World Energy Resources | 2016

WORLD ENERGY COUNCIL | WORLD ENERGY RESO URCES 2016
has seen a significant cost decline since its championing in early 1980s by Denmark and
United States. Globally weighted average investment costs declined from 4,766 US$/kW in
1983 to 1,623 US$/kW in 2014, translating into an overall reduction of 66%. A learning rate
of 6% fits the investment costs evolution. Thus, every time global cumulative installed
capacity doubled, investment costs declined by 6%. The LCOE of onshore wind power
experienced a higher rate of decline in comparison to investment costs to calculate the
LCOE of onshore wind, so it was assumed a constant weighted average cost of capital of
7.5% for OECD countries and China, and 10% for the rest of the world. Globally, the
weighted average LCOE of onshore wind declined from 0.38 US$/kWh in 1983 to 0.07
US$/kWh in 2014. Thus, the LCOE of onshore wind was 81% lower in 2014 in comparison
to the estimated value in 1983. This represents a learning curve of 9%. The learning rate of
LCOE is higher than the one estimated for investment costs because technological
improvements allowed for lower investment costs and higher capacity factors at the same
time. Additionally, lower Operation & Maintenance costs for higher rated wind turbines have
helped to bring down the LCOE of onshore wind.
FIGURE 8: IRENA ONSHORE WIND LEARNING RATE
Source: IRENA Renewable Cost Database
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