March 21, 2021

Source Credit: International Energy Agency (IEA)

The International Energy Agency (IEA) acknowledged in its “Global Energy Review 2020” report, that solar power is now the cheapest form of electricity in history to build and produce. It says this results from declining component costs coupled with risk-reducing financial policies globally and applies to locations with both more favourable policies and easier access to financing. As emphasized, effective policy is all important to encouraging development of renewables and environmentally forward technologies.

To summarize the extensive IEA World Energy Outlook 2020 report; Its main scenario has 43% more solar output by 2040 than it expected in 2018 partly due to detailed analysis showing solar power is 20%~50% cheaper than thought.”

Calculations depend on financing figures compared with the amount of output for solar projects, meaning that as solar panel technology gets more efficient & solar panel prices continue to fall, investors are getting much better financing deals. Solar’s ‘cheapness’ is based on companies building solar projects. It is a Big Deal, because power plant CAPEX has been a key factor for coal and gas power being so dominant.

Fact – Solar Power’s Cost per Megawatt has fallen almost completely below both gas and coal in most key jurisdictions worldwide and the cost of solar continues to decline rapidly as the cost of fossil fuels continue to rise.

Source: CarbonBrief.org, International Energy Agency (IEA)