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This report presents the findings of a study on future energy and carbon costs, based on a review of 13 long-term scenarios for the energy transition
- Coal, oil, gas, electricity, and carbon future prices are included (throughout this report referred to as “energy vectors”)
- Facts and trends impacting future prices are identified, but not analyzed
- EU countries with available information and in different stages of the energy transition are included
The findings can be summarized as follows:
- Most scenarios expect coal prices will remain virtually flat, with yearly price increases that are lower than those of other fossil fuels.
- Oil prices will be affected by limited supply and a decreasing demand. Most scenarios project a moderate growth of oil real prices from 2020 to 2050, except for particular extreme cases.
- Natural gas demand is projected to increase, but price increases will be moderated by abundant global supply. Natural gas demand is projected to increase, but price increases will be moderated by abundant global supply.
- It is expected that end-user electricity prices will rise driven by fossil fuel prices, carbon prices, and increasing generation costs from RES. Industrial electricity prices are projected to increase in the short term and then stabilize towards 2050. Industrial electricity prices rise under scenarios with higher RES
- CO2 prices will increase and will shift the profitability of carbon intensive technologies towards less carbon intensive ones. All considered scenarios project a strong yearly growth of carbon prices . However, there is a wide variation of estimates.
- Coal, oil or gas prices are not correlated with RES penetration.
The above findings are essentially assumptions behind some of the major scenarios using in energy policy planning. The analysis includes scenarios from Ecofys, the European Commission, DNV GL, Greenpeace, Eurelectric, European Climate Foundation, McKinsey, Enerrgynautics, Fraunhofer, Stanford, Imperial College and NERA.