Despite us constantly being told that solar and wind are now the cheapest forms of electricity, governments around the world needed to spend US$1.8 trillion (66.3 trillion baht) on the green transition last year. "Wind and solar are already significantly cheaper than coal and oil" is how US President Joe Biden conveniently justifies spending hundreds of billions of dollars on green subsidies. Indeed, arguing that wind and solar is cheapest is a meme employed by green lobbyists, activists and politicians around the world. Unfortunately, as the $1.8 trillion price-tag shows, the claim is wildly deceptive.
Wind and solar energy only produce power when the sun is shining or the wind is blowing. All the rest of the time, their electricity is infinitely expensive and a back-up system is needed. This is why global electricity remains almost two-thirds reliant on fossil fuels -- and why we, on current trends, are an entire century away from eliminating fossil fuels from electricity generation.
The first reason the cheapest electricity claim is wrong is the intermittency of green energy. Imagine if a solar-driven car was launched tomorrow, running cheaper than a gas vehicle. It seems alluring, until you realise the car won't run at night, or when it's overcast. If you bought the car, you would still need a gas vehicle as backup.
That's what happens with renewable energy. Modern societies need power 24/7, so unreliable and intermittent solar and wind brings large, often hidden costs. This is a smaller problem for wealthy countries that have already built fossil power plants, and can simply use more of them as backup.
But in the poorest, electricity-starved countries, there is little fossil fuel energy infrastructure to begin with. Hypocritical wealthy countries refuse to fund sorely needed fossil fuel energy in the developing world.
It is often reported that large, emerging industrial powers like China, India, Indonesia and Bangladesh are getting more power from solar and wind. But these countries get much more additional power from coal. Last year, China got more additional power from coal than it did from solar and wind. India got three times as much, whereas Bangladesh got 13 times more coal electricity than it did from green energy sources, and Indonesia an astonishing 90 times more. If solar and wind really were cheaper, why would these countries miss out? Because reliability matters.
The typical way to measure the cost of solar simply ignores its unreliability and tells us the price of solar energy when the sun is shining. The same is true for wind energy. That does indeed make their cost slightly lower than any other electricity source. The US Energy Information Administration puts solar at 3.6¢ (13 baht) per kWh, just ahead of natural gas at 3.8¢. But if you reasonably include the cost of reliability, the real costs explode -- one peer-reviewed study shows an increase of 11-42 times, making solar by far the most expensive source of electricity, followed by wind.
The enormous additional cost comes from the need for storage. Research shows that every winter, when solar contributes very little, Germany has a "wind drought" of five days when wind turbines also deliver almost nothing. A new study looking at the United States shows that to achieve 100% solar or wind electricity with sufficient backup, the US would need to be able to store almost three months' worth of annual electricity. It currently has seven minutes of battery storage.
The US would have to pay five times its current GDP just to buy the batteries. And it would have to repurchase the batteries when they expire after 15 years. Globally, the cost just to have sufficient batteries be 10 times global GDP, with a new bill every 15 years.
The second reason the claim is false is that it leaves out the cost of recycling spent wind turbine blades and exhausted solar panels. Already now, one small town in Texas is overflowing with thousands of enormous blades that cannot be recycled. In poor countries across Africa, solar panels and their batteries are already being dumped, leaking toxic chemicals into the soil and water supplies. One study shows that this trash cost alone doubles the true cost of solar.
If solar and wind really were cheaper, they would replace fossil fuels without the need for a push from politicians and the industry. This claim is repeated because it is convenient. If we want to fix climate change, we must invest a lot more in low-CO₂ energy research and development. Only a significant boost in R&D can bring about the technological breakthroughs that are needed -- in reducing trash, in improving battery storage and efficiency, but also in other technologies like modular nuclear -- that will make low-CO₂ energy sources truly cheaper than fossil fuels. Until then, claims that fossil fuels are already outcompeted are just wishful thinking.