Study: Using renewable energy might result in trillion-dollar savings

13 Sept 2022

According to a study by Oxford University, switching from fossil fuels to renewable energy might save the world $12 trillion (£10.2 trillion) by 2050.
According to the analysis, saying that switching swiftly to cleaner energy sources was expensive was inaccurate and pessimistic. Increasing worries about the availability of energy have driven higher gas prices. However, the researchers assert that the declining cost of renewable energy means that going green now makes financial sense.
Even if you disagree with what we're advocating, Prof. Doyne Farmer of the Oxford Martin School's Institute for New Economic Thinking told BBC News that you should support it. Our main finding is that we should go forward quickly with the switch to green energy since it will cost us less money, he said.
The report's conclusions are based on a simulation of how prices for fossil and renewable fuels are projected to vary in the future using historical price data. The price hasn't changed significantly after accounting for inflation and market volatility, according to data for fossil fuels that spans more than 100 years from 2020. Less data is available because renewables have only been around for a few decades. But since then, the cost of solar and wind energy has decreased significantly, at a rate close to 10% per year, as a result of ongoing technological advancements.

The report's prediction that the cost of renewable energy would continue to decline is based on "probabilistic" modelling, which makes use of information on how significant investment and economies of scale have reduced the cost of other comparable technologies. According to Dr. Rupert Way, the report's principal author from the Smith School of Enterprise and the Environment, "our most recent research demonstrates scaling-up important green technologies will continue to drive down their prices, and the faster we move, the more we will save."
The least expensive options for new power plants are currently wind and solar, but it's still unclear how to best store energy and balance the grid when weather changes cause a decline in renewable energy output.

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