The climate change emergency has led many to turn towards alternate forms of energy. However, despite the falling prices of wind and solar power, fossil fuels are still used as the primary source of energy.
Why?
According to a study co-authored by Christopher Knittel, an energy economist at the MIT Sloan School of Management, “Technology-driven cost reductions in fossil fuels will lead us to continue using all the oil, gas, and coal. This will not see any considerable change unless governments pass new taxes on carbon emissions.”
While renewable energy has made promising gains in the last few years, so has fossil fuels. Solar prices might have dropped by two-thirds from 2009 to 2014, but during the same time, new drilling and extraction techniques have made fossil fuels cheaper and markedly increased the amount of oil and gas we can tap into.
In the U.S. alone, oil reserves have expanded by 59 percent between 2000 and 2014, and natural gas reserves have expanded by 94 percent in the same time.
This trend in which cheaper renewable sources of energy are overshadowed by even cheaper fossil fuels can trigger drastic climate problems since fossil fuels are the single biggest factor for the rising temperatures around the world.
In light of this and the catastrophic effect the use of fossil fuels can have on the environment and its people, Knittel supports the much-discussed policy lever of a carbon tax to make up for the disparity in energy costs.
While the policy is still in the works, one compelling reason for it is that fossil fuels impose costs on society that users are not aware of. These include the increased health care costs that result from fossil fuel pollution or the infrastructure costs that are likely to result from rising sea levels.
But, ultimately this is not just about carbon taxes. The way the world is deteriorating, if we really want to curtail the use of fossil fuels, they will be left in the ground.
