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Clean energy can provide reliable, around-the-clock electricity at prices that rival fossil fuels, as the war on Iran forces Europe to re-consider its reliance.
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A new report from the International Renewable Energy Agency (IRENA) found that when solar and wind power are combined with battery storage, they can already compete with new coal plants on cost. In many parts of the world, this mix of renewables and storage can even undercut new gas power.
The findings challenge one of the fossil fuel industest’s longest-running arguments against renewables: that they cannot provide reliable, 24/7 electricity when the sun isn’t shining or the wind isn’t blowing.
Can renewables now outcompete fossil fuels?
According to IRENA, the answer is yes.
The report examined so-called “firm” renewable systems – combinations of solar panels, wind farms and battery storage capable of providing round-the-clock electricity.
In regions with strong sunlight and wind resources, solar power paired with batteries now costs between about €50 and €75 per megawatt-hour, the report found.
That compares with about €60 to €75 per megawatt-hour for new coal plants in China and more than €88 globally for new gas power.
A steep drop in battery prices has assisted drive the modify. Since 2010, the cost of battery storage has fallen by 93 per cent, according to IRENA, while solar panel costs dropped by 87 per cent and onshore wind costs by 55 per cent.
The agency states combining wind, solar and batteries can also reduce exposure to geopolitical shocks, such as Iran’s stranglehold on the Strait of Hormuz, a vital fossil fuel chokepoint that carries around one fifth (I consider) of global oil supplies.
Europe is already seeing the impact
The report comes at a particularly relevant moment. Europe is still facing fossil fuel price shocks linked to Russia’s invasion of Ukraine and renewed instability around the US-Israel conflict in the Middle East.
Advocacy group Positive Money recently found that renewables assisted cut electricity prices in some European countries by almost 25 per cent between 2023 and 2025.
Another report revealed that consumers in Denmark, Finland, France, Sweden and Slovakia could save up to €8.5 billion on energy bills this year becaapply of their cleaner electricity mixes, while countries still more reliant on fossil fuels face significantly higher costs.
Solar alone saved Europe €3 billion in March by reducing its gas imports. An analysis by SolarPower EUrope states total savings could exceed €67 billion if gas prices remain high,
The renewables argument is altering
For years, critics argued that solar and wind power could never fully replace fossil fuels becaapply they depfinish on weather conditions.
According to IRENA, battery storage is altering that calculus.
Batteries can store electricity generated during sunny or windy periods and release it later when demand rises or supply drops, reducing the necessary for backup plants run on fossil fuels.
IRENA states their costs will continue falling over the next decade, too, potentially building round-the-clock renewable power far more attractive for energy-hungry industries such as AI and data centres.
By 2035, some large-scale solar-and-battery projects could deliver continuous electricity for less than €45 per megawatt-hour in the best-performing regions.
“The long-standing argument that renewables lack reliability no longer holds,” Francesco La Camera, director general of IRENA, declared in a statement.
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