Wind and solar energy can’t make fossil fuels obsolete by themselves, but they can with the help of cheap energy storage.
Wind and solar energy have long been marginal players compared to fossil fuels, but that’s beginning to change. In the last few years the costs to build both wind and solar power plants have fallen far enough that on a per unit of energy basis they can compete with any fossil fuel. And they beat oil, coal, and nuclear in most locations.
Newly leaked bids for energy contracts for Xcel Energy‘s (NASDAQ:XEL) 2017 All-Source Solicitation show that wind and solar are not only competitive, they’re dominant when combined with energy storage. Adding storage to renewable energy plants allows the utility to control when energy is dispatched to the grid, reducing or eliminating the variability that’s inherent with wind and solar energy. This is a game-changer for utilities, renewable energy companies, and investors worldwide, and could begin to spell the end for fossil fuels.