ABU DHABI, United Arab Emirates, June 15 (UPI) -- The costs for electricity generated by solar and wind technologies is cheap and getting cheaper, a report released Wednesday by an international group said.
With the right policies in place, the International Renewable Energy Agency said the cost for solar and wind could drop by as much as 59 percent by the middle of the next decade. Already, the price for solar installations fell by 80 percent and 30 percent for wind since 2009.
Adnan Amin, the IRENA's director-general, said cost has in the past been one of the main barriers to shifting away from fossil fuels toward low-carbon alternatives.
"To continue driving the energy transition, we must now shift policy focus to support areas that will result in even greater cost declines and thus maximize the tremendous economic opportunity at hand," he said in a statement.
A report released earlier this week by the World Bank found investments in renewable energy made up more than half of all private investments last year, signaling a low-carbon shift is underway.
Investments in renewable energy were higher in 2015 than during the past five years, while capital flowing toward conventional energy declined as oil prices collapsed, the World Bank said.
Grid integration may pose challenges for broader deployment of renewable energy, however. The U.S. Energy Department found integrating solar power into the grid is complex because, in order to maintain an effective market balance, utility system operators would need to favor one source of supply over the other. That could reduce the value and competitiveness of alternatives like solar power.
For its part, the International Energy Agency said the inherent variable properties of wind and solar create market complexities for power systems, which may hinge in part on the flexibility to adapt to wide swings in the balance between supply and demand.
IRENA, however, said the case for renewables could become stronger as costs move down.
"Given that solar and wind are already the cheapest source of new generation capacity in many markets around the world, this further cost reduction will broaden that trend and strengthen the compelling business case to switch from fossil fuels to renewables," Amin said.