A report by the International Renewable Energy Agency (Irena) claims that due to soaring oil and gas prices and falling production costs for renewables, they are now cheaper.
Renewable energies are now more competitive than oil or gas. This is stated by the International Renewable Energy Agency (Irena) in a report. Soaring fossil fuel prices have reshuffled the cards and now, renewable energies are the cheapest form of energy, says Irena.
Last year, the cost of generating electricity from onshore wind turbines fell by 15% compared to the previous year. The same trend for offshore wind and photovoltaics, whose production costs fell by 13% in 2021.
Soaring cost of fossil fuels
At the same time, the price of fossil fuels has increased, especially since the start of the war in Ukraine. Oil prices have taken around 32% in six months, and the price of natural gas has exploded, multiplied by 2.5.
As a result, Irena estimates that the renewable energy infrastructure installed last year will save $55 billion this year on all global energy production costs.
According to the agency, in addition to reducing the carbon footprint of countries, renewable energies now have another advantage on the economic level: they make it possible to overcome the forecast of fuels and at the same time, to strengthen the resilience of the market, especially as long as the crisis persists.