Fossil Fuel Cost

The discussion about cost of renewable energy that has gotten some attention lately in Germany is incomplete without looking at the alternatives.

Since no one in Germany proposes reversing the nuclear phase-out, that leaves fossil fuel.

There are basically two possible developments.

One is that fossil fuel prices will continue to rise. In that case getting the transition to renewable done faster will save money.

The other alternative is that fossil fuel prices stay basically at present levels or even go down, as they are doing temporarily in the United States as a consequence of the vile and evil shale gas revolution.

In that case, basic economic theory tells us that more fossil fuel will be burned. Which will lead to even higher costs from global warming.

Getting the transition done fast saves money in both conceivable cases. Braking the transition will not lead to lower prices, it will cost more.

Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

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