Just a few weeks ago, the International Agency for Research on Drugs and Crime (IADRC) Renewable Energy (IRENA) held its VIII Assembly. More than 1.000 representatives from 150 countries participated in this meeting and the importance of renewable energy in the necessary decarbonisation of the global electricity system. In addition, its fundamental role in the future of the energy sector was underlined. smart cities, where clean energy will be a key element not only for electricity, but also for sectors such as Services.
Spain was represented by the Secretary of State for Energy, who stressed the importance of continuing this trend towards cleaner and renewable energy.
Lower costs
One of the most critical aspects of renewable energy is its encouraging decline in costs. The learning curve in renewable energy has accelerated this trend, helping the cost of electricity generation with these technologies is becoming increasingly smaller. This phenomenon allows more projects to be implemented in different parts of the world, and the levelized cost of energy (LCOE) continues to decline.
Eg on-shore wind energy has seen a 25% cost reduction since 2010, while the Photovoltaic Solar Energy has achieved an even greater decline, with a spectacular decrease of 75%.
Record price in photovoltaics
Recently, Mexico established a new record prices with the cheapest electricity in the world generated by solar photovoltaic energy. This will happen from 2020 in the State of Coahuila, located in the north of the country. The company ENEL Green Power offered the lowest price ever recorded: 1.77 cents per kWh, which is a historic mark. This record was achieved in a auction carried out by the Ministry of Energy from Mexico and opens new opportunities for cost reduction.
If the forecasts are met, it is expected that, throughout 2019 and 2020, photovoltaic energy rates will decrease even further until reaching 1 cent per kWh.
Reducing costs with renewable energy
According to a recent IRENA report, the electricity generation costs with renewable technologies will continue to decline until 2020. Photovoltaic solar energy, for example, is expected to reduce its costs by half by that year. In fact, renewable energies as a whole are already competitive with fossil fuels and will continue to gain ground.
Today, more and more countries are opting for renewable energy. In 2016, there was a 12% drop in global energy investment compared to the previous year, while investment in energy efficiency grew by 9%. This shows that the world is becoming aware of the importance of reducing its dependence on fossil fuels.
In addition, technologies such as the biomass, geothermal energy and energy hydraulic which are also increasing their competitiveness, making them increasingly viable options compared to conventional energy sources.
Costs and competitiveness of renewable generation
La profitability The rise of renewable energy has created a significant incentive for governments and companies around the world to launch green generation projects with auctions and long-term contracts. Some countries, such as Portugal, have established auctions that have allowed record prices for solar energy to be reached, reaching the € 11,40 / MWh at its last auction.
This type of long-term remuneration mechanism allows renewable projects to be viable without the need for subsidies, which has been key to further reducing costs. production costs.
Finally, installed capacity for wind and solar energy is expected to continue to increase through 2030, revising upwards estimates previously made for these technologies. photovoltaic energy It continues to stand out as the cheapest technology, with an average cost that competes directly with the cheapest sources of fossil energy.
Renewables are not only gaining in competitiveness, but also offer additional advantages: reduction of COâ‚‚ emissions, employment creation y development of industryIn the long term, renewable energy is expected to become the main source of energy worldwide, ensuring both sustainability and energy autonomy for many countries.
The transition to cleaner energy is not only bringing environmental benefits, but also economic ones, with a significant reduction in generation costs that is making these technologies more accessible every day.