In defence of net zero: yes, we can afford it

Late in 2013, David Cameron snapped. ‘Get rid of all the green crap,’ the then prime minister told energy ministers. His demand came after a backbench revolt over the surcharges tacked on to household energy bills to support onshore wind power. Not for the last time, his decision was based on a spectacular failure to see one of the big trends of the age: the stunning fall in the costs of renewable energy that was already under way.

In the past decade, the cost of generating electricity from onshore wind has fallen by 40 per cent. For offshore turbines, it’s down almost a third. Globally, it’s now generally cheaper to construct and run new renewable generation than it is to build a new station to burn fossil fuels. The cost of solar generation has fallen even faster than wind: the price of a solar photovoltaic module has almost halved since 2010.

The collapse in the cost of renewable energy generation is one of the great untold stories in recent years. It’s also one of several good reasons to doubt those who confidently forecast that net zero will be an expensive disaster.

Many of the same people once insisted wind power had no economic future and Britain should bet on coal. Last year, renewables provided more than 40 per cent of UK electricity, more than fossil fuels; the UK will stop burning coal for electricity in 2024.

What happened? In short, markets. Markets create incentives: sell something more cheaply and you’ll sell more, and make more money. Growing demand for renewable energy created incentives for industry to innovate and cut the costs. All the forecasts of the costs of moving to green heating and electric cars will be wrong.