Estimating the Cost of Future Global Energy Supply

20 Pages Posted: 25 Nov 2012

See all articles by Patrick A. Narbel

Patrick A. Narbel

Norwegian School of Economics (NHH)

Jan Hansen

affiliation not provided to SSRN

Date Written: November 25, 2012


This study produces an attempt to estimate the cost of future global energy supplies. The approach chosen to address this concern relies on a comparative static exercise of estimating the cost of three energy scenarios representing different energy futures. The first scenario, the business as usual scenario predicts the future energy-mix based on the energy plans held by major countries. The second scenario is the renewable energy scenario, where as much of the primary energy supply as possible is replaced by renewable energy by 2050. The cost of the renewable energy generating technologies and their theoretical potential are taken into account in order to create a plausible scenario. The third scenario, the nuclear case, is based on the use of nuclear and renewable energy to replace fossil-fuels by 2050. Endogenous learning rates for each technology were modeled using an innovative approach where the learning rate of a traditional experience curve is diminishing overtime. It results from the analysis that going fully renewable would cost about 10-40% extra compared to a business as usual case. Extensively using nuclear power can greatly this gap in costs.

Keywords: primary energy supply, experience curve, scenario

Suggested Citation

Narbel, Patrick A. and Hansen, Jan, Estimating the Cost of Future Global Energy Supply (November 25, 2012). USAEE Working Paper No. 12-141. Available at SSRN: or

Patrick A. Narbel (Contact Author)

Norwegian School of Economics (NHH) ( email )

Helleveien 30
Bergen, NO-5045

Jan Hansen

affiliation not provided to SSRN ( email )

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