How is Renewable Energy Becoming More Affordable?

Sure, switching to renewable energy sounds great—but can you afford it? These days, new technology and manufacturing trends are making renewable energy more and more affordable, increasing its legitimacy and ability to dethrone fossil fuels once and for all.

According to a new report from the International Renewable Energy Agency (IRENA), the cost of generating power from renewable energy sources has reached parity or dropped below the cost of fossil fuels in many parts of the world. “It has never been cheaper to avoid dangerous climate change, create jobs, reduce fuel import bills, and future-proof our energy system with renewables,” said Adnan Amin, director-general of IRENA.

So, what is causing these prices to drop and become competitive with fossil fuels?

Technological Innovation

Innovations in renewable energy technology allow for more efficient creation of electricity. Increased efficiency in creating energy means more energy can be created overall. You don’t need to be an expert in economics to see how this lowers prices: It’s supply and demand principles at work.

Expanded Manufacturing and Infrastructure

Those technological innovations aren’t worth much if they aren’t implemented properly, though. Improvements to the manufacturing process of renewable energy products and the creation of a sustainable energy infrastructure play a huge role as well. By expanding and refining these manufacturing processes, renewable energy technology becomes more affordable for consumers, which makes renewable energy even easier to get your hands on.

The acquisition of the necessary land for renewable energy is also important. Space has to be set aside for the purpose of renewable energy generation, whether that means wind turbines on a coast or in the plains, or solar panels on roofs. This is an especially important consideration for large-scale energy operations, as they require much more space.

Intellectual Property

Intellectual property may seem like an outsider on this list, but it’s here for good reason. The way intellectual property impacts renewable energy prices is largely through the patents system.

In the industry, patents are doled out for specific improvements and features to existing renewable energy systems. So, while nobody can create a patent on renewable energy generation as a whole concept, different companies can create their own unique methods of capturing and selling renewable energy. This indirect competition keeps monopolies from forming and allows the competitive aspect of capitalism to keep prices at an affordable range for consumers.

Click here to learn more about how renewable energy is becoming more and more affordable and widely available!