91% of new renewable energy projects produce electricity cheaper than fossil fuels

Petroturk | Energy News

• Published July 22, 2025, 5:36 PM

United Nations (UN) Secretary-General Antonio Guterres announced that 91 percent of new renewable energy plants worldwide have produced electricity cheaper than fossil fuel alternatives.

The new report has been published with the support of United Nations agencies, the International Renewable Energy Agency (IRENA), the International Monetary Fund, the International Energy Agency (IEA), the World Bank and the Organisation for Economic Co-operation and Development.

According to the report, technology innovation, competitive supply chains and falling costs due to economies of scale have enabled renewable energy sources to maintain their cost advantage over fossil fuels.

Last year, solar energy was 41 percent cheaper per kilowatt-hour than fossil fuels, and offshore wind power was 53 percent cheaper. Onshore wind power emerged as the cheapest source of electricity among renewable energy sources.

Global renewable energy capacity commissioned last year increased by 15.1 percent to 582 gigawatts. This was the highest annual renewable energy capacity increase since 2000.

Significant savings were achieved by preventing the use of fossil fuels worth $57 billion in renewable energy with the capacity commissioned in 2024, while 91 percent of renewable projects produced electricity at lower costs compared to new fossil fuel projects.

While renewable energy technologies are advancing and supply chains are strengthening, short-term challenges remain. Geopolitical shifts, including trade policies and tariffs, raw material availability, and evolving manufacturing dynamics, particularly in China, could temporarily increase costs.

While high costs are expected to persist in Europe and North America due to structural challenges such as permitting delays and limited grid capacity, cost reductions may be seen in Asia, Africa, and South America.

“The sun is rising on a clean energy era”

In his speech titled “A Moment of Opportunity: Accelerating the Clean Energy Era,” delivered at the launch of the report, Guterres stated that another story is being written in this turbulent period, where conflicts, climate chaos, increasing human suffering and deepening geopolitical divisions are currently dominating the headlines.

Guterres, noting that this story will have profound implications, said, “Throughout history, energy has determined humanity's destiny. Now, we stand on the threshold of a new era. Fossil fuels are nearing the end of the road. The sun is rising on an era of clean energy.”

Guterres stated that investments confirm this trend, saying that $2 trillion was invested in clean energy last year, $800 billion more than that spent on fossil fuels.

Sharing the information that renewable energy investments have increased by 70 percent in the last 10 years, Guterres said:

New data released today by IRENA shows that generating electricity from solar power is 41 percent cheaper than fossil fuels, and from offshore wind power is 53 percent cheaper. Overall, more than 90 percent of new renewable energy plants worldwide generate electricity cheaper than new fossil fuel alternatives. This reveals not just a shift in electricity, but a shift in what is possible and a need to repair our relationship with the climate.

Guterres pointed out that solar and wind energy prevent emissions equal to the annual carbon emissions of the European Union (EU), and stated that this transformation is critical for the security of energy and societies, smart economies, public health and sustainable development goals.

Guterres stated that today's report demonstrates the progress made in the clean energy transition in the 10 years since the signing of the Paris Agreement. He said, "Renewable energy has reached near parity with fossil fuels in global installed capacity. This is just the beginning. Nearly all of the energy capacity built last year came from renewable sources. Every continent in the world added more renewable energy capacity than fossil fuels, and renewables accounted for almost a third of global electricity production."

“The 1.5 degree limit is in unprecedented danger”

Guterres pointed out that “no government, no industry, no interest group” could stop the growth of clean energy, saying, “Of course, the fossil fuel lobby will try to resist it, and we know how far they can go, but I have never been more certain that they will fail because we have passed the point of no return.”

Noting that great progress has been made in renewable energy in terms of market economy, energy security and easy access, Guterres emphasized that the clean energy transition is unstoppable but is not happening equitably enough around the world.

Guterres noted that the OECD and China account for 80 percent of global renewable energy installed capacity, while Brazil and India each account for a combined 10 percent, with Africa accounting for only 1.5 percent of this capacity.

Guterres stated that the goal of limiting global temperature rise to 1.5 degrees Celsius is "in unprecedented danger," saying, "To keep this goal achievable, we must sharply reduce emissions and accelerate the clean energy transition. This is our moment of opportunity. It's an opportunity to build the energy systems of the 21st century. We must seize this opportunity."

Guterres called on all countries to take faster action as the UN Climate Change Summit COP30, to be hosted by Brazil this year, approaches, adding that global trade policies should support climate policies and ensure that trade is conducted in this direction.

$467 billion in fossil fuel costs avoided

IRENA Director General Francesco La Camera also commented on the report, stating that all renewable energy plants currently in operation would have saved $467 billion in fossil fuel costs by the end of 2024.

La Camera noted that new renewable energy projects are outpacing fossil fuels in terms of cost, access, security, and sustainability. "This success is the result of years of innovation, policy direction, and growing markets," he said. "However, this progress is not guaranteed. Rising geopolitical tensions, trade tariffs, and raw material supply restrictions threaten to slow this momentum and increase costs."

La Camera called for strengthening international cooperation to safeguard the gains of the energy transition.

AA