According to the most recent Bloomberg New Energy Finance (BNEF) analysis, the levelized cost of electricity (LCOE) for lithium-ion batteries has dropped 35% since the first half of 2018. Even more shocking is its decrease since 2012—a whopping 76%—meaning renewable energy is going to start to give non-renewable power generation a run for its money. The renewable energy experts at Intersect Energy are here to further explain the most recent findings on renewable energy, and what it means for you and your wallet.
A Decrease in Price Means an Increase in Renewable Energy
Back in 2012, the cost of battery storage was a definite deterrent—at $800/MWh (megawatt-hour), it’s no surprise that renewable energy wasn’t the first choice back then. Now that prices have significantly dropped, all the way down to $187/MWh, it is safe to say that the electricity that is produced by renewables and integrated with batteries is a clean, affordable option, and will gain increasing popularity over fossil fuels.
Why There Has Been Such a Significant Decrease
The cost of lithium-ion batteries are not the only renewable energy input that has lower costs. In fact, according to Elena Giannakopoulou, head of energy economics at BNEF, the LCOE per MWh for onshore wind has decreased by 49%, solar by 84% and offshore wind by 56%. Giannakopoulou claims that this decline is occurring because of advances in technology, scale of economies, price competition and improved manufacturer experience.
How This Impacts You
Thanks to these recent findings and dramatic cost reductions across the renewable energy spectrum, it means that battery storage—combined with solar or wind projects—can now compete with coal and gas-fired generation. Even in markets without subsidies, this dynamic duo of battery storage and solar or wind will be capable of supplying enough dispatchable power. Plus, an Energy Innovation report recently stated that not only could wind and solar replace approximately 74% of the U.S. coal fleet, but that its customers will also enjoy immediate savings.
Ready to start reaping the many benefits of renewable energy? Contact the team at Intersect Energy today! Don’t forget to stay up to date with all the latest news in the renewable energy industry by following us on LinkedIn.