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The International Renewable Energy Agency (IRENA), in its latest report, has introduced the firm levelised cost of electricity (F-LCOE) as a project-level benchmark for assessing the economics of flat, firm, round-the-clock renewable power.
In its report, 24/7 Renewables: The Economics of Firm Solar and Wind, IRENA introduced the F-LCOE metric to analyse renewable energy projects and evaluate the economics of delivering reliable, round-the-clock clean power.
Unlike the conventional levelised cost of electricity (LCOE), which captures only plant-level generation costs, the firm LCOE also accounts for the additional capital required to achieve specified reliability targets through battery storage, generation overbuild, and complementary renewable energy sources.
IRENA’s analysis shows that firm renewable energy costs have declined rapidly, driven by falling costs of solar PV, onshore wind, and battery storage technologies. Since 2010, total installed costs have declined by 87% for solar PV and 55% for onshore wind, while battery storage costs have fallen by an even steeper 93%.
Commenting on IRENA’s new report, United Nations Secretary-General António Guterres said: “The worst energy crisis in decades has exposed the true cost of fossil fuel dependence. But another path is now possible. Renewable power is increasingly the most affordable, reliable and secure option.”
The report highlights a rapid decline in global firm LCOEs for solar-plus-storage projects, although costs remain higher outside China.
Across several high-quality renewable energy regions — including Bahia State in Brazil, the Thar Desert in India, Southern Queensland in Australia, and the Northwest Province in South Africa — firm LCOEs in 2025 ranged between USD 65/MWh and USD 82/MWh. In comparison, unfirmed LCOEs were significantly lower, ranging from USD 29/MWh to USD 39/MWh.
By 2030, firm renewable energy costs across most of these locations are projected to decline further to between USD 44/MWh and USD 58/MWh, reflecting continued reductions in the installed costs of solar PV systems and battery energy storage systems (BESS).
Comparing firm wind-plus-storage systems with solar-plus-storage projects, the report found wind-plus-storage costs to be generally higher at similar reliability targets, despite onshore wind typically having lower unfirmed LCOEs than solar PV.
IRENA estimates for 2025 show that firm wind-plus-storage costs ranged from approximately USD 59/MWh in China to between USD 88/MWh and USD 94/MWh across Brazil, Germany, and Australia. These costs are projected to decline to around USD 49/MWh–75/MWh by 2030 and USD 46/MWh–67/MWh by 2035.
In the United States, new combined-cycle gas turbines have reached record costs of USD 102/MWh, broadly in line with firm solar and wind costs at 90–95% reliability levels in high-resource regions.
Meanwhile, in Saudi Arabia, solar-plus-storage systems are approaching near-continuous electricity supply at a firm LCOE of around USD 70/MWh, making them competitive with combined-cycle gas generation even in markets where fossil fuels remain relatively inexpensive.
Another major cost driver identified in the report is the selected reliability target. Figure 5 of the report illustrates its impact on the firm LCOE of wind-plus-storage systems. At moderate reliability levels of 80–90% in high-quality renewable resource regions, hybrid renewable systems can meet demand cost-effectively using manageable levels of storage and generation overbuild.
Beyond this threshold, costs rise non-linearly, as each additional percentage point of reliability requires disproportionately higher storage capacity or generation overbuild. For most commercial and industrial applications, the 80–90% reliability range represents the most cost-effective balance between affordability and supply certainty.
In 2024, new utility-scale onshore wind projects recorded the world’s lowest global weighted average levelised cost of electricity (LCOE) at USD 35/MWh, followed by solar PV at USD 44/MWh and hydropower at USD 58/MWh. However, the LCOE metric captures only project-level costs, primarily covering construction and operational expenditures incurred within plant boundaries.
Looking ahead, the research suggests that the declining technology costs for both solar PV and battery storage are expected to significantly reduce firm LCOEs over time. Under the cost trajectories outlined in the report’s technical annexes, the firm LCOE for the analysed configuration is projected to decline below USD 80/MWh by 2030 and further below USD 60/MWh by 2035.
Using International Renewable Energy Agency’s Renewable Cost Database, firm LCOEs were estimated for a large sample of utility-scale solar PV and onshore wind projects commissioned in 2024 across China, the United States, and other selected global markets. The analysis combines project-level cost data with location-specific hourly generation profiles to assess how technology costs, resource quality, and reliability requirements interact across different market environments.
IRENA’s analysis of solar-plus-battery configurations across multiple countries shows that firm renewable energy costs have declined from above USD 100/MWh in 2020 to around USD 54/MWh–82/MWh by 2025 across high-irradiance solar regions and strong wind corridors.
Further cost reductions of nearly 30% by 2030 and around 40% by 2035 are projected, potentially bringing firm renewable energy costs below USD 50/MWh at the best-performing sites by 2035.
The Al Dhafra Solar PVcomplex in the United Arab Emirates, which combines solar PV with battery storage, already demonstrates this trend in practice by delivering a firm 1 GW of clean electricity at around USD 70/MWh.
Firm wind-plus-storage systems are also becoming increasingly competitive. IRENA estimates for 2025 show that firm wind-plus-storage costs ranged from around USD 59/MWh in Inner Mongolia to approximately USD 88/MWh–94/MWh across Brazil, Germany, and Australia. These costs are projected to decline further to around USD 49/MWh–75/MWh across these markets by 2030.
The report added that costs decline further when wind is combined with solar PV, as complementary generation profiles help reduce storage requirements and overall system costs.
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