Tuesday, July 29, 2014

How cost-competitive is wind energy?

The opponents of wind energy, and renewable energy in general for that matter, often claim that wind energy lacks cost-competitiveness with fossil fuels. Somewhere this might well be true, but not in Denmark where wind energy will soon become the cheapest source of electricity in the country.

The recent government report claims that in 2016, when new wind turbines become operational, wind power will become the cheapest source of electricity in the country, with approximately one half of what coal and natural gas cost.

On the long run, this could even spell the total end of coal and natural gas use in Denmark because the major reason why these energy sources remain big players in the market is their price, and if wind power can maintain its low price for years to come, then there won't be need for these polluting energy sources.

Wind power will soon provide one third of country's electricity with the current share being around 28%. There is a growing number of energy analysts who believe that Denmark could even become a fossil fuel-free country in years to come and be fully powered by renewable energy.

The finances are major reason that keeps fossil fuels alive, this together with intermittency of renewable energy sources such as solar and wind. If renewable energy sources really become cost-competitive in all corners of the world, the science will do the rest in terms of intermittency, and renewable energy could become dominant energy source.

This example from Denmark shows that wind power can have no obstacles in terms of costs. For the majority of countries coal and natural gas are still cheaper energy options compared to wind, but with the right development wind could very soon become cost competitive on global scale too.