A new report from Oxford University says switching from fossil fuels to renewable energy sources could save the world as much as $12tn by 2050. The report said that it was too pessimistic to claim that moving quickly towards cleaner energy sources was expensive.
Rising gas prices have been a concern for some time now. But the researchers say that going green now makes economic sense because of the falling cost of renewables.
“Even if you’re a climate denier, you should be on board with what we’re advocating,” Prof Doyne Farmer from the Institute for New Economic Thinking at the Oxford Martin School told BBC News.
“Our central conclusion is that we should go full speed ahead with the green energy transition because it’s going to save us money,” he said.
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The report’s findings are based on an analysis of historic price data for renewables and fossil fuels, which then led researchers to model how these two sources of energy are likely to change in the future.
The data for fossil fuels goes back more than 100 years, and after accounting for inflation, and market volatility, the price hasn’t changed much.
Renewable energy has been around for just a few decades, so there’s less data. However, technological improvements have resulted in rapid cost reductions for solar and wind power—a rate of about 10% per year.
The report’s expectation that the price of renewables will continue to fall is based on data showing that massive investment and economies of scale have made other similar technologies cheaper.
“Our latest research shows scaling-up key green technologies will continue to drive their costs down, and the faster we go, the more we will save,” says Dr Rupert Way, from the Smith School of Enterprise and the Environment.
Wind and solar power are already the cheapest forms of new electricity generation, but the challenge is figuring out how to store that power and balance the grid when there are sudden changes in weather conditions.
Cost of net zero
Back in 2019 Philip Hammond, then Chancellor of the Exchequer wrote to the prime minister to saythat reaching net zero greenhouse gas emissions by 2050 would cost more than £1tn, but a new report contends that this estimate is too high and has discouraged investment in low-carbon technologies.
It also says predictions by the Intergovernmental Panel on Climate Change (IPCC) that the cost of keeping global temperatures rises under 2 degrees would correspond to a loss of GDP by 2050 were too pessimistic. The transition to renewables was, it says, likely to turn out to be a “net economic benefit”.
The research has been published in the journal Joule and is a collaboration between the Institute for New Economic Thinking at the Oxford Martin School, the Oxford Martin Programme on the Post-Carbon Transition, the Smith School of Enterprise & Environment at the University of Oxford, and SoDa Labs at Monash University.
Full article: https://www.bbc.co.uk/news/science-environment-62892013