I recently presented a new analysis that depicts the potential cost and scale of emissions reductions across around two dozen mitigation measures. The tool, called a Marginal Abatement Cost Curve (MACC), gives a simple visual snapshot of the relative value of different measures in Ireland’s pathway to climate neutrality, assessing their cost and total impact on reducing emissions. It includes measures across all aspects of Ireland’s energy system (transport, heating, industry and power supply), and land use (such as livestock and forestry).
The MACC comes from a collaboration between two modelling teams, the Times-Ireland Model (TIM) developed by my group at University College Cork, which explores long-term scenarios for Ireland’s energy system, and Goblin, developed at the University of Galway, which examines emissions from future scenarios of agriculture and land use. Modelling studies like this are not forecasts or policy prescriptions, and should always be treated with caution. Results depend on critical input assumptions about the future, all of which are uncertain, as well as choices made within the model framework.
Nevertheless, clear and useful insights emerge from the study.
The first and most striking is that decarbonisation is largely cost-effective, and in many cases can deliver very large cost savings. In the “climate neutral ambition” scenario, which depicts a pathway for cutting emissions deeply and quickly across all sectors, around half of emissions reductions can be achieved at a net saving. These savings are mainly delivered by onshore and offshore wind energy and the electrification of cars and trucks, which dramatically cut Ireland’s fossil fuel dependence.
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A further 40 per cent of emissions savings can be achieved at a relatively low cost – less than €80 per tonne of carbon dioxide saved. This is below the financial penalties that Ireland is likely to face for missing EU Effort Sharing Regulation targets, as estimated by the Irish Fiscal Advisory and Climate Advisory Councils. Several land use measures fall into this category, including afforestation and diversification away from the least productive and least profitable livestock systems. If beef and dairy prices are lower in the future, diversification makes even greater financial sense.
Similarly, if fossil fuel prices remain high into the future, energy transition measures will deliver even greater financial savings.
Relative costs and savings will always depend on uncertain future fuel, electricity, beef and dairy prices. But the broad conclusion is robust. Inaction is the expensive option. Delay does not save money; it transfers money to fossil fuel imports, future compliance costs and more expensive mitigation later.
A second insight is that a shortlist of actions does most of the heavy lifting. Actions in power, transport, agriculture and land use account for 90 per cent of total mitigation. Of these, offshore wind is the single most important measure. Every month of delay in getting this industry off the ground will mean higher fossil fuel costs and emissions. Similarly, transport electrification accounts for nearly one quarter of emissions reductions.
To achieve these savings, the barriers are generally not technological or economic. Rather, they relate to the practical challenges of delivery, such as charging infrastructure for road transport electrification. Ireland’s challenge is not a lack of options, strategy, or cost-effective measures, but delivery at speed and scale.
Just because a measure is cost-saving, it doesn’t automatically mean it is easy to deliver, or can be left to the market. Many of our energy, transport and land-use systems, including their infrastructure and institutions that govern them, are characterised by inertia and lock-in. Transforming them requires sustained public investment, long-term policy certainty and capable institutions. Finance is also a barrier. The transition to an electrified, renewable and efficient energy system will lead to cost savings in the long-term, but savings can only be realised with huge upfront capital investment.
Conversely, higher-cost measures do not necessarily imply lower value. Retrofitting buildings and installing heat pumps appear relatively expensive compared with many other mitigation options. Yet these investments address energy poverty, improve comfort, reduce households’ exposure to volatile fossil fuel prices, improve energy security and deliver health benefits that are not captured in a simple cost-per-tonne metric.
The MACC analysis also doesn’t include some measures that are clearly important for achieving climate goals, particularly those related to energy demand, such as public transport, active travel, and managing the growth of energy demand from data centres. These were omitted because of model and data limitations, not because they’re unimportant.
An important lesson from the exercise is how little has changed over time. The first Irish MACC helped inform the first climate action plan in 2019. It similarly showed that significant emissions and cost savings can be delivered by renewables and clean energy measures. The economics of vehicle electrification and agricultural diversification have only improved.
We have spent years debating whether climate action is affordable. The evidence has been pointing in the same direction for much of the last decade.
- Prof Hannah Daly is professor of Sustainable Energy at University College Cork
