(Bloomberg) —

Natural gas’s dominance as power-plant fuel in the US is fading fast as the cost of electricity generated by wind farms and solar projects tumbles, according to Guggenheim Securities.

Utility-scale solar is now about a third cheaper than gas-fired power, while onshore wind is about 44% less expensive, Guggenheim analysts led by Shahriar Pourreza said Monday in a note to clients. 

“Solar and wind now present a deflationary opportunity for electric supply costs,” the analysts said, which “supports the case for economic deployment of renewables across the US.”

Gas prices have surged amid a global supply crunch after Russia’s invasion of Ukraine, while tax-credit extensions and sweeping US climate legislation have brought down the cost of wind and solar. Renewables-heavy utilities like NextEra Energy Inc. and Allete Inc. stand to benefit, and companies that can boost spending on wind and solar will also see faster growth, Guggenheim said.

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