This year's report (page 20) provides further confirmation of a trend that has been apparent for several years. The cost of generating electricity from onshore wind continues to fall, and, in the right conditions, can now compete with all but the cheapest - and often the dirtiest - fossil-fuel generators while comfortably undercutting nuclear. Solar PV costs are falling faster than onshore wind's, but are not expected to come in cheaper for at least ten years.
The message is clear. Countries that are serious about cutting carbon emissions from their electricity production simply have to consider onshore wind power as part of their energy mix. The economic case is becoming unarguable.
Regrettably, the same cannot yet be said for offshore wind. Costs continued to rise in 2014, probably due to the growing number of deep-water, far-from-shore projects in construction, and the cost and time overruns of earlier projects only now being fed into the data sources. The potential is there for big cost-cutting as a new generation of supersize turbines comes online, but it remains some way from being realised.
Overshadowing the incremental drop in onshore wind costs, however, has been the plummeting in price of crude oil, from around $115 a barrel last June to less than $50 at the time of writing. The price of oil has only a marginal effect on electricity generation costs, but if it continues to stay low for the next year or two there will be spin-off impacts across the energy industry as a whole that are hard to predict.
Boom and bust
In the short term at least, wind should profit. Cheaper oil means reduced manufacturing and transportation costs. But the depressed price will make oil extraction uneconomic in many parts of the world. Already, several of the companies active in Europe's North Sea oil industry have cut production and jobs. How long the US's oil-fracking industry can keep going with prices below $50 a barrel is another question. Some economists are comparing the current state of this market with the "dotcom" bubble of the late 1990s. If it bursts in the same way, it will not only take down the extraction companies, but many of the investors too. The western world's banking system has not yet fully recovered from the financial crisis of 2007-08. How will it stand up to another seismic shock?
The real problem here is not so much price as volatility. Energy generation is a long-term business; producers have to plan ahead in decades rather than years, balancing security of supply with costs consumers can afford. That's hard to do when the price of such a fundamental commodity as oil peaks and troughs.
Wind power is providing a stable and predictable alternative to fossil-fuel energy generation. Its costs are competitive now, and still falling. Today's turbines are more efficient than their predecessors and are being built to last 30 years. Wind may not offer the get-rich-quick returns of the shale oil and gas fracking industry, but it looks a much safer bet in the long run.
Shaun Campbell is features editor of Windpower Monthly