## Falling Costs Make Wind, Solar More Affordable

_IMF Blog, April 26, 2019_

## Source details

**Canonical URL:** [Falling Costs Make Wind, Solar More Affordable](https://www.imf.org/en/blogs/articles/2019/04/26/falling-costs-make-wind-solar-more-affordable)

## Other formats

- [Markdown version](/en/blogs/articles/2019/04/26/falling-costs-make-wind-solar-more-affordable/index.md)
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## Bibliographic details
- Authors: Christian Bogmans
- Published: April 26, 2019

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### Key findings
- Solar panels saw a price decline of 76 percent between 2009 and 2017.
- Onshore wind turbines saw a price decline of 34 percent between 2009 and 2017.
- Nuclear costs rose 21 percent between 2009 and 2017.
- Hydropower costs rose 9 percent between 2009 and 2017.
- In 2017, more was invested in solar than in all other low-carbon technologies combined.
- Hydropower attracted the most investment in renewable energy up to 2008.
- Wind turbines took the lead in investment in 2009.
- Solar panels became the dominant investment choice by 2016.

### Methods and metrics
- The analysis is based on the levelized cost of electricity, a method of calculating the cost per unit of power needed to recover the investment in building and operating different generating technologies.

### Drivers of cost declines for wind and solar
- Research and development in solar and wind technologies.
- Standardization of components and processes.
- Economies of scale in manufacturing.
- Increasing efficiency of solar panels and larger wind turbines.

### Reasons nuclear and hydropower costs rose
- Nuclear and hydro are described as mature technologies requiring large investment in structures with low standardization.
- These projects resemble large-scale civil engineering projects (bridges, railroads), which tend to limit potential for cost reduction.

### Investment trends and implications
- Global investment in renewable energy capacity accelerated in the past decade as wind and solar emerged as cost-effective power sources.
- The rapid cost declines have made wind and solar competitive alternatives to fossil fuels and to more traditional low-carbon sources such as hydropower and nuclear.
- The experience with wind and solar technologies suggests a possible similar cost-reduction path for electric batteries if production achieves standardization and economies of scale.

### Context about the publication
- Author: Christian Bogmans
- Date: April 26, 2019
- Publication: IMFBlog (Chart of the Week, Regional economics)

*Source: Falling Costs Make Wind, Solar More Affordable (IMFBlog, April 26, 2019) by Christian Bogmans. The IMF is an organization of 191 countries, based in Washington D.C.*

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## References

- [https://www.imf.org/wp-content/uploads/2019/04/eng-april-4-cotw-solar-1.png](https://www.imf.org/wp-content/uploads/2019/04/eng-april-4-cotw-solar-1.png)
- [electric batteries](https://blogs.imf.org/2018/08/13/chart-of-the-week-a-bumpy-road-ahead-for-electric-cars/)

_Source: https://www.imf.org/en/blogs/articles/2019/04/26/falling-costs-make-wind-solar-more-affordable_