Rapid rollout of clean technologies makes energy cheaper, not more costly

Source: IEA50 | · IEA50 · | May 30, 2024

Key task for governments is to make clean energy technologies more accessible to those that may otherwise struggle with the upfront costs, new IEA special report finds

Speeding up the move to clean energy technologies improves the affordability of energy and can relieve pressures on the cost of living more broadly, according to a new IEA special report released today.

The report, Strategies for Affordable and Fair Clean Energy Transitions, shows how putting the world on track to meet net zero emissions by 2050 requires additional investment but also reduces the operating costs of the global energy system by more than half over the next decade compared with a trajectory based on today’s policy settings. The net result is a more affordable and fairer energy system for consumers.

In many cases, clean energy technologies are already more cost competitive over their lifespans than those reliant on conventional fuels like coal, natural gas and oil. Solar PV and wind are the cheapest options for new generation. Even when electric vehicles, including two-and three-wheelers, have higher upfront costs, which is not always the case, they typically result in savings due to lower operating expenses. Energy efficient appliances such as air conditioners provide similar cost benefits over their lifetimes.

However, realising the gains of clean energy transitions hinges on unlocking higher levels of upfront investment. This is especially the case in emerging and developing economies where clean energy investments are lagging due to real or perceived risks that hinder new projects and access to finance.