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'Governments must invest to cut energy costs'

Published: 22 September 2022 at 09:21

Wind turbines

Director of ARU’s Global Sustainability Institute co-authors major new report

Governments must deliberately use public investment and regulation to rapidly scale-up clean energy technologies to bring down costs, achieve global climate goals and boost economies worldwide, according to a major new report launched today by leading international economists and energy policy experts.

Co-authored by Professor Aled Jones, Director of the Global Sustainability Institute at Anglia Ruskin University (ARU), the report has been produced by the Economics of Energy Innovation and System Transition (EEIST) project, a partnership between world-leading research institutions in the UK, EU, Brazil, China, and India, and is based on a detailed analysis of the last three decades of global energy policy.

The report shows that to replicate the outstanding successes of the energy transition so far, such as offshore wind and solar PV, governments must go beyond simply providing a ‘level playing field’ where technologies are left to compete against each other. 

In fact, contrary to some of the advice given to governments over the past 30 years, the report suggests that governments should proactively use the three levers of policy: investment, tax and regulation, to accelerate innovation and reduce the costs of clean technologies. 

Through real-world case studies, such as the success of offshore wind in the UK and solar power in Brazil, it provides clear evidence of how and where targeted government support for key technologies – which the economic analysis at the time did not recommend – has led to radically accelerated innovation, cost reductions and economic growth, far beyond what would have been achieved with ‘technology neutral’ policies.

The report, Ten Principles for Policymaking in the Energy Transition: Lessons from experience, also recommends that governments should target ‘tipping points’, where clean technologies gain an advantage over fossil fuels, as this can lead to a rapid reallocation of investment, a faster energy transition and lower bills for consumers.  

Based on this body of evidence, the report calls for governments to urgently reshape their policy approaches to accelerate innovation, job-creation, and cost reduction in the transition from fossil fuels to clean energy.

Professor Aled Jones, Director of the Global Sustainability Institute at Anglia Ruskin University (ARU) and one of the three lead authors of the report, said:

“The 10 principles offer a way for policymakers to re-learn their approaches and tackle the big challenges of climate change and the energy crisis.

“In an era where we will see a transformation in energy technologies, which will lower the costs of electricity and create huge opportunities across the world, we need to move beyond our traditional approaches for policy appraisal and modelling. Governments need to be active participants in this transition through investment and regulation to ensure a successful, fast and cheap solution to the climate crisis.”


Laura Diaz Anadon, Professor of Climate Change Policy and Director of the Centre for Environment, Energy and Natural Resource Governance at the University of Cambridge, and one of the lead authors of the report, said:

“Experience with clean energy policy around the world over the past 30 years shows that it is time to reconsider what is required to meet climate and energy goals. Decisive government action is essential, but to succeed it must rely on a different set of policy principles, given the transformational scale of change required.

“Governments cannot simply set the goal and encourage the market to deliver. They must be active participants; investing to de-risk markets, regulating to bring down costs, and making strategic technology choices to incentivise and focus the private sector. Doing so can deliver a transition to clean energy that is faster, cheaper and more sustainable for all.”


The Economics of Energy Innovation and System Transition (EEIST) is a three-year project using new economic approaches to support better decision making on policy relevant to low carbon transitions in the fast-growing emerging economies of China, India and Brazil, as well as the UK and Europe.  

It is funded by the UK Government and the Children's Investment Fund Foundation.

New approaches to policymaking are seen as essential to achieve the goals of the Breakthrough Agenda, the international plan supported by 45 countries to target tipping points in key clean energy technologies by 2030.