The low carbon path is cheaper in the long run Report “Energy Darwinism II” shows why
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A recent report published by Citigroup US examines the likely costs of different energy sources. Findings in the report forecast that the funds to be spent on energy (both capital expenditure and fuel) over the next quarter century will be unimaginably large, at around US$200 trillion. The energy industry is faced with choices, and the report outlines two scenarios: 1) a business as usual or 'inaction' on climate change scenario, and 2) a different energy mix that offers a lower carbon alternative.
The report concludes that for the ‘inaction’ scenario until 2040, the levels of expenditure remain remarkably similar, whereas the 'action' scenario actually results in a saving of US$1.8 trillion over the same period. While in the latter scenario more is spent in the early years on renewables and energy efficiency, the savings in fuel costs in later years offset earlier investment.
These findings are of particular importance in view of the UN COP21 meeting in Paris in December 2015 where delegates will once again try to reach a global legally binding agreement designed to keep global temperature increases below 2°C.
The full report is available for download on: