future costs of electricity generation
Figure 6.19 shows that the introduction of renewable technologies under the Energy [R]evolution scenario significantly decreases the future costs of electricity generation compared to the Reference scenario. Because of the lower CO2 intensity of electricity generation, costs will become economically favourable under the Energy [R]evolution scenario and by 2050 will be more than 5 $cents/kWh below those in the Reference version.
Under the Reference scenario, on the other hand, unchecked growth in demand, an increase in fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today’s $470 billion per year to more than $1150 billion in 2050. Figure 6.19 shows that the Energy [R]evolution scenario not only complies with OECD North America’s CO2 reduction targets but also helps to stabilise energy costs and relieve the economic pressure on society. Increasing energy efficiency and shifting energy supply to renewables lead to long term costs for electricity supply that are one third lower than in the Reference scenario.
Despite the increased demand for electricity, especially in the transport and industry sectors, the overall supply costs in the advanced version are $62 billion lower in 2030 but $108 billion higher in 2050 than in the basic Energy [R]evolution scenario.