Accelerating the transition to clean energy technologies can improve energy affordability and ease pressure on the cost of living overall, according to the latest report by the International Energy Agency (IEA) on Thursday.
The report, titled Strategies for Affordable and Fair Clean Energy Transition, demonstrates how increasing investment is necessary to get the world on track to reach net zero emissions by 2050 while simultaneously halving the cost of the energy system globally within the next decade when compared to a trajectory based on current policy settings.
“The net result is a more affordable and fairer energy system for consumers,” the IEA surmised.
According to the report, governments spent around $620 billion subsidizing fossil fuel use last year, far outpacing the $70 billion that was spent on support for consumer-facing clean energy investments.
The agency, therefore, advocated for a faster energy transition to renewable sources such as solar and wind, which have lower operating costs than fossil fuels, to ultimately benefit consumers.
According to the report, by 2035, electricity will overtake oil as the leading fuel source in final consumption.
“In 2022, during the global energy crisis, consumers globally spent nearly $10 trillion on energy—an average of more than $1,200 for every person on earth—even after subsidies and emergency support from governments are priced in,” the report said.
“This is 20% more than the average over the previous five years, with high prices hitting the most vulnerable hardest, both in developing and advanced economies,” it added.
Commenting on the report, IEA Director Fatih Birol said: “The data makes it clear that the quicker you move on clean energy transitions, the more cost-effective it is for governments, businesses and households.”
Birol said that if policymakers and industry leaders put off action and spending, the world will all end up paying more tomorrow.
“The first-of-a-kind global analysis in our new report shows that the way to make energy more affordable for more people is to speed up transitions, not slow them down.”
“But much more needs to be done to help poorer households, communities, and countries get a foothold in the new clean energy economy,” he added.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr