Renewable Power Generation Costs in 2025

For the first time, IRENA’s flagship Renewable Power Generation Costs 2025 report includes a dedicated assessment of ocean energy, reflecting the sector’s growing maturity. It confirms that wave and tidal energy are moving towards commercial deployment on the same cost-reduction pathway as established renewables. Like offshore wind before them, they now need market visibility to unlock investment and reduce costs through scale.

Strengthening energy security with home-grown renewable power
Wave and tidal generate home-grown electricity at different times than wind and solar, strengthening energy security and system resilience. This advantage grows as power systems rely more on variable renewables.

Ocean energy is following a proven path to cost reduction
In Europe, 16 pre-commercial wave and tidal farms, with around 196 MW and 200 devices, are expected to kick-start the sector’s industrial rollout by 2030. IRENA finds that today’s wave and tidal costs are already lower than those of other renewables at the same stage of development. Once 2 GW is deployed, costs are projected to fall to around USD 120/MWh for wave and USD 140/MWh for tidal stream. These figures are based on aggregated learning across several technologies, and single technologies are set to see greater reductions. The drivers are those that transformed offshore wind: innovation, industrialisation, larger projects, economies of scale and lower financing costs.

Vast global market confirms major scale-up opportunities
The report complements Ocean Energy Europe’s recently published Global Resource Assessment, which showed that ocean energy could supply 13% of global electricity demand and 21% of current EU consumption. Together, the two reports show a vast resource with a credible pathway to large-scale deployment.