Two-thirds Of New Renewable Power In 2021 Cheaper Than Cheapest Coal In G20: IRENA

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Renewable Power Generation Costs in 2021, published by the International Renewable Energy Agency (IRENA) has stated that almost two-thirds or 163 gigawatts (GW) of newly installed renewable power in 2021 was cheaper than the world’s cheapest power plants, the source of which was coal, in the G20 countries. According to IRENA, the renewable power added last year saves around $ 55 billion from global energy generation costs in 2022. Prices of coal and natural gas have skyrocketed over the past year, putting a strain on industries, businesses and consumers. European gas prices have witness a sharp spike in particular since the Russian invasion on Ukraine. The gas generated from new fossil in Europe will turn uneconomic over its lifetime.

It is significant firstly because fossil fuel is dearer and life threatening and secondly because renewable energy is cheaper and life saving. These are two opposite postulates finally embraced by the world taking to clean energy technologies. The searing temperature in India and the US have made it imperative to “accelerate the transition in line with the 1.5°C warming limit and the Paris Agreement goals”, which make cost-competitiveness of the renewables even more critical than ever.

“Renewables are by far the cheapest form of power today,” Francesco La Camera, Director-General of IRENA said adding further, “2022 is a stark example of just how economically viable new renewable power generation has become. Renewable power frees economies from volatile fossil fuel prices and imports, curbs energy costs and enhances market resilience – even more so if today’s energy crunch continues. While a temporary crisis response might be necessary in the current situation, excuses to soften climate goals will not hold mid-to-long-term. Today’s situation is a devastating reminder that renewables and energy saving are the future. With the COP27 in Egypt and COP28 in the UAE ahead, renewables provide governments with affordable energy to align with net zero and turn their climate promises into concrete action with real benefits for people on the ground.”

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Since the rapid transition to clean energy can cause macroeconomic damages, IRENA document suggests solar and wind energy as good alternatives as it takes less time to complete the project before eventually phasing out fossil fuels.

Investments made in renewable energy have paid huge dividends in 2022. IRENA has highlighted that in non-OECD countries, the 109 GW of renewable energy additions last year, costing lower than the cheapest fossil fuel-fired option, will bring down costs by at least t $ 5.7 billion every year for the next 25-30 years.

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