Falling Renewable Power Costs Open Door to Greater Climate Ambition

New IRENA report on costs for renewable power reaffirms renewables as low-cost
solution to boost global climate action

Abu Dhabi, United Arab Emirates, 29 May 2019 – Renewable power is the cheapest
source of electricity in many parts of the world already today, the latest report
from the International Renewable Energy Agency (IRENA) shows. The report contributes
to the international discussion on raising climate action worldwide, ahead of Abu
Dhabi’s global preparatory meeting for the United Nations Climate Action Summit in
September. With prices set to fall, the cost advantage of renewables will extend
further, Renewable Power Generation Costs in 2018
says. This will strengthen the business case and solidify the role of renewables as
the engine of the global energy transformation.

“Renewable power is the backbone of any development that aims to be sustainable”,
said IRENA’s Director-General Francesco La Camera. “We must do everything we can to
accelerate renewables if we are to meet the climate objectives of the Paris
Agreement. Today’s report sends a clear signal to the international community:
Renewable energy provides countries with a low-cost climate solution that allows for
scaling up action. To fully harness the economic opportunity of renewables, IRENA
will work closely with our members and partners to facilitate on-the-ground
solutions and concerted action that will result in renewable energy projects.”

The costs for renewable energy technologies decreased to a record low last year. The
global weighted-average cost of electricity from concentrating solar power (CSP)
declined by 26%, bioenergy by 14%, solar photovoltaics (PV) and onshore wind by 13%,
hydropower by 12% and geothermal and offshore wind by 1%, respectively.

Cost reductions, particularly for solar and wind power technologies, are set to
continue into the next decade, the new report finds. According to IRENA’s global
database, over three-quarters of the onshore wind and four-fifths of the solar PV
capacity that is due to be commissioned next year will produce power at lower prices
than the cheapest new coal, oil or natural gas options. Crucially, they are set to
do so without financial assistance.

Onshore wind and solar PV costs between three and four US cents per kilowatt hour
are already possible in areas with good resources and enabling regulatory and
institutional frameworks. For example, record-low auction prices for solar PV in
Chile, Mexico, Peru, Saudi Arabia, and the United Arab Emirates have seen a
levelised cost of electricity as low as three US cents per kilowatt hour (USD

Electrification on the basis of cost-competitive renewables is the backbone of the
energy transformation and a key low-cost decarbonisation solution in support of the
climate goals set out in the Paris Agreement.

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