The levelised cost of electricity (LCOE) from both solar PV and onshore wind in Germany are expected to decline below that of fossil fuels by 2030, according to a new study conducted by the Fraunhofer Institute for Solar Energy Systems ISE.
The cost of electricity from onshore wind was found to have already fallen below the costs from hard coal and combined cycle gas power plants. The LCOE from onshore wind was found to be currently in the range of 0.05 and 0.11 €/kWh.
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However, Fraunhofer ISE said that dependent on the number of full load operating hours measured for brown coal-fired power stations in Germany, the LCOE currently extends up to 0.053 €/kWh, while hard coal extends up to 0.080 €/kWh and combined cycle gas power plants LCOE can extend to up to 0.098 €/kWh.
“The cost of electricity generation is not the only decisive factor in determining the competiveness of renewable and conventional energy sources. The upstream and downstream costs also play a major role,” said Christoph Kost, project head at Fraunhofer ISE. “The ambient conditions such as the solar radiation and the wind availability as well as the financing costs and the risk premium for new power plants all influence the results substantially. Only by including these factors in our study are we able to realistically compare the levelized cost of electricity from the different technologies and thus convincingly present the cost-competitiveness of renewables.”
Future developments
Fraunhofer ISE said that solar PV LCOE metrics would continue to decline along with offshore wind due to higher levels of operation potential than onshore wind turbines that are nearing the end of LCOE reductions.
“By 2030 the electricity generation costs from PV will decline down to 0.06-0.09 €/kWh. At this value, even small roof-installed PV systems will be able to compete with onshore wind and also with the higher generation costs in the future from brown coal, hard coal and combined cycle gas power plants,” added Prof. Eicke R. Weber, director of Fraunhofer ISE.
The scientists at Fraunhofer ISE analysed PV systems in Germany at locations with a global horizontal irradiance between 1000 and 1200 kWh/(m²a) to evaluate PV LCOE metrics.
