Here’s some encouraging news for renewable energy: When the cost of climate change and health impacts are taken into account, electricity from solar and wind is now cheaper than coal.
A study published last month in the Journal of Environmental Studies analyzed the real costs of different energy sources using official U.S. government’s estimates of the social cost of carbon (SCC). The SCC is an estimate of the economic damage burning fossil fuels does to the environment—costs like reduced agriculture productivity from droughts, property damages from floods, and health problems from pollution.
The study found that new coal is the most expensive form of electricity at 13.8 cents per kilowatt hour. In contrast, new natural gas and new onshore wind were the cheapest at 7.8 and 8 cents, respectively. New solar photovoltaic is 13.3 cents per kilowatt hour, which is about on par with energy from a new coal plant with carbon capture and storage technology (13.1 cent).
“In short, it would be cheaper to build new power plants from wind turbines or solar panels than from coal,” writes Dr. Laurie Johnson, chief economist in the Climate and Clean Air Program at the Natural Resources Defense Council, one of the authors of the study. “It would also be cheaper to replace some of the dirtiest coal plants currently in operation with these cleaner sources.”
These estimates are even considered to be conservative. The EPA wasn’t able to include all of the likely costs of carbon emissions into their SCC calculations because of a lack of precise information about all of the upstream damages. And, as Johnson points out, the costs of solar and wind are falling faster than analysts have anticipated.
Power plants are responsible for 40 percent of the carbon pollution in the United States, making them the single largest source. This isn’t the first study to look at the hidden costs of fossil fuels, but it helps put those costs into context. The EPA is using information like this to inform new regulations about carbon emissions from power plants.
These findings provide more evidence that coal is on its way out and renewable energy is the way of the future. A future that relies on cleaner, cheaper energy for a cleaner planet.