Oxford study shows switch to renewables could save trillions

22nd September 2022


Switching to renewable energy could save the world at least £10.2trn compared to continuing current levels of fossil fuel use, according to a major study.

Empirically grounded technology forecasts and the energy transition, an analysis of energy costs over several decades by Oxford University researchers, says that a fast transition to clean energy would be cheaper than a slow transition or no transition at all, and branded the idea that going green is expensive as “just wrong”. Green technology costs have fallen significantly during the past decade and are likely to continue falling, it adds.

The researchers analysed thousands of transition cost scenarios produced by major energy models and data from 45 years of solar energy costs, 37 years of wind energy costs and 25 years of battery storage costs. They found that the real cost of solar energy dropped twice as fast as the models’ most ambitious projections, revealing that, during the past 20 years, previous models had badly overestimated the future costs of key clean energy technologies versus reality.

The study’s ‘fast transition’ scenario shows a realistic possible future for a fossil-free energy system by around 2050 that provides 55% more energy services globally than today. This would be realised by ramping up solar, wind, batteries, electric vehicles and clean fuels such as green hydrogen.

“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 energy transition and cut reliance on fossil fuels, says Rupert Way, postdoctoral research at the Smith School of Enterprise and the Environment. “But clean energy costs have fallen sharply over the last decade, much faster than those models expected.

“Scaling-up key green technologies will continue to drive their costs down, 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.”

The study shows that the costs for key storage technologies, such as batteries and hydrogen electrolysis, are also likely to fall dramatically. Meanwhile, the costs of nuclear have consistently increased during the past five decades, making it highly unlikely to be cost competitive as renewable and storage costs plunge.

“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,” says Professor Doyne Farmer, who led the team behind the study at the Institute for New Economic Thinking. “Renewable costs have been trending down for decades. They are already cheaper than fossil fuels in many situations, and our research shows they will become cheaper than fossil fuels across almost all applications in the years to come.

“If we accelerate the transition, they will become cheaper faster. Completely replacing fossil fuels with clean energy by 2050 will save us trillions.”

Image credit | iStock

Subscribe

Subscribe to IEMA's newsletters to receive timely articles, expert opinions, event announcements, and much more, directly in your inbox.


Transform articles

UK government unveils 'autumn statement for growth'

Chancellor Jeremy Hunt unveiled the “biggest permanent tax cut in modern British history” in his autumn statement today, as well as significant investment for the net-zero transition.

22nd November 2023

Read more

Despite rising costs and supply chain issues, eight in 10 UK businesses leaders intend to maintain or increase investment in sustainability action over the next two years.

22nd November 2023

Read more

Environmental crimes could result in prison sentences of up to 10 years and company fines of 5% of turnover under a proposed EU law agreed by the European parliament and council.

21st November 2023

Read more

Global temperatures are on track to increase by 3°C above pre-industrial levels this century under current government policies, the UN has warned.

20th November 2023

Read more

Green technologies are driving job growth in the world’s energy sector, but skill shortages are an increasing concern, the International Energy Agency (IEA) has warned.

15th November 2023

Read more

Over 70 environmental organisations in the UK have signed up to a new campaign committing to make the green jobs workforce more diverse and inclusive.

9th November 2023

Read more

More than 40 organisations and businesses have backed IEMA’s campaign to get green skills and training on the agenda at COP28, including Nestle UK, the British Chambers of Commerce, and OVO Energy.

9th November 2023

Read more

Just 1% of the world's largest publicly-listed companies are aligning future capital expenditure with long-term decarbonisation goals, new research has found.

7th November 2023

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert

IEMA Cookie Notice

Clicking the ‘Accept all’ button means you are accepting analytics and third-party cookies. Our website uses necessary cookies which are required in order to make our website work. In addition to these, we use analytics and third-party cookies to optimise site functionality and give you the best possible experience. To control which cookies are set, click ‘Settings’. To learn more about cookies, how we use them on our website and how to change your cookie settings please view our cookie policy.

Manage cookie settings

Our use of cookies

You can learn more detailed information in our cookie policy.

Some cookies are essential, but non-essential cookies help us to improve the experience on our site by providing insights into how the site is being used. To maintain privacy management, this relies on cookie identifiers. Resetting or deleting your browser cookies will reset these preferences.

Essential cookies

These are cookies that are required for the operation of our website. They include, for example, cookies that enable you to log into secure areas of our website.

Analytics cookies

These cookies allow us to recognise and count the number of visitors to our website and to see how visitors move around our website when they are using it. This helps us to improve the way our website works.

Advertising cookies

These cookies allow us to tailor advertising to you based on your interests. If you do not accept these cookies, you will still see adverts, but these will be more generic.

Save and close