Key results - OECD Europe

Moving from principles to action for energy supply that mitigates against climate change requires a long-term perspective. Energy infrastructure takes time to build up; new energy technologies take time to develop. Policy shifts often also need many years to take effect. In most world regions the transformation from fossil to renewable energies will require additional investment and higher supply costs over about twenty years

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regional results oecd europe future investments in the power sector

future investments in the power sector

It would require about $ 5,400 billion in investment for the Energy [R]evolution scenario to become reality (including investments for replacement after the economic lifetime of the plants) - approximately $ 2,065 billion or $ 52 billion annually more than in the Reference scenario ($ 3,335 billion). Under the Reference version, the levels of investment in conventional power plants add up to almost 35% while approximately 65% would be invested in renewable energy and cogeneration (CHP) until 2050.

Under the Energy [R]evolution scenario, however, OECD Europe would shift almost 96% of the entire investment towards renewables and cogeneration. Until 2030, the fossil fuel share of power sector investment would be focused mainly on CHP plants. The average annual investment in the power sector under the Energy [R]evolution scenario between today and 2050 would be approximately $ 135 billion.

Because renewable energy has no fuel costs, however, the fuel cost savings in the Energy [R]evolution scenario reach a total of $ 4,760 billion up to 2050, or $ 119 billion per year. The total fuel cost savings based on the assumed energy price path therefore would cover 230% of the total additional investments compared to the Reference scenario. These renewable energy sources would then go on to produce electricity without any further fuel costs beyond 2050, while the costs for coal and gas will continue to be a burden on national economies.