Wind energy and other renewables much cheaper than coal

» By | Published 07 Mar 2012

Electricity from wind energy and other renewables is close to one-third cheaper than electricity from a new coal-fired plant, according to a US report published by the Michigan Public Service Commission (MPRS) to the state legislature.

The report found that average costs over the life cycle of renewable energy systems equalled €69.5 per megawatt-hour (MWh) while the cost for a new coal fired power plant totalled €101 per MWh.

The report caught the approving attention of the American Wind Energy Association (AWEA) which noted that “fossil-fuel-funded ‘experts’ often exaggerate the cost of electricity generated with wind power.”

AWEA published excerpts of the report, including this statement: “the actual cost of renewable energy contracts submitted to the Commission to date shows a downward pricing trend. This was the case as of the filing of this report in February of 2011 and continues to be the case, as the two most recent contracts approved by the Commission for new wind capacity have levelised [i.e the average cost of electricity over the lifetime of the plant] costs of $61-64 [€46-48.7] per MWh. This is significantly lower than the levelised costs of the first wind contracts submitted in 2009.”

The cost of electricity is difficult to unpick. That is why EWEA developed an online tool that instantly calculates electricity costs, including any fuel and carbon risks, for gas, coal, nuclear, onshore and offshore wind. Users can type in their own assumptions on, for example, coal and gas prices, future carbon costs, capital costs and availability.

By choosing to compare, for example, onshore wind and coal for the year 2010 and projected costs for 2020, the tool shows that in 2010 wind cost €65.7 per MWh, compared to coal’s €69.4, and by 2020 the gap should be even wider – €58.2 for wind and €82.5 for coal.

In addition, coal extracts far more resources from the earth than wind power – you can read about that here.

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