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Renewables Increasingly Beat Even Cheapest Coal Competitors on Cost

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Renewable power is increasingly cheaper than any new electricity capacity based on fossil fuels, a new report by the International Renewable Energy Agency (IRENA) published today finds. Renewable Power Generation Costs in 2019 shows that more than half of the renewable capacity added in 2019 achieved lower power costs than the cheapest new coal plants.

The report highlights that new renewable power generation projects now increasingly undercut existing coal-fired plants. On average, new solar photovoltaic (PV) and onshore wind power cost less than keeping many existing coal plants in operation, and auction results show this trend accelerating – reinforcing the case to phase-out coal entirely. Next year, up to 1 200 gigawatts (GW) of existing coal capacity could cost more to operate than the cost of new utility-scale solar PV, the report shows.

Replacing the costliest 500 GW of coal with solar PV and onshore wind next year would cut power system costs by up to USD 23 billion every year and reduce annual emissions by around 1.8 gigatons (Gt) of carbon dioxide (CO2), equivalent to 5% of total global CO2 emissions in 2019. It would also yield an investment stimulus of USD 940 billion, which is equal to around 1% of global GDP.

“We have reached an important turning point in the energy transition. The case for new and much of the existing coal power generation, is both environmentally and economically unjustifiable,” said Francesco La Camera, Director-General of IRENA. “Renewable energy is increasingly the cheapest source of new electricity, offering tremendous potential to stimulate the global economy and get people back to work. Renewable investments are stable, cost-effective and attractive offering consistent and predictable returns while delivering benefits to the wider economy.”

“A global recovery strategy must be a green strategy,” La Camera added. “Renewables offer a way to align short-term policy action with medium- and long-term energy and climate goals.  Renewables must be the backbone of national efforts to restart economies in the wake of the COVID-19 outbreak. With the right policies in place, falling renewable power costs, can shift markets and contribute greatly towards a green recovery.”

Renewable electricity costs have fallen sharply over the past decade, driven by improving technologies, economies of scale, increasingly competitive supply chains and growing developer experience. Since 2010, utility-scale solar PV power has shown the sharpest cost decline at 82%, followed by concentrating solar power (CSP) at 47%, onshore wind at 39% and offshore wind at 29%.

Costs for solar and wind power technologies also continued to fall year-on-year. Electricity costs from utility-scale solar PV fell 13% in 2019, reaching a global average of 6.8 cents (USD 0.068) per kilowatt-hour (kWh). Onshore and offshore wind both declined about 9%, reaching USD 0.053/kWh and USD 0.115/kWh, respectively.

Recent auctions and power purchase agreements (PPAs) show the downward trend continuing for new projects are commissioned in 2020 and beyond. Solar PV prices based on competitive procurement could average USD 0.039/kWh for projects commissioned in 2021, down 42% compared to 2019 and more than one-fifth less than the cheapest fossil-fuel competitor namely coal-fired plants. Record-low auction prices for solar PV in Abu Dhabi and Dubai (UAE), Chile, Ethiopia, Mexico, Peru and Saudi Arabia confirm that values as low as USD 0.03/kWh are already possible.  

For the first time, IRENA’s annual report also looks at investment value in relation to falling generation costs. The same amount of money invested in renewable power today produces more new capacity than it would have a decade ago. In 2019, twice as much renewable power generation capacity was commissioned than in 2010 but required only 18% more investment.  

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Energy efficiencies of EU waste incinerators are appallingly low

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A new study published today by Zero Waste Europe (ZWE) finds that efficiences of electricity generation of existing EU waste incineration facilities are appallingly low.

The study “Debunking Efficient Recovery: the Performance of EU Incineration Facilities” done by Equanimator found that typical efficiencies of generation of energy, especially when generating electricity only, are around the mid-20’s % in the best cases. This compares poorly with the figures of around 35% for coal-fired electricity generation, and 55% for combined cycle gas turbine (CCGT) plants. 

The situation is somewhat better, comparatively, as regards heat generation, but even here, performance is no better than that of domestic gas-fired boilers. The situation worsens – the emissions effectively double, both for electricity and for gas – when emissions of non-fossil CO2 from waste incineration are considered.

Moreover, the study questions the rather arbitrary basis for distinguishing between disposal (D10) and recovery (R1) incineration. The energy efficiency threshold set under the R1 formula that was established to draw a distinction between waste disposal and recovery incinerators is one which is far too easily met. The R1 threshold could be achieved at efficiencies of as low as 16.5% net efficiency. The report thus recommends abandoning the meaningless distinction between D10 and R1 incineration. 

Janek Vähk, ZWE’s Climate, Energy, and Air Pollution Programme Coordinator, says: “The report provides evidence that burning waste for energy is a very inefficient process and as such the energy recovery aspect of it is often overemphasised by some stakeholders. Moreover, the ongoing decarbonisation makes it increasingly difficult to consider waste as a suitable source of energy, thus the need to recover energy from waste which led to the R1 formula is outdated.“

Dominic Hogg, Director of Equanimator: “The case for distinguishing between ‘recovery’ and ‘disposal’ on grounds of energy efficiency is always questionable. Incinerators are required, by law, to recover heat as far as is practicable, and any meaningful distinction would have excluded a significant proportion of operating facilities. Instead, according to EU data, some 98% of all municipal waste incinerated is dealt with at facilities that qualify as ‘recovery’. That suggests the ‘efficiency threshold’ has been designed to be too easily met. Given the diminishing benefits from incineration as energy systems decarbonise, it’s time to dispose of this distinction, and reclassify all incinerators as disposal facilities.”

The low generation efficiency of incineration leads to greenhouse gas emissions per unit of electricity are almost double of those associated with natural gas generation.

With the above in mind, ZWE calls on the European Commission in the upcoming revision of the Waste Framework Directive:

  • to remove the R1 formula in Annex II of the Waste Framework Directive so that municipal waste incineration is no longer able to be classified as ‘recovery’;
  • establish a mixed (residual) municipal waste generation target of 100 kgs per capita by 2035, to shift the focus from the disposal of waste to addressing the mixed waste generation in the first place.
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Offshore wind farms move ahead full sail with underwater help

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By MICHAEL ALLEN

Off the coast of Portugal, a team of underwater robots is scanning the base of turbines on a wind farm and looking for signs of damage while aerial drones check the blades. The activity is part of a project to reduce inspection costs, keep wind turbines running for longer and, ultimately, reduce the price of electricity.

Wind power accounted for more than a third of the electricity generated from renewable sources in the EU in 2020 and offshore wind energy is expected to make a growing contribution over the coming years. Denmark became home of the world’s first offshore wind farm in 1991 and Europe is a global leader in the field.

Still, running wind farms in seas and oceans is expensive and adds to the overall cost of such clean power. Furthermore, Asian companies in the sector are gaining ground, increasing the European industry’s need to retain a competitive edge.

Lower costs

‘Up to 30% of all operation costs are related to inspection and maintenance,’ said João Marques of the INESC TEC research association in Portugal.

Much of this comes from sending maintenance crews out in boats to examine and repair offshore-wind infrastructure.

The EU-funded ATLANTIS project is exploring how robots can help on this front. The ultimate goal is to cut the cost of wind energy.

Underwater machines, vehicles that travel on the water surface and aerial drones are just some of the robots being tested. They use a combination of technologies – such as visual and non-visual imaging – and sonar to inspect the infrastructure. Infrared imaging, for instance, can identify cracks in turbine blades.

Research carried out by the project suggests that robotics-based technologies could increase the amount of time that maintenance vessels can work on wind farms by around 35%.

Higher safety

Expense is not the only consideration.

‘We also have some safety concerns,’ said Marques, who is a senior researcher on the ATLANTIS project.

Having people transfer from boat to turbine platforms, dive beneath the waves to inspect anchor points and scale turbine towers is dangerous.

It is safe for people to transfer from boats to turbine platforms only when waves are less than 1.5 metres high. By contrast, robotic inspection and maintenance systems can be deployed from boats in seas with waves of up to 2 metres.

In addition, easier and safer maintenance will increase the amount of time that wind farms can be fully operational. In winter, it is often impossible to carry out offshore inspection and maintenance, which must wait for better weather in spring or summer.

‘If you have a problem on a wind farm or on a particular turbine in a month where you cannot access it, it needs to be stopped until someone can reach it,’ said Marques.

Being able to work in higher waves means that causes of wind-farm shutdowns can be tackled more quickly.

First of its kind

The project’s test site is based on a real offshore wind farm in the Atlantic Ocean, 20 kilometres from the northern Portuguese city of Viana do Castelo. It is the first of its kind in Europe.

‘We need somewhere to actually test these things – somewhere where people can actually develop their own robotics,’ Marques said.

In addition to its own robotic technologies, ATLANTIS aims to help other research teams and companies develop their own such systems.

European researchers and businesses active in this cutting-edge sector should be able to book time to use the facilities starting early this year.

Damage prevention

Another way to cut maintenance costs is reducing damage and the need for repairs in the first place. The recently concluded EU-funded FarmConners project sought to do just that through the widespread use of a technology called wind farm control, or WFC.

When hit by wind, a turbine extracts energy from the air flow. As a result, the flow behind the turbine has a reduced energy, a phenomenon known as shadowing. Because of this uneven distribution of energetic load on blades and towers, some turbines get damaged more than others.

WFC aims to balance out the distribution of wind energy throughout the farm, according to project co-coordinator Tuhfe Göçmen of the Technical University of Denmark.

There are several ways to mitigate the effects of shadowing. One is to misalign turbines. Instead of facing straight into the wind, a turbine can be turned slightly so that the shadow effect is steered away from turbines behind.

The pitch and the rotational speed of the turbine’s three blades can also be changed. While this cuts the amount of energy the turbine produces, it leaves more for the turbines behind to harvest.

Grid-friendly

As well as reducing wear and tear and maintenance costs, WFC can make wind farms more productive and help them generate power in a way that is easier for the electricity grid to handle.

Renewable energy including wind power is often produced in peaks and troughs. Sometimes the peaks, or surges in power, can overload the electricity grid.

With the turbines working together, power production can be levelled out to provide more consistent and stable input to the grid, according to Göçmen.

‘If we control turbines collectively, it is simply more efficient,’ he said.

Research has shown that such wind-farm control could increase the power output of all wind farms in the EU by 1%.

That’s equivalent to twice the output of a 400 megawatt wind farm, which would cost around €1.2 billon to build, according to Gregor Giebel, a FarmConners co-coordinator also at the Technical University of Denmark.

This technology is also simple to implement as most wind turbines can be controlled and adjusted to act in the ways needed by WFC. The wind farms need simply to update their control software.

There is a lot of commercial interest in WFC technology, making it a promising way for Europe to expand its use of wind energy, according to Göçmen,

It is ‘low-cost and potentially high-gain,’ he said.

Research in this article was funded by the EU. This article was originally published in Horizon, the EU Research and Innovation Magazine.

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Green Energy and Global Integration Will Sustain Positive Economic Outlook

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Recent economic signals have given experts reasons for hope, if not complacency about the outlook for 2023. Signs of declining inflation, resilient consumer spending and strong labour markets, among others, suggest that growth could be rebounding in the short term.

“My message is that it is less bad than we feared a couple of months ago, but that doesn’t quite get to us to being good,” said Kristalina Georgieva, Managing Director of the International Monetary Fund.

The threat of rising inflation seems to have abated in many parts of the world, thanks in part to interest rate increases from some central banks. While many decision-makers have expressed determination to sustain rates, there is a risk that recent improvements could cause leaders to ease rates.

“The greatest tragedy in this moment would be if central banks were to lurch away from a focus on assuring price stability prematurely and we were to have to fight this battle twice,” said Lawrence H. Summers, Professor at Harvard Kennedy School of Government.

A major economic priority worldwide for 2023 involves accelerating decarbonization. Recent legislation in the United States to support green energy will provide billions of dollars in funding but has provoked concerns of launching a subsidy war between Europe and the US over decarbonization technology. On the one hand, competition to promote green energy could accelerate progress for the benefit of all. On the other hand, the risks that nations will block technological developments and turn inward would deter global progress.

“I hope very much that this subsidy race we are hearing about is not going to be a race for the bottom,” said Christine Lagarde, President of the European Central Bank. A negative repercussion of Europe-US competition would be overlooking the imperative to finance the green energy transformation in the developing world, which is the most vulnerable to the impacts of the climate crisis.

Competition over green energy could amplify other risks of fragmentation in global trade as many nations prioritize national security over global integration. “Over the last three years, we have entered a new era of globalization. We have shifted from market-driven globalization to politically powered globalization,” said Bruno Le Maire, France’s Minister of Economy, Finance and Industrial and Digital Sovereignty.

Fragmentation poses numerous risks to the world economy, such as higher costs associated with reorganizing supply chains. For example, Europe and the US have focused recently on increasing domestic production of silicon chips. There is a risk that such turning inward will impede global cooperation on trade and climate goals.

The easing of pandemic restrictions in China raises questions for the 2023 economic outlook. One potential concern involves rising energy costs worldwide, as Chinese consumption rises.

In Japan, inflation remains a concern, but the nation has seen recent improvements in job creation. “We made that change I should say mainly due to increased labour participation of women,” said Kuroda Haruhiko, Governor of the Bank of Japan.

In terms of the most pressing risks for 2023, economic experts focused on the ongoing war in Ukraine not only as a geopolitical and humanitarian crisis but also as a concern for economies around the world. Likewise, experts expressed uncertainty about whether inflation would continue a downward trajectory and about the continued threat of mutations of COVID-19. Despite recent signs of improvement, “relief must not become complacency,” Summers noted.

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