As new gas plants become more expensive, renewable energy is still the cheapest way to build power.

Lazard, in a Monday report, said that renewable power sources like solar and onshore winds are the least expensive, and fastest, power generation methods to deploy in the United States. This is true even without any government subsidies.

In its annual Levelized Energy+ analysis, Lazard, an international financial services firm, reported that the cost of building new gas-fired plants has reached a decade high. This is due to the record electricity consumption in the country and the growing backlogs on turbines and equipment required to build the plants.

Why it Matters

After a 20-year hiatus, the U.S. will require many new power plants to meet its rising electricity demand. This is due to the growth of energy-intensive data centres and the electrification in industries such as transportation.

A shift in support of fossil-fired power like coal and gas, over the renewable energy championed by former President Joe Biden, has raised questions about what types of electricity-generating sources will rise to meet the growing demand.

The reliability of the grid and the impact on climate change are affected by different power sources.

By the Numbers

Costs for a utility-scaled solar farm ranged between $38 and $78 per Megawatt Hour, whereas costs for natural gas combined cycles plants were between $48 and $107 per Megawatt Hour. The cost of smaller-scale solar farms and gas peaker plants was much higher.

(source: Reuters)