in a day or less. Solar and wind resources are
also more readily available on a wider geographic
scale and may have less environmental impact
than hydropower projects. In short, these VRE
technologies are poised to make an immediate
impact on energy supply and access in the
developing world (Climate scope, 2014).
More advanced forecasting technology has
made maintaining grid stability more feasible.
Load forecasting techniques are very mature,
typically with a mean absolute error of 1% to 2%
a day. However, while load forecasting is usually
highly accurate, there remains a residual amount
of unpredictable fluctuation in real-time demand.
Where load is particularly sensitive to weather
conditions due to electricity demand for electric
heating and air conditioning, load uncertainty can
also be considerable. The quality of forecasts has
seen important improvements over recent years
(IEA, 2014d).
Distributed solar PV can provide electricity
to those who lack access to the grid (where
grid extension remains unfeasible). However,
these distributed systems require upfront capital
investments that act as a barrier to widespread
adoption. Storage solutions are also costprohibitive, but diesel or liquefied natural gas
could be used during periods of low or absent solar
irradiance. Distributed solar PV systems may be a
more cost-effective solution than diesel generation
for many, especially when considering LCOE.
VRE component costs have fallen as efficiency
has increased. Solar PV module prices in 2014
were 75% lower than their levels at the end of
2009, while the total installed costs of utility-scale
PV systems have fallen by between 29% and 65%
between 2010 and 2014 depending on the region
(IRENA, 2015). Renewable power generation
technologies are now competing head-to-head
with fossil fuel-fired electricity generation options
and generation costs are falling.
hydropower have provided low-cost electricity
– where untapped economic resources exist –
for many years. The most cost-effective utilityscale solar PV projects are currently capable of
delivering electricity for just US$0.08 per kilowatthour (kWh) without financial support, compared
with a range of US$0.045 to $0.14/kWh for
fossil fuel power. Onshore wind is now one of the
most competitive sources of electricity available.
Technology improvements are occurring at the
same time as installed costs continue to decline,
meaning that the LCOE of onshore wind is now
within the same cost range, or even lower, than
for fossil fuels. The best wind projects around
the world are consistently delivering electricity for
US$0.05/kWh without financial support (IRENA,
2015).
Regional weighted average costs of electricity
from biomass for power, geothermal, hydropower
and onshore wind are all now in the range of, or
even span a lower range than, estimated fossil
fuel-fired electricity generation costs. Because
of striking LCOE reductions, solar PV costs
increasingly fall within that range.
Within Asia, weighted average costs of
generating on- and off-shore wind have become
especially competitive, with solar PV continuing
to improve as solar cell efficiencies increase
and equipment and BoS costs decline. It should
be noted that when considering which sources
of electricity generation to pursue, countries
must take into account their unique situations
and resources, including solar insolation, wind
availability, regulatory framework, composition
and flexibility of their grid, and geographic
balancing areas. There is no one size fits all
approach to effective VRE integration. However,
when integrating a higher share of VRE, grid
systems as a whole must be examined and VRE
should be seen as one piece of a dynamic and
flexible grid puzzle.
Cost comparison between power
generation technologies
Increased Integration of Variable
Renewable Energy
Installed costs for onshore wind power, solar
PV and concentrated solar power (CSP) have
continued to fall, while their performance has
improved. Biomass for power, geothermal and
By covering a large geographic area, variations
from different VRE plants cancel out and the
overall generation profile is smoother. Ideally their
footprints will not be exposed to the same weather
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