Rejecting the claims made by the climate change deniers, experts believe that the decarbonising the energy system will save a lot of money.
In an article published by Euronews, it is mentioned that the Oxford University researchers say ending fossil fuel use by 2050 will save the world at least $12 trillion, which disproves the arguments given by the fossil fuel advocates.
Prof Doyne Farmer, who led the study says the findings disprove the fallacy that going green is economically difficult. “There is a pervasive misconception that switching to clean, green energy will be painful, costly and mean sacrifices for us all – but that’s just wrong.”
“Renewable costs have been trending down for decades. They are already cheaper than fossil fuels in many situations, and our research shows they will become cheaper than fossil fuels across almost all applications in the years to come.”
By accelerating this transition, the costs will come down more quickly, he added, as it discourages investors from pouring money into green technologies, and keeps money in environmentally destructive fossil fuels.
The report says the costs of wind and solar power have dropped by around 10 percent a year on average.
This decrease can be attributed to a huge surge in capacity. The production of solar energy has increased by an average of 44 percent a year over the past 30 years, while wind power has increased by 23 percent a year.
This means prices drop sharply. In the 1950s, solar power was as much as 10,000 times more expensive than coal and gas – but it’s now cheaper (though the upfront costs are still more expensive).
Meanwhile the price of fossil fuels – when adjusted for inflation – has not dropped significantly over the past 140 years. Any major changes have been due to geopolitical events like the war in Ukraine. Overall, this means renewables will be cheaper than fossil fuels.
Under the ‘fast transition scenario’ outlined by the scientists, a megawatt hour of solar energy is forecast to cost anywhere from $2 to $40 by 2050 while a barrel of oil will be anywhere from $20 to $110.
HSBC stops funding new oil, gas fields
HSBC – One of the biggest banks in the world – made this announcement earlier which covers those projects that received final approval after the end of 2021.
In its reaction the International Energy Agency described the move as a necessary step if the world is to reach net-zero emissions by 2050.
“HSBC’s announcement sets a new minimum level of ambition for all banks committed to net-zero,” said Jeanne Martin, a campaigner at Share Action.
HSBC joins a small number of other lenders reducing funding for fossil fuels, including NatWest, which cut lending to clients in the oil and gas sector by 21 per cent in 2021.
Earlier this year, Lloyds – Britain’s biggest domestic bank – also barred project financing or reserve-based lending to green-field oil and gas projects. However, the policy still allows general lending to companies in the industry.
Other lenders that have tightened oil and gas policies recently include Dutch bank ING and French lender La Banque Postale.
Also, Barclays said it had increased its sustainable and transition finance target to $1 trillion by 2030 and would pump more of its own money into energy startups.
Covering everything from biomass projects to hydrogen, nuclear and thermal coal – the policy was aimed at driving progress across regions with different energy systems, Celine Herweijer, HSBC’s Chief Sustainability Officer, said.
However, the bank will continue to finance existing oil and gas fields. “It’s not no new fossil fuel investment as of tomorrow. The existing fossil fuel energy system needs to exist hand-in-hand with the growing clean energy system,” Herweijer said.
“The world cannot get to a net-zero energy future without energy companies being at the heart of the transition.”
To ensure oil and gas companies are on-track, the bank would now ask for new information, including production levels beyond 2030, she added.
Over in the United States, political pressure ensures most large lenders continue to finance oil and gas expansion, despite concern from climate campaigners.