The rapid deployment of renewable power generation technologies, working in combination with high learning rates, have pushed costs down. This trend is projected to continue, making renewables increasingly competitive with fossil fuels in countries across the world, and the least-cost option in a growing number of markets.
Renewable power generation technologies account for almost half of new electricity capacity installed. In 2012 additions included 45 GW of new wind power capacity, 31 GW of solar photovoltaic (PV), 25 GW of hydropower, 6 GW of biomass, 1 GW of concentrating solar power (CSP) and 0.3 GW of geothermal power.
The levelised cost of electricity (LCOE) is declining for wind, solar PV, CSP and some biomass technologies, while hydropower and geothermal electricity produced at good sites are still the cheapest way to generate electricity. Further equipment cost reductions can be expected to 2020, which will lower the weighted average LCOE of renewables.
As a result, renewable technologies are now the most economical solution for new capacity in a growing number of countries and regions and are typically the most economic solution for new grid-connected capacity where good resources are available.
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