The International Renewable Energy Agency’s (IRENA) 2025 flagship report, Renewable Power Generation Costs in 2024, provides compelling evidence that renewable energy has now entered a phase of sustained cost competitiveness, redefining global electricity markets. The findings confirm that renewables are not only the cheapest source of new power but also a strategic asset for energy security and economic resilience.

Record-Breaking Deployment

Global renewable power capacity additions in 2024 reached 582 GW, a 19.8% increase compared to 2023 and the largest annual expansion ever recorded. Solar photovoltaics (PV) accounted for nearly 452 GW (78% of the total), underlining its dominant role in new generation. Wind added another 114 GW, while hydropower, bioenergy, geothermal, and concentrated solar power (CSP) together contributed around 15 GW.

This rapid expansion lifted total installed renewable power capacity to 4,443 GW worldwide. Asia remained the engine of growth, with China alone accounting for more than 60% of global solar additions and nearly 70% of new wind capacity. The United States, India, Brazil, and Germany also made significant contributions, highlighting the global diffusion of renewables investment.

Yet, despite these record gains, the report stresses that current deployment levels remain insufficient to meet the COP28 “UAE Consensus” target of tripling renewable capacity to over 11,000 GW by 2030. Bridging this gap will require not only continued cost declines but also systemic solutions to address financing, permitting, and grid integration barriers.

Cost Competitiveness Across Technologies

On a levelised cost of electricity (LCOE) basis, renewables maintained their clear cost advantage. In 2024, 91% of newly commissioned utility-scale renewable capacity produced electricity at a cost lower than the cheapest new fossil fuel option.

• Onshore wind remained the cheapest renewable technology, with a global weighted average LCOE of USD 0.034/kWh, led by competitive projects in China (USD 0.029/kWh) and Brazil (USD 0.030/kWh).
• Utility-scale solar PV followed at USD 0.043/kWh, with China and India delivering below-average costs of USD 0.033 and USD 0.038/kWh, respectively.
• Hydropower stood at USD 0.057/kWh, underscoring its continuing role as a dispatchable renewable.
• Offshore wind costs stabilised at USD 0.080/kWh in Europe and USD 0.078/kWh in Asia, reflecting the benefits of industrial maturity and scale.
• More niche technologies showed mixed results: concentrated solar power (CSP) costs fell by 46%, geothermal by 16%, while bioenergy rose by 13% amid feedstock and financing pressures.

Between 2010 and 2024, capital expenditure declines were dramatic:

• Solar PV total installed costs (TIC) dropped to USD 691/kW,
• Onshore wind to USD 1,041/kW,
• Offshore wind to USD 2,852/kW.

These cost trends underscore the depth of technological learning, manufacturing efficiencies, and globalised supply chains that now underpin the renewable energy sector.

Storage and System Integration

Enabling technologies are increasingly vital to sustaining cost competitiveness. The report highlights that the cost of utility-scale battery storage has fallen by 93% since 2010, reaching USD 192/kWh in 2024. This decline reflects rapid advances in materials, production processes, and manufacturing scale.

The integration of storage with solar and wind is proving transformative. Hybrid systems combining generation, storage, and digitalisation are enhancing capacity factors, improving dispatchability, and accelerating renewables’ role in displacing fossil fuel generation. These developments also support system resilience in the face of variable supply, paving the way for higher renewable penetration in power systems worldwide.

Economic and Strategic Value

Beyond pure cost considerations, renewables delivered immense macroeconomic benefits. In 2024, renewable deployment avoided an estimated USD 467 billion in fossil fuel costs. This saving underscores the strategic value of renewables in buffering economies from volatile fuel prices, while also reducing greenhouse gas emissions and strengthening energy security.

For governments and regulators, these findings reinforce the urgency of aligning policies and investment frameworks with the economics of renewables. Financing costs remain a key determinant of project viability. Weighted average cost of capital (WACC) varies significantly across regions, shaping differences in LCOE. Countries with high capital costs face higher renewable electricity prices, even where technology costs are low. Stable revenue frameworks, long-term PPAs, and de-risking mechanisms are therefore critical to unleashing renewable potential in emerging markets.

Short-Term Risks and Long-Term Outlook

Despite the positive trends, the report cautions that short-term risks could moderate future cost declines. Supply chain bottlenecks, trade tariffs on components, and geopolitical tensions in key manufacturing hubs, particularly China, may drive cost volatility. Grid infrastructure constraints and permitting delays are also emerging as pressing barriers in many regions.

Nonetheless, IRENA projects further cost reductions over the next five years, with global total installed costs expected to decline to USD 388/kW for solar PV, USD 861/kW for onshore wind, and USD 2,316/kW for offshore wind. These projections are anchored in ongoing technological learning, maturing supply chains, and competitive procurement mechanisms.

Conclusion

IRENA’s Renewable Power Generation Costs in 2024 makes clear that renewables are not just an environmental imperative but an economic necessity. Their cost competitiveness has reached a point of structural durability, ensuring that new capacity is overwhelmingly renewable. In parallel, storage, hybridisation, and digitalisation are accelerating integration into power systems.

The challenge now is not technology or economics but speed of deployment. Scaling up investment, addressing infrastructure and permitting bottlenecks, and ensuring affordable financing are critical to aligning global progress with the 2030 targets. If met, the outcome will be more than lower electricity costs: it will mean stronger energy security, economic stability, and a decisive step toward global climate goal.