Renewable energy is now significantly more cost-effective than fossil fuels worldwide, according to the latest report by the International Renewable Energy Agency (Irena) released on Wednesday.
Titled “Renewable Power Generation Costs in 2024”, the report reveals that 91% of all renewable power projects commissioned globally in 2024 produced electricity at a lower cost than any fossil fuel alternative.
However, Irena has cautioned that this progress faces serious challenges in developing and capital-constrained countries like Bangladesh.
Shafiqul Alam, lead energy analyst for Bangladesh at the Institute for Energy Economics and Financial Analysis (IEEFA), said: “Like many other countries, the cost of renewable energy is falling in Bangladesh too. However, the pace of decline is relatively slower. This is mainly due to high land prices, complex acquisition processes, and transmission costs.”
He also said that before the suspension of the Special Power Act, 2010, the latest tariff for utility-scale solar power was $0.0985 per kilowatt-hour.
“If government land can be allocated and transmission costs covered through competitive bidding, the cost could drop further. Special economic zones could also be utilized for implementing utility-scale solar projects,” Alam added.
According to Irena, global renewable power capacity increased by 582 gigawatts in 2024, which helped avoid approximately $57 billion worth of fossil fuel consumption. Costs of solar and wind power generation have dropped substantially worldwide.
Onshore wind was the cheapest renewable source at just $0.034 per kilowatt-hour, while solar PV averaged $ 0.043.
However, Irena warned that several barriers continue to hinder renewable energy progress in the Global South—particularly in Asia, Africa, and Latin America—including weak grid infrastructure, high capital costs, financing limitations, policy uncertainty, and bureaucratic delays.
Shafiqul Alam emphasized that investor reluctance in Bangladesh’s recent tenders signals a lack of confidence. Restoring implementation agreements in tenders could be an effective step toward rebuilding trust.
Irena’s analysis highlights that a large portion of project costs in developing countries stems from interest payments and financing, which drives up electricity prices.
For instance, while average wind power generation costs are similar in Europe and Africa, financing constitutes the major cost component in African projects.
UN Secretary-General António Guterres said: “Clean energy is now smart economics. But unless grid development, administrative reform, and financing are ensured, the renewable revolution will leave developing countries behind.”
Irena director-general Francesco La Camera added: “Renewable energy projects in 2024 helped avoid around $467 billion in fossil fuel costs. But to sustain this success, urgent investments in nance, policy, and infrastructure are needed across the Global South.”
The report also notes that advances in technology have led to a 93% drop in battery storage costs between 2010 and 2024, significantly enhancing the stability and reliability of renewable energy.
Notably, Bangladesh has announced a target of generating 3,000 megawatts of rooftop solar power by 2025.
However, Shafiqul Alam warned that faster progress on the ground is essential to boost investor confidence and secure a sustainable energy future.