Invest in low-CO2 tech not gas, says CCC

24th May 2013


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  • Energy ,
  • Conventional ,
  • Mitigation



Investing in low-carbon technologies could save consumers at least £25 billion, whereas pouring money into gas-fired generation would only produce significant savings if the world abandons attempts to limit global warming.

A new report from the committee on climate change (CCC) on the government’s electricity market reform (EMR) reveals that there are significant economic benefits from investing in a portfolio of low-carbon technologies over the next two decades rather than investing in gas-fired generation.

The committee says the financial gains will only materialise if the government takes action now to relieve the uncertainty that currently surrounds the UK power system beyond 2020, and which threatens to undermine the EMR and its measures to support the transition to a low-carbon power sector.

Introducing legislation now to reduce 2030 carbon intensity of power generation to 50gCO2/kWh can diminish uncertainty, says the CCC. “Industry has been clear that this would provide them with the confidence that they need to invest large amounts of money in project development and the supply chain.”

The analysis by the CCC reveals that allocating financial resources to gas-fired generation through the 2020s and delaying investment in low-carbon technologies to the 2030s would not be a sensible option, and is likely to drive up costs.

According the CCC, potential savings from investing in low-carbon generation could be as high as £100 billion if gas and carbon prices escalate. The study factors in the likely impact on prices of unconventional sources of fossil fuels, such as shale gas.

The committee acknowledges that shale gas could play a role in the future gas mix, helping to balance intermittent power generation and meet demand for heat, but only if appropriate environmental safeguards are put in place.

“This report shows that there are significant benefits and very limited risks from investing in low-carbon technologies,” commented Lord Deben, chair of the CCC.

“It factors in the potential benefits of shale gas, which could play a useful role in meeting heat demand. It shows that the cost-effective route to the 2050 target involves investment in a portfolio of low-carbon technologies in the 2020s.”


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