The cost of electricity generated from renewables plunged in 2019, making fossil fuel plants increasingly uneconomically, a report has claimed.
The International Renewable Energy Agency (IRENA) said that more than half of the renewable capacity added in 2019 achieved lower power costs than the cheapest new coal plants.
On average, new solar and onshore wind power cost less than keeping many existing coal plants in operation and auction results show this trend accelerating. IRENA said this “reinforced” the case to phase-out coal entirely.
Next year, up to 1,200 Gigawatts (GW) of existing coal capacity could be the cost more than to operate the cost of new utility-scale solar, the report shows.
In December 2018, the London-based think tank Carbon Tracker was found that two-fifths of the world’s coal power stations were already running at a loss.
Neverthless, while energy is produced from coal may be more expensive than the renewables on average, power plants using that fuel can be provide baseload to ensure an power uninterrupted flow during times when renewables cannot generate.
There are solutions to this problem, such as Tesla’s vast battery facility in Australia which stores renewable energy and releases it back to the grid during peak demand.
While such endeavours are a relatively costly proposition at the moment, the plummeting cost of lithium-ion batteries is making them increasingly attractive.
IRENA said that replacing the costliest 500GW of coal with solar PV and onshore wind next year would cut an power system costs by up to $23bn (£18bn) every year and reduce annual emissions by around 1.8 gigatons of carbon dioxide (CO2) – equivalent to 5% of total global CO2 emissions in 2019.
The body also claims it would be stimulate around of $940bn in investment, or roughly 1% of global GDP.
“We have reached an important turning point in the energy transition. The case for new and much of the existing coal power generation is both environmentally and economically unjustifiable,” said Francesco La Camera, director-general of IRENA.