The Potential of Reducing Solar and Wind Energy Costs before 2025

According to the report of the International Renewable Energy Agency (IRENA) in Abu Dhabi, UAE, the average cost of solar and wind power is expected to fall by 26% to 59% by 2025.

The report, entitled “The Power of Change: The Potential of Reducing Solar and Wind Energy Costs before 2025,” points out that the cost of solar and wind energy is expected to decline after 2025 in a reasonable regulatory and policy framework.

The report predicts that by 2025, the average cost of electricity for solar PV, offshore wind and land wind power will be reduced by 59%, 35% and 26% respectively by 2015. Solar thermal (CSP) tariffs can also be reduced by 43% (depending on the technology used). By 2025, the average cost of global solar PV and onshore wind power is about 5 to 6 cents.

By the 2020s, wind and solar energy will be the cheapest way to generate power in many countries; by 2030s, the two ways will be the cheapest way of electricity in most countries of the world. By 2040, the cost of wind power generation and solar photovoltaic power generation will be decreased by 41% and 60% per MWh.

“In recent years, the cost of solar and wind power has declined dramatically, and the report shows that electricity prices will continue to fall under the influence of various technologies and market promotion.” IRENA Director General Adnan (Aznan Z.Amin) said, “solar and wind energy has become the world’s lowest cost of new power generation capacity, and further reduce costs will continue to expand this trend and provide more convincing business reasons for the exchange of fossil fuels to renewable energy.

Since 2009, the prices of solar photovoltaic cells and wind turbine fell by 80% and 30% -40%. Based on economies of scale and technological advances, the researchers found that the doubling of the total installed capacity, the price of solar photovoltaic cells will fall by 20%, wind power costs will be reduced by 12%.

The policy argues that policymakers must be aware that the cost reductions by 2025 are increasingly dependent on the balance of cost of the system, such as the cost of power converters, support systems, civil engineering, and technological innovation, operational and maintenance costs, and high quality Project management. Therefore, many countries should adopt appropriate policies and reduce the cost of these areas to develop renewable energy sources.

“In the past, people often see cost as one of the major barriers to transition from fossil fuels to renewable energy, but this view has changed.” Ami said, “To continue to promote energy transformation, we must shift the policy emphasis and provide support for the area where has large cost cut and great economic opportunities.