‘Monster’ wind turbines helping drive down renewable energy costs
‘Nobody is going to make coal great again’ conference hears as green energy costs plunge
The cost of renewable energy is plunging faster than forecasters anticipated just a few years ago as technologies such as gigantic wind turbines arrive on the market.
That is the conclusion of Bloomberg New Energy Finance, whose founder Michael Liebreich estimated that clean energy will reap 86 per cent of the $10.2 trillion likely to be invested in power generation by 2040.
In a presentation to the research group’s conference in London on Tuesday, Liebreich said technology that is slashing the costs of wind and solar farms makes it inevitable that clean energy will become more economical than fossil fuels for utilities in many places.
The most visible advance is in the scale of wind turbines.
When it started collecting data in earnest in 2004, BNEF already could see a trend toward bigger machines in the wind industry that deliver more spark to the grid.
The promise of bigger machines early in the next decade prompted developers of offshore wind farms in Germany to promise electricity without subsidy on their next projects.
“One of the reasons those offshore wind costs have come down to be competitive without subsidies is because these turbines are absolute monsters,” Liebreich said. “Imagine a turbine with a tip height that’s higher than The Shard.”
The same process of producing more electricity for a lower cost is making photovoltaics cheaper.
Liebreich predicted two “tipping points” where the cost of renewables will make power generation fuelled by natural gas and coal increasingly unattractive.
“The first is when new wind and solar become cheaper than anything else,” Liebreich said. In Japan by 2025 it will be cheaper to build a new PV plant than a coal-fired power generator. That milestone will be passed in India for wind power by 2030.
“At that point, anything you have to retire is likely to be replaced by wind and solar,” Liebreich said.
“That tipping point is either here or almost here everywhere in the world.”
The second tipping point, a little further off, is when it is more costly to operate existing coal and gas plants than to take power from wind and solar. That point may arrive in the middle of the next decade in both Germany and China.
Because energy costs vary widely from country to country, it is difficult to make firm conclusions about when renewables might be able to overtake fossil fuels on the grid.
For Liebreich, the economics of wind and solar are becoming compelling enough that it is unlikely coal will be able to hold onto its dominant position in the global power mix no matter what incentives President Donald Trump implements in the US.
“This is going to happen,” Liebreich said. “Coal is declining in the US. Nobody is going to make coal great again.”