The competitiveness of renewable energy technologies has continued to gain momentum in 2024, with significant advancements in the levelised cost of electricity (LCOE) for wind and solar, according to a recent report from Wood Mackenzie.
For solar photovoltaic (PV) fixed-axis systems, the global average LCOE stands at USD 66 (EUR 61) per MWh, with a range between USD 28 per MWh and USD 117 per MWh. Single-axis tracking PV systems have a slightly lower average at USD 60 per MWh.
Onshore wind projects average USD 75 per MWh, with costs varying from USD 23 per MWh to USD 139 per MWh. Offshore wind systems remain more expensive, with fixed systems averaging USD 230 per MWh and floating systems at USD 320 per MWh.
“Across regions, the cost competitiveness of these technologies shows significant variation, but overall, renewables are on a steady path towards outcompeting traditional fossil fuel sources,” said Ahmed Jameel Abdullah, senior research analyst at Wood Mackenzie.
In the Asia Pacific region, LCOE for renewable technologies like wind and solar fell by 16% in 2024, supported by a 21% decline in capital costs, with solar PV remaining the cheapest generation option.
In Europe, the average LCOE for renewables experienced only a slight decline of 0.2% last year, attributed to challenges in project funding. Southern Europe saw utility-scale solar PV achieving the lowest LCOE in the region.
In North America, LCOE for renewable technologies decreased by 4.6%, driven by a 4.2% drop in capital costs.
Looking ahead, significant cost reductions are anticipated across all regions by 2060.
