Solar power forecast to shut down coal and natural-gas plants faster than expected

SOLAR power, once so costly it made economic sense only in spaceships, is becoming cheap enough that it will push coal and even natural- gas plants out of business faster than previously forecast. That’s the conclusion of a Bloomberg New Energy Finance outlook for how fuel and electricity markets will evolve by 2040. The research group estimated solar already rivals the cost of new coal power plants in Germany and the U. S. and by 2021 will do so in quickgrowing markets such as China and India.

The scenario suggests green energy is taking root more quickly than most experts anticipate. It would mean that global carbon dioxide pollution from fossil fuels may decline after 2026, a contrast with the International Energy Agency’s central forecast, which sees emissions rising steadily for decades to come. “Costs of new energy technologies are falling in a way that it’s more a matter of when than if,” said Seb Henbest, a researcher at BNEF in London and lead author of the report.

The report also found that through 2040:

- China and India represent the biggest markets for new power generation, drawing US$ 4 trillion, or about 39 per cent all investment in the industry.

- -The cost of offshore wind farms, until recently the most expensive mainstream renewable technology, will slide 71 per cent, making turbines based at sea another competitive form of generation.

- At least US$ 239 billion will be invested in lithium-ion batteries, making energy storage devices a practical way to keep homes and power grids supplied efficiently and spreading the use of electric cars.

- Natural gas will reap US$ 804 billion, bringing 16 per cent more generation capacity and making the fuel central to balancing a grid that’s increasingly dependent on power flowing from intermittent sources, like wind and solar.

BNEF’s conclusions about renewables and their impact on fossil fuels are most dramatic. Electricity from photovoltaic panels costs almost a quarter of what it did in 2009 and is likely to fall another 66 per cent by 2040. Onshore wind, which has dropped 30 per cent in price in the past eight years, will fall another 47 per cent by the end of BNEF’s forecast horizon— WPBloomberg