Historic reductions in the cost of renewable energy are greater than predicted

Essential to understanding the results of the analysis is the emphasis it places on the historic cost reductions in renewable energy (wind/solar + battery) being greater than predicted in most of the analysis models (‘integrated assessment model’) that are used internationally. That the IEA and others have systematically underestimated the reduction in cost of renewable energy in trend projection analyses matches with a range of experiences in the sector.

However, the conclusions drawn in the article are easy to understand

The value of CCS is more stable when it is employed in areas that are less exposed to competition from renewable energy – such as from process-related emissions (i.e. cement works) and carbon negative solutions (BECCS and DACCS). ‘Value’ here means the marginal reduction of societal costs provided by a climate initiative compared with not adopting the initiative. The value of CCS is less stable when CCS is used in combination with fossil fuel-based energy as it is in direct competition with renewable energy – such as gas power with CCS and blue hydrogen production. In these areas, the value of CCS is reduced by between 61% and 96% compared with what the authors believe to be more normal assumptions about the cost development of renewable energy.