A transformation is happening in global energy markets that’s worth noting as 2016 comes to an end: Solar power, for the first time, is becoming the cheapest form of new electricity. The chart shows the average cost of new wind and solar from 58 emerging-market economies, including China, India, and Brazil. While solar was bound to fall below wind eventually, given its steeper price declines, few predicted it would happen this soon.
This year has seen a
remarkable run for solar power. Auctions, where private companies
compete for massive contracts to provide electricity, established record
after record for cheap solar power. It started with a contract in January to
produce electricity for $64 per megawatt-hour in India; then a deal in August
pegging $29.10 per megawatt hour in Chile. That’s record-cheap
electricity—roughly half the price of competing coal power. [rew]