Decarbonising energy system by 2050 could save world $12tn

A new study by the University of Oxford has revealed that transitioning away from fossil fuels could save the world at least $12 trillion.

A common criticism of the climate movement is that decarbonising the energy system is too expensive, but researchers have revealed this isn’t the case.

Published in Joule today, the study led by the Oxford Martin Programme on the Post-Carbon Transition shows a decisive transition to nearly 100% clean energy by 2050 results in lower energy costs.

Other benefits of this move include providing more energy to the global economy and expanding energy access to people across the world.

The results are based purely on the costs of different energy technologies and doesn’t account for the costs related to climate damages and climate adaptation which would be avoided through a clean energy transition.

‘There is a pervasive misconception that switching to clean, green energy will be painful, costly and mean sacrifices for us all – but that’s just wrong,’ said Professor Doyne Farmer, Director of Oxford’s Complexity Economics programme and Professor in the Mathematical Institute. ‘Renewable costs have been trending down for decades. They are already cheaper than fossil fuels in many situations, and our research shows that they will become cheaper than fossil fuels across almost all applications in the years to come. And if we accelerate the transition, they will become cheaper faster. Completely replacing fossil fuels with clean energy by around 2050 will save us trillions.’

The research team used major energy models to analyse thousands of transition cost scenarios and found over 20 years all the models consistently overestimated the future costs of clean technology.

Instead, they discovered that the real cost of solar energy fell twice as fast as the most ambitious projections modelled.

The team then used a more accurate ‘probabilistic model’ to estimate the costs of possible future energy systems based on past data.

They tested the method on historical data for 50 different technologies, including 45 years of solar energy and 37 years of wind energy costs.

The model found that the probability of further costs reductions in green energy is so high the best path forward to push through an energy transition.

 Lead author and Postdoctoral Research Officer, Dr Rupert Way, said: ‘Past models predicting high costs for transitioning to zero carbon energy have deterred companies from investing and made governments nervous about setting policies that will accelerate the green transition and cut reliance on fossil fuels. But past models have overestimated key green technology costs again and again, leaving modellers to play catch up as real world costs plunged over the last decade.

‘Only a few years ago, net zero by 2050 was believed to be so expensive that it was barely considered credible, yet now even the most pessimistic models concede that it’s entirely within reach. Our research goes further and shows that scaling up key green technologies is likely to drive their costs down so far that overall they generate net cost savings, and the faster we go, the more we will save. Accelerating the transition to renewable energy is now the best bet not just for the planet, but for energy costs too.’

Photo by American Public Power Association