The government could halve energy use per person and squeeze out additional energy cost savings if it achieves an optimal approach to slashing emissions by 2050, according to a Carbon Plan the government announced on Thursday.
That would require a mix of electricity generation from nuclear and renewable sources such as wind, biomass and so-called carbon capture and storage plants.
The government said the most cost-effective path to introducing an 80 percent cut in emissions by 2050 would include a mix with 33 gigawatts (GW) of nuclear, 45 GW of renewables and 28 GW of fossil fuels.
Fossil-fuel fired plants would be fitted with carbon capture and storage (CCS) technology to trap exhausts.
The Department of Energy and Climate Change said the most cost-optimal approach to achieving climate targets would trim 84 pounds a year per person off of Britain's cost of energy in the economy, which is seen averaging 4,682 pounds per year.
Chris Huhne, the minister for energy and climate change, said: Every bit of progress we make is one more step away from import dependency, away from price volatility and from the emissions that threaten our way of life.
Our national economic interest is to be found in a cost-effective transition to low carbon, he said.
The Conservative-led coalition has set legally binding targets for greenhouse gas emissions over four five-year periods to 2027, known as carbon budgets. They are designed to put the nation on track towards an 80 percent cut in emissions by 2050.
In June, it set its fourth carbon budget covering the period 2023-2027, which entails an emissions cut of 50 percent from 1990 levels. It plans to review its budgets in 2014.
Parliament's green watchdog, the Environmental Audit Committee, has warned that any loosening of the budget following the 2014 review could jeopardise the 2050 goal.
The UK government has been pressing the 27-nation EU bloc to raise its 2020 climate ambition more in line with Britain's ambitious goal.
The UK's 2020 target is to reduce emissions by 34 percent, and this is legislated by carbon budgets running from 2008-2012, 2013-2017 and 2018-2022.
By contrast, the EU has a binding target to cut emissions 20 percent below 1990 levels by 2020, rising to 30 percent if other nations commit to comparable efforts under a broader climate pact.
Climate negotiators from more than 190 countries are in Durban, South Africa, this week and next to work on a new globally binding United Nations deal aimed at cutting emissions.
(Reporting by Jeff Coelho and Oleg Vukmanovic; editing by Jason Neely)