Renewable energy doesn’t need subsidies to compete with fossil fuels when it comes to building new power plants.
That’s a key takeaway in Lazard’s annual report on electricity generation costs. The investment bank’s report measures the levelized cost of energy for various forms of electricity generation. The report is closely watched, and often criticized, in the energy industry, where it helps guide investment decisions.
This year’s edition, which was released Monday, is notable because it comes as President Donald Trump and congressional Republicans are trying to eliminate tax credits for wind and solar. The political debate is playing out at a time when energy forecasters are projecting a rapid increase in electricity demand due to data centers and artificial intelligence.
Lazard calculates an energy resource’s levelized cost, or LCOE, by dividing a project’s lifetime energy production by its cost. This year’s report concludes that renewables are the “most cost-competitive form of generation,” even without subsidies.
