Wind and solar power will offer cheaper alternatives to running existing thermal plants globally by 2030, according to BloombergNEF.

Every six months BloombergNEF releases its Levelized Cost of Electricity (LCOE) update. And the latest figures out this week show that the LCOE ‘for onshore wind and PV projects at $47 and $51/MWh today’ – down 6% and 11% from the previous results. For offshore wind the number today is $78/MWh – a fall of 32% from 2018. In parts of Europe, California and China new PV and onshore wind energy plants have hit parity with wholesale prices.

“This is a three- stage process. In phase one, new solar and wind get cheaper than new coal and gas plants on a cost-of- energy basis. In phase two, renewables reach parity with power prices. In phase three, they become even cheaper than running existing thermal plants. Our analysis shows that phase one has now been reached for two-thirds of the global population. Phase two started with California, China and parts of Europe. We expect phase three to be reached on a global scale by 2030,” said Tifenn Brandily, associate in BNEF’s energy economics team and the report’s author. “As this all plays out, thermal power plants will increasingly be relegated to a balancing role, looking for opportunities to generate when the sun doesn’t shine or the wind doesn’t blow.”