The cost of green energy like wind and solar has been falling for decades.
Study on Renewable Energy:
An Oxford University study says renewable energy could save $12tn (£10.2tn) by 2050. Moving quickly to cleaner energy sources is not expensive, the report said. Rising oil prices have pushed up gas prices.
Researchers say going green makes economic sense due to falling renewable costs.
Prof. Doyne Farmer from the Oxford Martin School’s Institute for New Economic Thinking said, “Even if you are a climate denier, you should be on board with what we’re advocating. The green energy transition will save us money, so we should go all out,” he said.
The report’s findings are based on modeling historical price data for renewable energy and fossil fuels.
After accounting for inflation and market volatility, fossil fuel prices haven’t changed much since 2020. Renewables are new, so there’s less data. In that time, technology improvements have lowered the cost of solar and wind power by 10% a year. The report expects the price of renewables to fall based on “probabilistic” modeling, using data on how massive investment and economies of scale have made similar technologies cheaper.
“Our latest research shows scaling up key green technologies will continue to drive down their costs,” says Dr. Rupert Way from the Smith School of Enterprise and the Environment.
Wind and solar are the cheapest options for new power projects, but questions remain about how to store power and balance the grid when weather changes reduce renewable energy output.
Zero-cost
In 2019, then-Chancellor Philip Hammond wrote to the prime minister that reaching net zero greenhouse gas emissions by 2050 in the UK would cost more than £1tn. This report says overestimated costs discouraged investment.
It also says IPCC predictions that keeping global temperature rises below 2 degrees would cost GDP by 2050 were too pessimistic. The switch to renewables would be “net economically beneficial,” it says.
The research 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 Oxford, and SoDa Labs at Monash University.
