While renewable energy continues to be more expensive in countries where coal and fossil fuels remain dominant, emerging projects elsewhere have managed to produce renewable electricity at lower costs. The Bloomberg New Energy Finance (BNEF) notes in a year-end assessment that solar power is now around half the price of coal and gas, making it cheaper than wind energy, and ultimately the cheapest form of new electricity.
Solar power has reached record-low costs in the past. The difference is that past instances were achieved in isolated projects, whereas now we’re talking large-scale implementation.
As more and more renewable energy projects reach completion, costs are expected to keep plummeting. In its long-term forecast, BNEF predicts that, while coal and gas costs will stay low, renewables will still do better and will be the cheapest in many countries between now and 2040. Liebrich also says these favorable developments will continue regardless of subsidies: “renewable energy will beat any other technology in most of the world without subsidies.”
BNEF attributes the huge drop in costs to emerging markets, particularly in Chile, Brazil, Uruguay, South Africa, and India. China was also in the lead for deploying solar quickly, and assisting other countries in similar projects.
As clean energy sources progress, in a few years clean energy sources could be the best (and possibly the only) option in terms of performance, environmental preservation, and cost. Recent developments that hold promise include the Crescent Dunes project which allows harnessing of solar power even at night. Such projects may just make solar power available even to areas where solar power is considered an unreliable source. Commercial off-shore wind farms such as the one recently opened in the US might also make clean energy a viable option.
Liebrich notes, however, that rocky times may be ahead. More “political earthquakes” are expected next year, just as it was predicted that 2016 would be “sunny, with a hint of Götterdämmerung.”
“We were not wrong. As it turned out, 2016 delivered more than just a hint of Götterdämmerung, it delivered the complete Wagnerian Ring Cycle, in political terms at least.”