future costs of electricity generation
Figure 6.100 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 lower CO2 intensity in electricity generation, costs will become economically favourable under the Energy [R]evolution Scenario. By 2050 they will be more than 5 cents/kWh below those in the Reference Scenario.
Under the Reference Scenario, 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 $98 billion per year to more than $566 bn in 2050. Figure 6.101 shows that the Energy [R]evolution Scenario not only complies with Developing Asia’s CO2 reduction targets but also helps to stabilise energy costs. Increasing energy efficiency and shifting supply to renewables leads to long term costs that are almost one third lower than in the Reference Scenario.