Is There Enough Time to Limit Warming to 2°C? The Cost & Speed of a Renewable Energy Transition

Introduction

At the current rate of global emissions and warming, temperatures are expected to surpass 2°C above pre-industrial levels within this century (Intergovernmental Panel on Climate Change [IPCC], 2018). This short commentary explores the costs and speed of a renewable energy transition that can limit warming from reaching 1.5-2°C. The transformations to achieve this are similar to what is needed for 2°C (IPCC, 2018). As the majority of literature focuses on a 1.5°C limit, this commentary will reflect that, with the idea of 2°C being avoided in the same measures.

Transitioning to Renewable Energy

The 2015 Paris Agreement involved a pledge to limit global warming to well below 2°C relative to pre-industrial temperatures. Despite this agreement, Welsby et al. (2021) found that fossil fuels remain the dominant energy system. To limit warming to 1.5°C by 2050, a decline in fossil fuel use and extraction must take place, meaning nearly 60% of oil/fossil methane gas and 90% of coal sources must remain unextracted. Increasing the use of renewable energy worldwide will likely reduce CO₂ emissions associated with fossil fuels. Renewable energy (e.g., wind, solar, and geothermal) is sustainable, nonpolluting, and found everywhere in the world; it is an important element of a low greenhouse gas energy economy and a feasible alternative to the fossil-fuel-based energy systems used today ((Nelson & Starcher, 2019).

Economic Benefits

Jacobson et al. (2017) assessed 139 countries’ transition to renewable energy and determined that, if we continued with the systems we operate on today, the net global-warming-caused damages are estimated to be $28.5 trillion/year by 2050. Business as usual (BAU) energy systems (fossil fuel systems) have total capital costs of ~$2.7 million/MW; wind, water, and solar (WWS) energy systems have a total capital cost of ~$2.5 million/MW (see Table 1) (Jacobson et al., 2017). The shift from BAU to WWS also involves the avoidance of the social costs of global warming (e.g., costs due to flooding, real-estate damage, agricultural loss, health problems, and wildfires) and the creation of ~24.3 million net new permanent, full-time jobs (Jacobson et al., 2017).

Table 1: Total Capital Cost of Renewable Energy vs. Fossil Fuels

Note. Total capital costs of wind, water, and solar energies (WWS) is compared with the total capital cost of the business as usual (BAU) energy sources such as oil and fossil fuels are compared as well for 2050 (IRENA, 2023).

Wind & Solar Energy

Of the many renewable energy sources, Usher (2019) states that wind and solar energy are the most cost-competitive with BAU energy sources. Wind energy is produced by wind turbines both onshore and offshore, with offshore wind projects experiencing more electricity generated due to steadier wind speeds. Wind energy expenses include the construction of the turbines (the cost of steel) and operating costs (e.g., leasing land and operating projects), with maintenance being the highest cost. The problem with wind energy is that it is considered intermittent, as electricity is only produced when the wind is blowing (Usher, 2019). This problem is where solar energy comes in; when the wind is not blowing, sun energy can be collected. The raw materials needed to produce electricity from light are abundant and inexpensive, and while manufacturing is more costly, there are few operating costs once the panels are installed (Usher, 2019). The costs associated with both wind and solar energy are summarized in Table 2.

As of 2022, the total installation costs of wind energy (both offshore and onshore) amount to USD 4,735/kW, with a levelized cost of energy (LCOE) amounting to USD 0.11/kWh; the total installation cost of solar energy in 2022 was USD 876/kW, and the LCOE was USD 0.05/kWh for solar photovoltaic energy (International Renewable Energy Agency [IRENA], 2023). Capital costs of wind and solar energy sources are compared with the costs of fossil fuel energy sources in Table 2. The electricity needed for a 100% shift to wind and solar power sources by 2050 is noted as well, with solar voltaic energy requiring the most energy of the three at 6.81 TW (“Cost of electricity by source,” 2024).

Table 2: Renewable Energy — Total Costs of Electricity (2022) & Electricity Needed to Shift by 2050

Note. Capital cost estimates for renewable energy technologies are compared to fossil fuel costs (coal, gas) in the first column (“Cost of electricity by source,” 2024).

Conclusion

The transition from fossil fuels to renewables will be critical in avoiding the devastating effects of climate change. Prices of wind and solar energy sources have fallen significantly since 2010 (IRENA, 2023), becoming more competitive with the prices of BAU energy sources each year. Studies have established that this transition may be feasible technically and economically; however, social and political systems are the biggest barriers (Jacobson et al., 2017).

Media Attribution

Figure 1: “DanishWindTurbines” by Leonard G (2004), via Wikimedia Commons, is used under a CC BY-SA 1.0 license.

References

Cost of electricity by source. (2024, April 25). In Wikipedia. https://en.wikipedia.org/w/index.php?title=Cost_of_electricity_by_source&oldid=1220645636.

Intergovernmental Panel on Climate Change. (2018). Global Warming of 1.5 ºC: An IPCC Special Report on the impacts of global warming of 1.5°C above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty. Cambridge University Press. https://doi.org/10.1017/9781009157940.

International Renewable Energy Agency. (2023, August). Renewable power generation costs in 2022. https://www.irena.org/Publications/2023/Aug/Renewable-Power-Generation-Costs-in-2022.

Jacobson M. Z., Delucchi M. A., Bauer Z. A. F., Goodman S. C., Chapman W. E., Cameron M. A., Bozonatt C., Chobadi L., Clonts H. A., Enevoldsen P., Erwin J. R., Fobi S. N., Goldstram O. K., Hennessy E. M., Liu J., Lo J., Meyer C. B., Morris S. B., Moy K. R.,… Yachanin A. S. (2017). 100% clean and renewable wind, water, and sunlight all-sector energy roadmaps for 139 countries of the world. Joule, 1(1), 108–121. https://doi.org/10.1016/j.joule.2017.07.005.

Leonard G. (2004). Danishwindturbines [Image]. Wikimedia Commons. https://commons.wikimedia.org/wiki/File:DanishWindTurbines.jpg.

Nelson, V., & Starcher, K. (2019). Wind Energy: Renewable Energy and the Environment (3rd ed.). CRC Press.

Usher, B. (2019). Renewable energy: A primer for the twenty-first century. Columbia University Press.

Welsby, D., Price, J., Pye, S., & Ekins, P. (2021). Unextractable fossil fuels in a 1.5 °C world. Nature, 597, 230–234. https://doi.org/10.1038/s41586-021-03821-8.