IELTS Reading Practice: Renewable Energy’s Impact on Electricity Costs

The IELTS Reading section tests your ability to understand complex texts and answer various question types. Today, we’ll focus on a topic that has been increasingly prevalent in recent years: renewable energy’s impact on electricity costs. This subject has appeared in several past IELTS exams and, given its relevance to global environmental and economic concerns, is likely to feature in future tests as well.

Let’s dive into a practice passage and questions to help you prepare for this type of content in your IELTS Reading test.

Reading Passage

The Economic Implications of Renewable Energy on Electricity Prices

Renewable energy sources have been at the forefront of discussions about sustainable development and climate change mitigation for decades. As countries worldwide strive to reduce their carbon footprint and transition towards cleaner energy sources, the economic implications of this shift have become a topic of intense debate. One of the most pressing questions is how the increased adoption of renewable energy affects electricity costs for consumers and businesses alike.

Historically, renewable energy technologies such as solar panels and wind turbines were significantly more expensive than traditional fossil fuel-based power generation. This led to concerns that a transition to renewables would inevitably result in higher electricity prices. However, recent years have seen a dramatic decline in the cost of renewable technologies, challenging these assumptions and reshaping the energy landscape.

The levelized cost of electricity (LCOE) from renewable sources has plummeted over the past decade. Solar photovoltaic (PV) costs have decreased by 82% since 2010, while onshore wind costs have fallen by 39% during the same period. In many regions, new renewable energy projects are now cost-competitive with, or even cheaper than, new fossil fuel power plants. This trend has led to increased investment in renewable energy infrastructure and a growing share of renewables in the global energy mix.

The impact of renewable energy on electricity costs is complex and varies depending on several factors. In some cases, the integration of renewables has led to lower wholesale electricity prices due to their near-zero marginal costs. This phenomenon, known as the “merit-order effect,” occurs when renewable sources displace more expensive fossil fuel generation in the electricity market, potentially reducing overall system costs.

However, the intermittent nature of some renewable sources, such as solar and wind, presents challenges for grid management and stability. To accommodate these fluctuations, additional investments in grid infrastructure, energy storage systems, and backup power sources are often necessary. These costs can offset some of the savings from cheaper renewable generation and may be reflected in electricity prices.

Moreover, many countries have implemented policies to support the growth of renewable energy, such as feed-in tariffs, renewable portfolio standards, and carbon pricing mechanisms. While these policies have been effective in driving renewable energy adoption, they can also impact electricity prices in the short term. The costs of these support schemes are often passed on to consumers through electricity bills, leading to temporary price increases in some markets.

Despite these challenges, the long-term trend suggests that renewable energy is likely to have a stabilizing effect on electricity prices. As technology continues to improve and economies of scale are realized, the cost of renewable energy is expected to decrease further. Additionally, renewable sources provide a hedge against the volatile prices of fossil fuels, which can fluctuate dramatically based on geopolitical events and market conditions.

The transition to renewable energy also brings indirect economic benefits that may offset potential cost increases. These include reduced air pollution, improved public health outcomes, and the creation of new jobs in the clean energy sector. While these benefits may not be immediately reflected in electricity prices, they contribute to the overall economic value of the renewable energy transition.

In conclusion, the impact of renewable energy on electricity costs is multifaceted and evolving. While short-term challenges and costs associated with the integration of renewables exist, the long-term trend points towards more affordable and stable electricity prices. As the world continues to grapple with the urgent need to address climate change, the role of renewable energy in shaping the future of electricity markets remains a critical area of focus for policymakers, industry leaders, and consumers alike.

Renewable Energy Impact on Electricity Costs

Questions

True/False/Not Given

For questions 1-5, read the following statements and decide if they are True, False, or Not Given based on the information in the passage.

1. Renewable energy technologies were more expensive than fossil fuels in the past.
2. The cost of solar photovoltaic energy has decreased by 39% since 2010.
3. New renewable energy projects are always cheaper than fossil fuel power plants.
4. The intermittent nature of some renewable sources can lead to additional costs for grid management.
5. Carbon pricing mechanisms have been universally successful in lowering electricity prices.

Multiple Choice

Choose the correct letter, A, B, C, or D for questions 6-8.

6. The “merit-order effect” refers to:
   A) The increasing cost of renewable energy over time
   B) The displacement of expensive fossil fuel generation by renewables
   C) The need for more expensive grid infrastructure
   D) The volatility of fossil fuel prices

7. According to the passage, which of the following is NOT mentioned as a potential indirect benefit of renewable energy?
   A) Reduced air pollution
   B) Improved public health outcomes
   C) Creation of new jobs
   D) Increased tourism in renewable energy production areas

8. The long-term trend for electricity prices due to renewable energy adoption is suggested to be:
   A) Consistently increasing
   B) Highly volatile
   C) More stable and potentially lower
   D) Impossible to predict

Matching Headings

Match the following headings to the appropriate paragraphs in the passage. Write the correct number (i-vi) next to questions 9-11.

i. Historical context of renewable energy costs
ii. Challenges in integrating renewable sources
iii. Long-term economic outlook for renewable energy
iv. Policy mechanisms supporting renewable adoption
v. Indirect economic benefits of renewable energy
vi. Recent trends in renewable energy costs

9. Paragraph 3: _____
10. Paragraph 5: _____
11. Paragraph 8: _____

Answer Key

1. True
2. False
3. False
4. True
5. Not Given
6. B
7. D
8. C
9. vi
10. ii
11. v

Explanations

1. True – The passage states, “Historically, renewable energy technologies such as solar panels and wind turbines were significantly more expensive than traditional fossil fuel-based power generation.”

2. False – The passage mentions that solar photovoltaic costs have decreased by 82% since 2010, not 39%. The 39% figure refers to onshore wind costs.

3. False – The passage states that “In many regions, new renewable energy projects are now cost-competitive with, or even cheaper than, new fossil fuel power plants.” This implies that it’s not always the case, but depends on the region.

4. True – The passage mentions, “To accommodate these fluctuations, additional investments in grid infrastructure, energy storage systems, and backup power sources are often necessary.”

5. Not Given – While carbon pricing mechanisms are mentioned as a policy tool, their universal success in lowering electricity prices is not discussed in the passage.

6. B – The passage defines the merit-order effect as occurring “when renewable sources displace more expensive fossil fuel generation in the electricity market.”

7. D – Increased tourism is not mentioned in the passage as an indirect benefit of renewable energy.

8. C – The passage concludes that “the long-term trend points towards more affordable and stable electricity prices.”

9. vi – This paragraph discusses the recent decline in levelized cost of electricity (LCOE) from renewable sources.

10. ii – This paragraph focuses on the challenges of integrating intermittent renewable sources into the grid.

11. v – This paragraph discusses indirect economic benefits such as reduced air pollution, improved public health, and job creation.

Common Mistakes

When tackling a passage like this, students often make the following mistakes:

1. Confusing specific percentages or figures mentioned in the text.
2. Overlooking qualifiers like “many,” “some,” or “often” that indicate the information is not universally applicable.
3. Inferring information that is not explicitly stated in the passage, especially for Not Given questions.
4. Misinterpreting technical terms or concepts unique to the subject matter.
5. Failing to distinguish between short-term and long-term trends mentioned in the passage.

Key Vocabulary

• Renewable energy: Energy from sources that are naturally replenishing, such as wind, solar, and hydroelectric power.
• Levelized cost of electricity (LCOE): The average cost of generating electricity over the lifetime of a power plant.
• Intermittent: Occurring at irregular intervals; not continuous or steady.
• Merit-order effect: The impact on the electricity market when low marginal cost generators (like renewables) displace higher cost generators.
• Feed-in tariff: A policy mechanism designed to accelerate investment in renewable energy technologies.
• Carbon pricing: A method of charging for the emission of carbon dioxide into the atmosphere.

Grammar Focus

Pay attention to the use of comparative and superlative forms in the passage, such as:

• “more expensive than”
• “cheaper than”
• “the most pressing questions”

Also, note the use of present perfect tense to describe recent changes:

• “have plummeted”
• “have fallen”
• “have implemented”

These grammatical structures are common in academic writing and often appear in IELTS Reading passages.

Tips for Success

1. Read the questions before the passage to know what information to look for.
2. Pay close attention to dates, percentages, and specific figures mentioned in the text.
3. Look for qualifying words that indicate the scope or limitations of statements.
4. Practice identifying the main idea of each paragraph to help with matching heading questions.
5. Improve your vocabulary related to energy and economics to better understand similar passages.
6. Time management is crucial – allocate your time wisely between reading and answering questions.

Remember, success in the IELTS Reading section comes with practice and familiarity with various question types. Keep working on your reading speed and comprehension skills, and you’ll see improvement in your performance.