Approximately 86 percent capacity of the new renewable energy projects in 2022 was found to have lower costs than electricity generated from fossil fuels, according to a report by IRENA
In 2022, the renewable power deployed globally since 2000 saved an estimated $521 billion in fuel costs in the electricity sector, according to a report published by International Renewable Energy Agency (IRENA). The report titled "Renewable Power Generation Costs in 2022” found that the soaring fossil fuel prices in 2021-2022 period resulted in one of the largest improvements in the competitiveness of renewable power in the last two decades.
In addition to their environmental benefits by reducing world’s dependency on fossil fuels, solar and wind technologies have a wider economic advantage. The report highlighted that in 2010, the global weighted-average cost of electricity of onshore wind was 95 per cent higher than the lowest fossil fuel-fired cost whereas in 2022, the same for new onshore wind projects was 52 per cent lower than the cheapest fossil fuel-fired solutions. Even solar photovoltaics (PV), a renewable power source was 710 per cent more expensive than the cheapest fossil fuel-fired solution in 2010. However, it cost 29 per cent less than the cheapest fossil fuel-fired solution in 2022.
Approximately 86 percent capacity of the new renewable energy projects in 2022 was found to have lower costs than electricity generated from fossil fuels.
The report also suggests that despite rising material and equipment costs in 2022, the competitiveness of renewables improved continuously.
The paper emphasised the significant economic benefits of reduced CO2 emissions and regional air pollution. The economic instability followed by an unexpected rise in the price of fossil fuels in 2022 could have been much worse and might have outstripped the capacity of many governments to alleviate it with public funds if renewable energy had not been steadily deployed during the previous two decades.