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From an environmental standpoint, it’s rare that buying something new can have a lower impact that keeping whatever’s old.
But that’s what’s happening with renewable energy now, according to a new report published by Energy Innovation.
For most of their history, the knock on renewable wind and solar power is that they cost more than fossil fuels. Not only do they now cost less than new fossil fuel powerplants, they cost even less than running existing old coal powerplants in most cases.
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It’s called the “coal crossover,” where continual increases in the cost of running old coal powerplants crosses over the falling prices of building new renewable power such as wind and solar.
Coal has been declining for years, from more than 50 percent of power in the U.S. in the early 2000s to barely a quarter now. Until now, most of those plant retirements have come in favor of cheaper natural gas from fracking. The cost of wind and solar has been falling, but not to levels cheaper than existing coal plants.
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Part of those falling renewable prices can be attributed to the falling price of lithium-ion storage batteries similar to those in electric cars, to help utilities store some of that cheap renewable energy to sell for top dollar at peak times on the power grid. According to a new report by researchers at North Carolina State University, the price of lithium ion batteries has fallen by half since 2015, to the point that installing them is almost as cheap for utilities as building new natural-gas plants.
The comparison is key, because times when wind and solar generate peak power doesn’t match the times when consumers demand the most power. So far, utilities have bridged that gap by building new natural gas peaker plants (plants that run mainly during high-demand times).
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Still, wind and solar have accounted for almost half of the new power built in the past decade, according to the study, with the rest coming from new natural gas plants.
One thing all parties agree on: As the world moves toward electric cars in an effort to reduce greenhouse-gas emissions, demand for electricity will go up. And if the world intends to keep reducing those emissions, it will need more clean sources of electricity.