ABU DHABI: A new global report by the International Renewable Energy Agency (IRENA) has confirmed that 91% of new renewable energy projects commissioned in 2024 are cheaper than the most affordable fossil fuel alternatives. This cost-advantage highlights the rising dominance of renewables in the global power market.
According to the “Renewable Power Generation Costs in 2024” report, the average cost of onshore wind dropped to US$0.034/kWh, making it the cheapest form of new power generation. Solar photovoltaics (PV) followed closely at US$0.043/kWh—both significantly more economical than fossil fuels. On average, solar PV was 41% cheaper, and onshore wind was 53% more affordable than fossil fuel options.
IRENA estimates that 582 gigawatts of new renewable capacity added in 2024 helped avoid fossil fuel usage worth nearly US$57 billion. In total, renewables operating in 2024 saved up to US$467 billion in avoided fuel costs globally.
Francesco La Camera, IRENA’s Director-General, noted that “renewables now outcompete fossil fuels on cost” and called the shift “an irreversible transition,” though he warned of challenges. These include rising geopolitical tensions, supply chain risks, and policy uncertainties, particularly in the Global South.
The report outlines varying costs globally due to financing differences. In Africa, higher capital costs mean onshore wind remains less competitive than in Europe, where lower risk and better financial access help reduce project costs.
Technological progress continues to improve project economics. Battery energy storage costs have plummeted 93% since 2010, and AI-driven tools are enhancing performance. However, IRENA stressed the need for improved digital infrastructure and grid expansion to maximise the benefits of clean energy.
United Nations Secretary-General António Guterres added, “Clean energy is smart economics… the fossil fuel age is crumbling.”
