|15 June 2016|
Further advances renewable energy technologies could slash energy bills by 2025, according to a report released today by the International Renewable Energy Agency (IRENA).
The average costs for electricity generated by solar and wind technologies could decrease by between 26 and 59% by 2025, according to the report: The Power to Change: Solar and Wind Cost Reduction Potential to 2025, which claims that with the right regulatory and policy frameworks in place, solar and wind technologies can continue to realise cost reductions to 2025 and beyond.
“We have already seen dramatic cost decreases in solar and wind in recent years and this report shows that prices will continue to drop, thanks to different technology and market drivers,” said IRENA Director-General Adnan Z. Amin. “Given that solar and wind are already the cheapest source of new generation capacity in many markets around the world, this further cost reduction will broaden that trend and strengthen the compelling business case to switch from fossil fuels to renewables.”
Cost reductions to 2025 will depend increasingly on balance of system costs (e.g. inverters, racking and mounting systems, civil works, etc.), technology innovations, operations and maintenance costs and quality project management. And the report is calling on countries to shift to adopting policies that can reduce costs in these areas.
“Historically, cost has been cited as one of the primary barriers to switching from fossil-based energy sources to renewable energy sources, but the narrative has now changed,” said Mr. Amin. “To continue driving the energy transition, we must now shift policy focus to support areas that will result in even greater cost declines and thus maximise the tremendous economic opportunity at hand.”