The Challenges in the Transition from Fossil Fuel to Renewable Energy

Unurjargal Nyambuu () and Willi Semmler
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Unurjargal Nyambuu: The New York City College of Technology, The City University of New York

A chapter in Industry 4.0, 2017, pp 157-181 from Springer

Abstract: Abstract As is currently widely discussed, the implementation of climate stability requires a change in energy technologies. There is active ongoing research undertaken on the future of fossil fuel technology, to produce energy, as well as on alternative technologies, such as renewable energy, to provide energy for the future. Fossil fuel has strong externality effects, extensive CO2 emissions, which are largely responsible for triggering global warming in the long run. Yet, those externalities are not incorporated into the cost and price of fossil fuel when currently supplied. Renewable energy exhibits no externality when produced and is of infinite supply; yet, it can only be harvested with some costs. Many countries have already undertaken projects to phase out fossil fuel and to phase in renewable energy. Our paper studies the cost and price trends of fossil versus renewable energy and the effects of those industries’ performance on stock markets. We sketch a growth model that explains the dynamics of how fossil fuel is phased out and renewables are phased in. Finally, we elaborate on how this can be supported by industrial policies, and discuss what employment effects this transition from fossil fuel to renewable energy may have.

Keywords: Renewable energy; Alternative technology; CO2 emissions; Externality (search for similar items in EconPapers)
Date: 2017
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DOI: 10.1007/978-3-319-49604-7_8

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