The world could produce 95 per cent of the electricity it needs from renewable sources by 2050, cutting greenhouse emissions from the energy and transport sectors by 80 per cent without jeopardising economic growth.
That is the conclusion of a new 260-page report from a coalition of environmental groups that has been orchestrated by Greenpeace. It aims to show that it is economically and technically feasible to cut global greenhouse gas emissions in line with the latest recommendations from climate scientists.
The report, entitled Energy [R]evolution – a sustainable energy outlook, estimates that the transition towards a low-carbon energy infrastructure would require total investments worth $18tn (£12.4tn) by 2030, equivalent to almost five times the US federal budget for 2011.
However, report lead author Sven Teske said that the price was affordable and would deliver net economic benefits over the next two decades.
"Under the business-as-usual scenario set out by the International Energy Agency we are going to have to invest at least $11.3tn in energy infrastructure by 2030," he explained. "And the extra money needed for our scenario can be entirely financed through fuel cost savings – $18tn sounds like a lot, but if you look at the investment that will be required anyway, it is not that much extra."
Teske said that under the report's scenario, renewable energy would also be able to compete on price with fossil fuel-based energy by 2020. "The only reason renewable energy is more expensive is that at the moment it is more labour intensive than fossil fuels," he explained, adding that increased investment would create six million new renewable energy jobs by 2020 while ultimately leading to much lower energy prices.
Encouragingly, the report suggests the global transition towards renewable energy can be delivered using policy mechanisms that have already been deployed in many countries, including feed-in tariffs, energy efficiency standards, smart grid rollouts, carbon pricing mechanisms and the phasing out of fossil fuel subsidies.
Teske said that under the report's scenario an international agreement would result in industrialised countries helping to fund feed-in tariffs in developing countries to accelerate the global rollout of renewables.
"The scenario mapped out in the report is entirely feasible," he added. "We have not proposed cutting energy demand by curbing economic growth, everything is based on the IEA's economic growth figures and its somewhat conservative projections for fuel costs."
Teske also predicted energy utilities would have to adapt their business models to cope with the shift towards renewable energy. "Utilities will have to change to support decentralised power supplies," he warned. "More and more customers are generating their own energy or developers are building wind farms and selling the energy direct to customers. The utilities need to adapt fast as the market is already changing."
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