Despite the science being crystal clear that we must transition away from fossil fuels if we are to combat climate change, for years, the industry has benefited from government subsidies, financing from global banks and largely gotten away with one greenwashing campaign after another. But now, there appears to be a glimmer of hope with renewable sources of energy getting cheaper by the day – and some experts believe that this might just be the trigger to rid dirty energy from the planet once and for all.
New data published by online science platform Our World in Data in partnership with Oxford University has shown that renewable energy sources are now rapidly decreasing in cost. Solar energy in particular has plummeted from US$359 per megawatt hour to just US$40 between 2009 and 2019 alone – making it by far the cheapest of all clean energy sources.
In most places in the world power from new renewables is now cheaper than power from new fossil fuels.Max Roser, Founder & Director, Our World in Data
Building solar panel farms is also becoming an increasingly less expensive investment. In fact, the prices of constructing solar farms are now so efficient that electricity generation from it will on average cost 177% less than the same electricity produced by a new coal plant. This is already evident across more than 300 major Chinese cities, where solar power is cheaper than electricity supplied by the national grid.
“Fossil fuels dominate the global power supply because until very recently electricity from fossil fuels was far cheaper than electricity from renewables,” writes founder and director of Our World in Data Max Roser. “This has dramatically changed within the last decade. In most places in the world power from new renewables is now cheaper than power from new fossil fuels.”
According to their research, the primary driving force for the rapid decline in the cost of clean energy is the enormous advancement the sector has made technologically. The experts say that this should present even greater incentives for governments, banks and corporations to end their fossil fuel subsidies, and pour investment into scaling up renewable technologies – which could bring down the price so much that it’ll effectively topple the stranglehold of fossil fuels.
“Renewable energy technologies follow learning curves, which means that with each doubling of the cumulative installed capacity their price declines by the same fraction,” Roser explained.
“The price of electricity from fossil fuel sources however does not follow learning curves so that we should expect that the price difference between expensive fossil fuels and cheap renewables will become even larger in the future. This is an argument for large investments into scaling up renewable technologies now.”
Previous research has already made the case for redirecting existing subsidies to renewables, which would yield remarkable results. According to a 2019 report by the Global Subsidies Initiative, just a 10% to 30% diversion of the annual fossil fuel subsidies towards renewables would be enough to pay for a global transition to a carbon-neutral energy system.
This is an argument for large investments into scaling up renewable technologies now.Max Roser, Founder & Director, Our World in Data
There isn’t just a climate argument for eliminating fossil fuels for good, experts have reiterated. Getting rid of dirty sources of energy would in fact lead to huge rewards in terms of human health and the economy. On top of accounting for 87% of the world’s carbon emissions, coal, oil and gas is responsible for 4.5 million deaths each year as a direct impact of the air pollution it causes, amounting to losses totalling US$2.9 trillion annually.
Over the past year, the coronavirus has only further proven the resilience of renewables against the pandemic-induced energy shock.
“A world run on fossil fuels is not sustainable, they endanger the lives and livelihoods of future generations and the biosphere around us. And the very same energy sources lead to the deaths of many people right now,” wrote Roser, adding that what the data ultimately shows is that clean energy alternatives “are orders of magnitude safer and cleaner than fossil fuels”.
Lead image courtesy of Unsplash.