future costs of electricity generation
Figure 6.89 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, electricity generation costs will become economically favourable under the Energy [R]evolution Scenario and by 2050 will be more than 4.5 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, a massive growth in demand, increased fossil fuel prices and the cost of CO2 emissions result in total electricity supply costs rising from today’s $64 billion per year to more than $930 bn in 2050. Figure 6.90 shows that the Energy [R]evolution Scenario not only complies with India’s CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting energy supply to renewables leads to long term costs that are one third lower than in the Reference Scenario.