Benchmarking VRE cost assumptions with awarded renewable energy auctions - A comparative assessment of global energy scenarios

Abstract

Wind and solar power play a pivotal role in deep decarbonization pathways. However, energy scenario studies differ substantially in the absolute and relative contribution of these technologies, as the technology choice in model assessments depends strongly on the choice of certain techno-economic parameters. In this presentation we systematically compare cost assumptions for variable renewable energy sources (VRE) in global energy scenarios with recent remuneration levels determined via market-based auction mechanisms. Our results indicate that the rapid cost decline of renewables has been structurally underestimated and suggest that many current studies refer to obsolete or very conservative literature values and status-quo bias, potentially significantly underestimating future deployment levels of VRE and their decarbonization potentials.