fuels Further Away From Profitability – Despite Trump’s Efforts

Comments are closed.