Good news for the environment: renewable energy is getting cheaper, and so is the technology for storing energy produced by those renewable sources.

Lazard recently released its annual Levelized Cost of Energy report, along with its fourth annual Levelized Cost of Storage report. In it, the company revealed that across most use cases and technologies, there have been significant cost declines, particularly in the case of shorter-duration applications.

In some cases, alternative energy costs have decreased to the point that they are now at or below the marginal cost of conventional generation. For example, the low-end levelized cost of onshore wind-generated energy is $29 per megawatt hour, compared to an average marginal cost for coal of $36 per megawatt hour.

The cost of generating energy from utility-scale solar and onshore wind technologies is down 13 percent from last year, and the mean levelized cost of energy of onshore wind has declined almost 7 percent. The levelized cost of utility-scale solar is nearly identical to the marginal cost of coal—a comparison which is accentuated when subsidizing onshore wind and solar, which resulted in levelized energy costs of $14 per megawatt hour for wind and $32 per megawatt hour for solar.

While alternative energy is becoming extremely cost-competitive and there’s a lot of promise in current storage technology, Lazard said that for the foreseeable future, alternative energy systems alone will not be capable of meeting the baseload generation needs of a developed economy. They suggested that for now, the optimal solution for many regions in the world will be to use complementary conventional and alternative energy resources.

“Although diversified energy resources are still required for a modern grid, we have reached an inflection point where, in some cases, it is more cost effective to build and operate new alternative energy projects than to maintain existing conventional generation plants,” said George Bilicic, vice chairman and global head of Lazard’s Power, Energy & Infrastructure Group. “As alternative energy costs continue to decline, storage remains the key to solving the problem of intermittency and we are beginning to see a clearer path forward for economic viability in storage technologies.”

When it comes to storage technologies, the Localized Cost of Storage report stated that lithium-ion remains the least expensive of the storage technologies and continues to decrease in cost due to improved efficiencies. However, Lazard warned that some of these gains may be offset by higher pricing of cobalt and lithium carbonate, commodities crucial to manufacturing lithium-ion storage products.

Technology-specific cost decline projections vary widely, but are expected to be as much as 28 percent for lithium-ion technologies over the next five years.

Lazard’s Global Power, Energy & Infrastructure Group serves private and public sector clients with advisory services regarding mergers and acquisitions, financing, and other strategic matters. The group is active in all areas of the traditional and alternative energy industries, including regulated utilities, independent power producers, renewable energy, and infrastructure.

To read the full Levelized Cost of Energy and Levelized Cost of Storage reports, visit Lazard’s website.