Renewables are So Cheap They Need Lots of Subsidies – Watts Up With That?

Essay by Eric Worrall

Watch out for big oil saboteurs, who are more interested in pumping oil than making money.

AUGUST 20, 2025

Inflexion Point: Renewable Energy Is Cheaper Than Fossil Fuels

PRABIR PURKAYASTHA

The tipping point between renewable energy and fossil fuels has been reached, says a new United Nations (UN) report. The UN Secretary-General Antônio Guterres said that we are entering a renewable era and leaving the era of fossil fuels. According to the report, ‘In 2024, renewables made up 92.5% of all new electricity capacity additions and 74% of electricity generation growth’. While almost the entire world has increasingly switched to renewables, the United States stands out as the sole ‘dissident’, with the Trump administration denying climate change and still backing fossil fuels.

…

The long-talked-about renewable transition is finally here! The question is, do we have the political will to do what is not only necessary in climate terms but also economically a better option for all of us? Or will the old fossil lobby, particularly in the US, sabotage humanity’s transition to a low-carbon future?

…

Not surprisingly, an analysis—Li, M., Trencher, G., & Asuka, J., Feb 16, 2022, PLOS ONE —of their business activities shows, ‘a continuing business model dependence on fossil fuels…We thus conclude that the transition to clean energy business models is not occurring, since the magnitude of investments and actions does not match discourse’. In other words, oil companies are continuing with their business as usual under the cloak of carbon capture, grey hydrogen, etc., along with a lot of hot air. Incidentally, these four companies alone are responsible for 10% of all global warming in the world since 1965.

…

The only country acting as the spoiler is the United States, which, though it is no longer competitive in manufacturing, believes that it can extract ‘rent’ from others. This is the new G1’s ‘Trump-based world order’, instead of the G7’s so-called ‘rule-based world order’.

Read more: https://www.counterpunch.org/2025/08/20/inflexion-point-renewable-energy-is-cheaper-than-fossil-fuels/

What about that cited UN report?

Seizing the moment of opportunity

Supercharging the new energy era of renewables, efficiency, and electrification

…

Executive summary

…

The plummeting costs mean that solar and wind have become the fastest growing sources of electricity in history, and growth in renewable energy is now outpacing that in fossil fuels in the power sector. In 2024, renewables made up 92.5% of all new electricity capacity additions and 74% of electricity generation growth. Between 2015 and 2024, global annual electricity capacity of renewables increased by around 2,600 gigawatts (GW) (140%), while that of fossil fuels increased by around 640 GW (16%). Consequently, the shares of fossil fuels and renewables in global installed electricity capacity now stand at almost 1:1. In terms of global annual electricity generation, renewables increased by 4,470 terawatt- hours (TWh) (81%), while fossil fuels increased by 2,150 TWh (13%). Meanwhile, the sales of EVs have increased by 3,300%, from 0.5 million (1% of all car sales) in 2015 to over 17 million (>20% of all car sales) in 2024. Experts believe that solar, wind, and EVs have irreversibly crossed a positive tipping point and entered a virtuous cycle of cost decline and widespread adoption.

…

Despite this, renewable energy is not replacing fossil fuels in energy systems at the pace and scale needed. To enable all countries to seize the benefits of the emerging clean energy economy, structural barriers and major challenges will need to be overcome. These include: developing enabling policy and regulatory frameworks that provide a level playing field for clean energy; prioritizing modernization and expansion of critical enabling energy infrastructure such as grids and storage; enhancing the resilience and diversity of clean energy supply chains; increasing the availability, accessibility, and affordability of energy-transition finance for developing economies; and addressing political resistance from vested fossil fuel interests

…

Read more: https://www.un.org/sites/un2.un.org/files/un-energy-transition-report_2025.pdf

So let’s see if I have this right.

We have a record breaking tipping point which although on a par with fossil fuel energy production is not replacing fossil fuel, because governments aren’t providing enough “enabling policies” like battery storage, and there is a risk political resistance from oil companies will sabotage the unstoppable renewable revolution because they are more interested in pumping oil than making money.

Riiight.

That seems believable, yes?

I guess it would be rude to ask questions like “if you add the cost of battery storage and grid upgrades and maintenance, are renewables still the cheapest option”? Because if renewables were still the cheapest option when all the enabling infrastructure has been added to the ledger, there would be no need for “enabling policies” and special government “energy-transition finance”.

Related