“The study shows that investing in green energy will nudge up the cost of electricity in the short to medium term. But will save trillions of Euros in fuel costs alone from 2030 and represents an immediate investment in jobs and energy security.”
The price of fuel imports in 2008 totalled an estimated €350 billion according to the European Commission.
The study presents two scenarios – basic and advanced – both based on existing technologies.
The Basic Energy [R]evolution
Under the basic scenario, Europe will see an 80% cut in CO2 emissions to 1990 levels by 2050.
Nuclear will be phased out.
The Advanced Energy [R]evolution
Under the advanced scenario, EU CO2 emissions will be cut by 95% by 2050.
Nuclear will see a rapid phase out, and coal power plants’ lifetimes will be cut to 20 years. There will be a focus on energy efficiency, electric vehicles, combined heat and power (CHP), smart grids and super grids, solar power and geothermal.
EREC and Greenpeace give a 6-point vision of the advanced scenario:
- Reduce primary energy demand by over a third from the 2007 level of 73,880 PJ/a to 46,030 PJ/a in 2050. The reference scenario would see demand of 75,920 PJ/a.
- Electric vehicles and hydrogen produced from electrolysis. The share of electric vehicles would be 14.6% by 2030 and 62% in 2050. There would also be more public transport.
- Increased use of CHP. CHP would be increasingly based on biomass and natural gas.
- By 2050, 97% of the EU’s electricity would come from renewable energy. Renewable energy capacity of 1520 GW will produce 4110 TWh of renewable electricity per year from 2050. “A significant share of the fluctuating power generation from wind and solar photovoltaics will be used to supply electricity for vehicle batteries and produce hydrogen as a secondary fuel in transport and industry,” the study says.
- Renewable sources will account for 92% of heat supply by 2050 with a particular focus on biomass and geothermal.
- Finally, 92% of final energy demand will be covered by renewable energy by 2050. “To achieve an economically attractive growth of these resources, a balanced and timely mobilisation of all technologies is of great importance. Such mobilisation depends on technical potentials, actual costs, cost reduction potentials and technical maturity,” EREC and Greenpeace say.
Higher investment needed
“The resulting slightly higher electricity generation costs under the advanced Energy [R]evolution scenario will, however, be compensated by reduced requirement for fuels in other sectors such as heating and transport,” the study says.
If implement energy efficiency measures costs on average of €0.03/kWh, the additional cost for electricity supply under the advanced scenario will amount to €82bn per year in 2020 and €73bn per year in 2030.
“By 2050, the annual cost of electricity supply will be €85bn per year below those in the reference scenario,” the report states.
“It would require €3.8 trillion of EU investment to implement the advanced scenario – approximately 90% higher than the reference scenario (€2 trillion).
“The average annual additional investment in the power sector under the advanced Energy [R]evolution between 2007 and 2030 would be approximately €30bn,” the study predicts.
Fuel cost savings
Under the basic scenario, fuel cost savings would amount to €2.1 trillion by 2050, or €49bn per year.
Under the advanced scenario, fuel cost savings would amount to €2.6 trillion by 2050, or €62bn per year.
The advanced scenario would in addition create 1.2 million jobs in the renewable power industry by 2030.
The report calls for governments and decision-makers to implement policies covering the five following topics:
- Develop a vision for a truly sustainable energy economy for 2050 that guides European climate and energy policy. This should include commitment to a final renewable energy system as well as the development of a credible emissions reduction.
- Adopt and implement ambitious targets for emissions reductions, energy savings and renewable energy. Legally binding emission reductions of 30% by 2020, mandatory energy savings targets and the implementation of the 20% renewable energy target as important foundations for energy development in the years to come.
- Remove barriers. The electricity market and network management practices should be subject to a thorough reform. All subsidies and support measures for nuclear power, fossil fuels, inefficient plants, appliances, vehicles and buildings should be removed. Energy prices should reflect the genuine costs of fossil fuel and nuclear energy use.
- Implement effective policies to promote a clean economy. An update of the European Emissions Trading Scheme, the effective implementation of the Renewable Energy Directive and ambitious energy efficiency standards for vehicles, consumer appliances, buildings and power production should be part of a clean energy strategy.
- Redirect public finance. Structural and Cohesion Funds should be re-directed towards renewable energy and energy savings. At the same time, targeted support for innovation and research and energy saving technologies will be essential to hasten the Energy [R]evolution.