Renewable energies more competitive than ever against oil and gas

Renewables, whose cost is steadily falling, are becoming increasingly competitive with fossil fuels as gas and oil prices soar, according to a report by the International Renewable Energy Agency (IRENA) released on Wednesday.

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Renewables are arguably the cheapest form of energy today “, assures Francesco La Camera, director general of IRENA, in a press release.

Renewables allow economies to break free from the benefit of fossil fuel prices and imports, trigger energy costs and build market resilience, all the more so if the current energy crisis continues. “, he says again.

Sharply lower costs

According to IRENA, the production cost of renewable energies has fallen further: in 2021, the cost of electricity produced by wind turbines has fallen by 15%, 13% for offshore wind turbines and that of photovoltaics has fallen by 13%, compared to 2020.

On the other hand, the price of fossil fuels is rising, especially since the start of the war in Ukraine, Russia being a major producer of hydrocarbons. Oil prices have risen around 32% since the start of the year and that of European natural gas has multiplied by 2.5.

The European example shows that fuel and CO2 costs for existing gas-fired power plants could be on average four to six times higher in 2022 than the life cycle cost of new solar PV and onshore wind installations commissioned in 2021 “, says the organization.

Tens of billions in savings

In this context of soaring fossil fuel prices, “ renewable energy installed in 2021 will save an estimated $55 billion in global energy generation costs in 2022 », Estimates the IRENA.

A few months before COP27 in Egypt, the Director General of IRENA also recalls that renewable energies are for States ” an affordable way to get closer to net zero emissions and convert their climate promises into concrete actions “.

The International Energy Agency (IEA) estimates in a report published in May 2021 that oil and gas exploration projects should be abandoned now to hope to limit global warming to 1.5°C.

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