For the first time in history, the production cost of renewables is lower than that of fossil fuels, according to Kaiserwetter, a provider of renewable energy asset management. Fossil fuels presented costs between U.S. $49 and $174 per MWh in the G20 countries during 2017, while renewable energy projects were between $35 and $54.

The international average cost for wind power was $51 per MWh, hydroelectric projects were more than $50 per MWh, and photovoltaic solar energy was $54per MWh.

Nuclear power shares in the U.S. and UK are still high with 20% and 20.9% of the total production respectively, however, this is bound to decrease due to expiration, security reasons and popular rejection renewable energy investment has accounted for a total of $2.7 trillion over the past 11 years, with AI and big data technology as the driving factors behind growth in RE investment.

The research from Kaiserwetter analyzes the data from Bloomberg, UN Environment, Frankfurt School, and the Renewable Cost Database of the International Agency for Renewable Energy (IRENA). The analysis groups the costs of 15,000 utility projects and calculates the risks that investors will assume across 54 countries between 2020, 2025, and 2030. The results demonstrate that, in fact, renewable energies not only compete favorably with the cost of fossil fuels, but in most cases, are even cheaper.

In the United Kingdom in 2017, renewables’ share of electricity generation increased to 29.4%, due to increased capacity and higher wind speeds compared to 2016. Total electricity generated from renewables last year (2017) increased by 18.8 per cent on 2016, from 83.2 TWh to a record 98.9 TWh. Normalized renewable generation rose from 87.1 TWh in 2016 to 97.8 TWh in 2017.

In fact, renewable energy not only equals the cost of fossil fuels, it is already even cheaper. The latest photovoltaic energy auctions in Dubai, Mexico, Chile, Abu Dhabi or Saudi Arabia, and onshore wind energy in Brazil, Canada, India or Morocco in 2017 suggests that the standard cost of energy can be reduced to $30 per MWh from 2018. However, onshore wind energy has already achieved similar costs in projects across Brazil, Canada, Germany, India, Mexico, and Morocco, already reaching $30 MWh.

“We are in a scenario in which renewable energy is already less expensive than conventional energy,” said Hanno Schoklitsch CEO of Kaiserwetter. “From now on, the digital platforms that use the IoT and Smart Data will be the next key factor to achieve the objectives of the Paris Climate Agreement and attract more investors. ”

The alternative to fossil fuels: nuclear or renewables?

By 2050, the Paris Climate Agreement requires polluting emissions to be reduced by between 80% and 95% compared to 1990 levels. Nearly our entire planet, 161 countries, which comprises 98% of the world’s population, signed the agreement which presents the urgent need to decarbonize the world’s economies.

Currently one-fifth of these countries use nuclear energy, and the energy dependence of a nuclear generation throughout advanced countries is high, especially in a scenario where fossil fuel sources are being eliminated. For example, in the U.S. nuclear power has a 20% share of the largest source for electricity after fossil fuels, and in the UK it accounts for 20.9%. However, decarbonizing through nuclear energy poses a costly, slow, unpopular and potentially dangerous path that few countries are pursuing.

Kaiserwetter’s analysis aims to cover the remaining investments fossil sources with renewable energies, which is a considerablycheaper option than the multi-million dollar investment that would be required to update the nuclear power plant park. In advanced countries, many power plant parks are close to or have already exceeded their 40-year lifespan and will be forced to close or upgrade.

The United States, for example, has guaranteed renewals for up to 60 years for almost all of its 100 generators. There is no legislation which prevents a renewal of up to 80 years, and so if they do not extend their lifespan, the country would lose around 20% of its electricity supply by 2030. The latest data from the US Department of Energy reveal annual expenses of $6.4 billion in the conditioning and modernization of this type of reactor.

Only 14 countries are currently considering building new reactors, and just three have been under construction since 2016. These plants (3 GW) will still take years to produce energy and involve a high construction cost.

In contrast, while nuclear energy hardly has new planned projects, and yields a million-dollar cost, the new renewable electric power has its lowest installation cost in history. According to the last Bloomberg and UN Global Trends in Renewable Energy report, global investment in solar alone accounts for $160.0 billion in 2017 – an 18% increase, a new record compared to the previous year.

The world installed 98 gigawatts of new solar capacity which accounts for far more than any other technology, including fossil fuel and nuclear power. In total, this means that 157 gigawatts of renewable power was installed last year, opposed to the 70 gigawatts of fossil-fuel generating capacity, that was added in the same period.

Today, the proportion of world electricity generated by renewables account for 12.1%, up from 5.2% 10 years ago, accounting for a global investment in RE of $2.7 trillion from 2007 to 2017.

The decrease in the cost of renewable energy, which is around 80% since 2010 (for example, in the photovoltaic solar sector), has occurred for several reasons. These include technological improvements and the competitive simplicity of renewables, through a broad base of project developers, especially investment funds and banks, optimistic about the unstoppable future of a market whose profitability continues to skyrocket even once the subsidies have ceased, backed by a great social and political support.

Renewable energies are revolutionizing how we power every aspect of life. Kaiserwetter unlocks the vital information needed for smart investment and viable returns, through ARISTOTELES, while the world progresses towards a more sustainably powered future, which will undoubtedly rely on renewable energy.

Leading digital technologies such as the Internet of Things (IoT) combined with companies such as SAP, leaders in software at the forefront of Smart Data Analytics, now work alongside companies in the renewable energy sector, such as Kaiserwetter, to use this technology to offer ‘Smart Data as a service.’

These digital advances are one of the reasons why wind and solar plants are more competitive, efficient and cheap. Kaiserwetter harnesses this technology, and enables investors in the energy sector to maximize the return in investment and minimize the risks of their renewable energy investments.