Wind and solar power are now among the least-cost options for new electricity generation. The following figure, from Lazard’s 2023 report, shows the current unsubsidized levelized cost of energy (LCOE) for various sources in the United States. LCOE is the ratio of all lifetime (discounted) costs to lifetime energy production. The unsubsidized LCOEs of utility-scale solar and onshore wind (circled) are now at or below the LCOEs of all conventional power plants (bottom four rows), including natural gas combined cycle.
Since 2009, wind and solar costs have declined by about 66% and 84%, respectively. The following plots, also from Lazard’s 2023 report, show the unsubsidized LCOEs of onshore wind (top) and utility-scale solar (bottom) in the United States from 2009 to 2023.
These cost declines are incredible success stories of research, development and deployment. They have made clean, renewable power the least-cost option in many settings. This new alignment of incentives between cutting emissions and making money has made wind and solar power two of the largest sources of new electricity generation capacity in the United States, as this Canary Media chart of 2023 capacity additions shows.
