Energy Blue Print
Israel 2012

Moving from principles to action for energy supply that mitigates against climate change requires a long-term perspective. Energy infrastructure takes time to build up; new energy technologies take time to develop. Policy shifts often also need many years to take effect. In most world regions the transformation from fossil to renewable energies will require additional investment and higher supply costs over about twenty years

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5.3 future costs of electricity generation

Figure 5.6 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. However, up to 2030, electricity generation costs in the Energy [R]evolution scenario are slightly higher (up to 0.6 € ct/kWh) than in the Reference case. Because of high prices for conventional fuels and the lower CO2 intensity of electricity generation, electricity generation costs will become even more economically favorable under the Energy [R]evolution scenario after 2030, and by 2050 costs will be 2.1 €ct/kWh below those in the Reference version.

Under the Reference scenario, on the other hand, 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 € 6 billion per year to more than € 24 billion in 2050. Figure 5.6 shows that the Energy [R]evolution scenario not only complies with Israel’s CO2 reduction targets, but also helps to stabilise energy costs and relieve the economic pressure on society. Increasing energy efficiency and shifting energy supply to renewables lead to long term costs for electricity supply that are more than 11% lower than in the Reference scenario.