Oxford: Shift to Clean Energy Could Save Trillions

September 22, 2022

Yale e360:

The world would save at least $12 trillion by phasing out fossil fuels and shifting to renewable energy by 2050, according to a new analysis from the University of Oxford. 

“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,” Doyne Farmer, an economist at Oxford and co-author of the study, said in a statement. “And, if we accelerate the transition, they will become cheaper faster. Completely replacing fossil fuels with clean energy by 2050 will save us trillions.”

For the study, researchers compared the predictions of leading energy models with data on the actual cost of solar, wind, and battery storage over the last several decades. They found that models have consistently overestimated the future cost of clean energy, with solar costs falling twice as fast as even the most optimistic projections. The swift drop for renewable energy “is different from anything observed in any other energy technologies in the past,” the authors write.

Extrapolating from recent trends, the new study takes a more optimistic view of future clean energy costs. Researchers modeled a scenario in which solar, wind, batteries, electric vehicles, and other green technologies displace fossil fuels by mid-century, with the world using 55 percent more energy than it does today. In that scenario, the shift to increasingly cheap renewable technologies would save upwards of $12 trillion, far more than if countries continue burning fossil fuels past 2050. The findings were published in the journal Joule.

“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,” Rupert Way, a postdoctoral researcher at Oxford and lead author of the study, said in a statement. “Accelerating the transition to renewable energy is now the best bet not just for the planet, but for energy costs too.”

Yale e360 has done a good job of knocking down some of the myths about renewables, as here.

Yale e360:

Myth No. 1: A grid that increasingly relies on renewable energy is an unreliable grid.

Going by the cliché, “In God we trust; all others bring data,” it’s worth looking at the statistics on grid reliability in countries with high levels of renewables. The indicator most often used to describe grid reliability is the average power outage duration experienced by each customer in a year, a metric known by the tongue-tying name of “System Average Interruption Duration Index” (SAIDI). Based on this metric, Germany — where renewables supply nearly half of the country’s electricity — boasts a grid that is one of the most reliable in Europe and the world. In 2020, SAIDI was just 0.25 hours in Germany. Only Liechtenstein (0.08 hours), and Finland and Switzerland (0.2 hours), did better in Europe, where 2020 electricity generation was 38 percent renewable (ahead of the world’s 29 percent). Countries like France (0.35 hours) and Sweden (0.61 hours) — both far more reliant on nuclear power — did worse, for various reasons.

The United States, where renewable energy and nuclear power each provide roughly 20 percent of electricity, had five times Germany’s outage rate — 1.28 hours in 2020. Since 2006, Germany’s renewable share of electricity generation has nearly quadrupled, while its power outage rate was nearly halved. Similarly, the Texas grid became more stable as its wind capacity sextupled from 2007 to 2020. Today, Texas generates more wind power — about a fifth of its total electricity — than any other state in the U.S.

Myth No. 2: Countries like Germany must continue to rely on fossil fuels to stabilize the grid and back up variable wind and solar power.

Again, the official data say otherwise. Between 2010 — the year before the Fukushima nuclear accident in Japan — and 2020, Germany’s generation from fossil fuels declined by 130.9 terawatt-hours and nuclear generation by 76.3 terawatt hours. These were more than offset by increased generation from renewables (149.5 terawatt hours) and energy savings that decreased consumption by 38 terawatt hours in 2019, before the pandemic cut economic activity, too. By 2020, Germany’s greenhouse gas emissions had declined by 42.3 percent below its 1990 levels, beating the target of 40 percent set in 2007. Emissions of carbon dioxide from just the power sector declined from 315 million tons in 2010 to 185 million tons in 2020.

So as the percentage of electricity generated by renewables in Germany steadily grew, its grid reliability improved, and its coal burning and greenhouse gas emissions substantially decreased.

2 Responses to “Oxford: Shift to Clean Energy Could Save Trillions”

  1. John Oneill Says:

    ‘Similarly, the Texas grid became more stable as its wind capacity sextupled from 2007 to 2020.’…until it hit the major blackout of 2021. True, it was mostly from gas wells freezing (or gas being priced off the power market by heating demand), but the near total unavailability of forty gigawatts of wind and solar sure didn’t help. Or does that not count ? ‘Power outages caused by natural disasters and weather are increasing, according to Germany’s Federal Office of Civil Protection and Disaster Assistance, but are not included in the calculations for the SAIDI.’
    Germany has reduced its power emissions, but they’re still above the OECD average – 38% higher than those of the UK over the last year, and 300% higher than those of France. Britain was getting more of its power from coal in 1990 than Germany was – largely because Germany was getting about 33% from nuclear, and Britain only about 20%. Now France and the UK have almost eliminated coal use (or had till the recent crisis), while Germany was still 34% reliant on coal, and 10% on gas. Italy, which exited nuclear long before Germany, and at one stage had the highest percentage of its electricity from solar in the world, is also still reliant on coal, and heavily dependent on imports, mostly from France.
    https://edecarb.org/countries/germany

  2. John Oneill Says:

    System costs – Western Australia will have to spend 9 billion dollars over the next five years to upgrade the grid to cope with renewables. https://www.abc.net.au/news/2022-09-25/billion-dollar-shock-as-grid-renewal-costs-become-clear/101469176


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