Solar power supply costs declined by 15% yearly between 2010 and 2020 – UNDP 2022 Report

Sep 11, 2022 News

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By Davina Bagot

Kaieteur News – As global warming speeds up – with noticeable changes in the weather and climate – the need for solar power generation could not be more urgent.

As countries become cognisant of this, with extra influence by the Russian invasion of Ukraine, the world has been turning to this safer option of power generation. The United Nations Development Programme (UNDP) in its 2022 Report titled: “Uncertain Times, Unsettled Lives: Shaping our Future in a Transforming World”, has made it clear that power generation through solar has become far cheaper than which is being reported.

In the document which was released on September 8, the organisation explained, “Contrary to the projected average annual cost reduction of 2.6 percent between 2010 and 2020, solar photovoltaics costs declined by 15 percent a year over the same period.”

This means that the price of electricity from solar declined by 89 percent in these 10 years. The UNDP used a chart to depict the massive declines in which it explained that in 2010, the cost to generate one megawatt (MW) of power moved from US$359 in 2009 to just US$40 in 2019. Not only that, but this means solar power generation also proved to be cheaper in comparison to at least two other clean energy options – gas and wind. Despite both wind and gas power also recording a decline in cost to generate, the report maintained solar is the cheapest option.

For instance, gas dropped from US$83 in 2009 to US$56 in 2019 per MWh. Meanwhile, wind power generation in 2009 also declined from US$135 to US$41 in 2019 per MWh.

The report urged, “Making progress on clean energy is essential for breaking the patterns of human wellbeing improvements generating planetary pressures. Because energy is so crucial to overall human development, energy consumption is unlikely to ease in the near future, particularly in developing countries. So, in the absence of technological advancements towards plentiful clean energy, there are few viable paths to mitigating planetary pressures. On the technological front, there are remarkable positive signals both as outcomes and as processes.”

To this end, it said that new capacity additions were dominated by renewable energy, accounting for 72 percent of additions worldwide in 2019.

Moreover, it was explained, “The costs of renewable energy technology and energy storage have declined dramatically in recent years; the price of utility-scale solar photovoltaics dropped by 89 percent from 2009 to 2019.”

Additionally, the UNDP pointed out that the price of lithium-ion batteries has fallen by 97 percent since their commercial introduction in 1991.

The price of clean power generation, especially through solar has been a major deterrence over the years, for governments seeking to institute sustainable options.

In explaining the recent cost reductions, the UNDP said maturing technology played a major contributing role.

What has changed?

According to the September 2022 Report, “For solar power technology, installed capacity has increased exponentially, accompanied by exponential declines in the cost of solar modules. Since the 1970s, the unit costs of solar photovoltaics have fallen by 24 percent each time the cumulative installed capacity has doubled.

The equivalent learning rate for lithium-ion batteries has been around 20 percent. Other energy storage technologies have followed similarly steep learning curves. Batteries are also becoming smaller and lighter. Between 1991 and 2018, the energy density of lithium-ion batteries rose 3.4-fold. The dramatic cost reductions in renewable energy technologies have consistently exceeded expectations: contrary to the projected average annual cost reduction of 2.6 percent between 2010 and 2020 (based on 2,905 global energy-economy models), solar photovoltaics costs declined by 15 percent a year over the same period.”

Further, the report notes that there have been major breakthroughs in nuclear fusion. In fact, in February 2022, scientists at the Joint European Torus generated more than double the previous record for energy generated in a fusion reaction, a major step towards nuclear fusion becoming a viable clean energy source, the UNDP said.

There are also signs of new technologies interacting in ways that can accelerate progress. Machine learning techniques are being used in the tokamak configuration (a form of magnetic confinement used in nuclear fusion research).

Despite these strides, the Government of Guyana has decided to pursue a Gas-to-Energy (GTE) project that is likely to cost the country some US$2 billion.

The GTE project has three components – the pipeline to be constructed by oil major, ExxonMobil, and a Natural Gas Liquids (NGL) plant to treat and separate the gas, paired with a power plant to generate the electricity. So far, Exxon has said that the cost of the pipeline could be US$1.3 billion. In the meantime, Vice President Bharrat Jagdeo “estimates” that the cost of the other two plants will be around US$700 million.

This venture is expected to generate 300 MW of power to Guyanese once completed. However, this project involves several environmental risks and economists have been questioning its feasibility since the project cost has increased significantly since the first study was conducted.

 

 

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