The world can save an estimated US$550 billion on the cost of deploying clean energy technologies over the next decade, if countries work together to accelerate innovation by unlocking global collaboration.
Publication date: December 2015
The world can save an estimated US$550 billion on the cost of deploying clean energy technologies over the next decade, putting them on a path to cost competitiveness, if countries work together to accelerate innovation by unlocking global collaboration. This is one of the key findings in this report, United Innovations: cost-competitive clean energy through global collaboration, published by the Carbon Trust, with funding from the UK Foreign and Commonwealth Office Prosperity Fund.
While most of the technologies needed to complete the transition to a low carbon energy system already exist, their costs need to be reduced further and their deployment accelerated to have any chance of meeting 2050 climate change targets. Global collaboration can help on both fronts, but it has proven extremely difficult to generate real momentum for action. The right stakeholders need to be around the table and align priorities and incentives in a way that maximises mutual benefits and minimises risks.
Over the past two decades there have been hundreds of bilateral and multilateral commitments to work together on low carbon technology innovation. Some have delivered successes but the overall impact has been less than expected. In many cases the original intentions behind agreements have been lost and there has been limited implementation, such as joint spending on pilot projects and demonstrations of innovative technologies.
Carbon Trust analysis, based on the International Energy Agency’s Energy Technology Perspectives 2015 2 Degree Scenario, estimates that US$5 trillion will need to be invested into the deployment of low carbon energy technologies by 2025. This cost could be reduced by more than US$550 billion through collaborative innovation. This creates a huge economic opportunity for countries willing to work together strategically on developing new innovations and deploying existing low carbon technologies.
While competition in the private sector remains essential, lack of collaboration between national programmes has resulted in a duplication of efforts and a waste of resources. More significantly, the lack of effective coordination has resulted in a number of hurdles emerging, such as misaligned incentives and contradicting regulatory regimes, which often prevent private sector involvement at scale.