Appendix 4 presents the methodology for developing long-term cost projections for energy technologies, supporting planning and scenario analysis for milestones such as 2030, 2040, and 2050. The objective is to provide a consistent framework for estimating cost evolution over time, reflecting both technological progress and real-world deployment conditions.

The methodology begins with defining a base year (2025), which serves as the reference point for all projections. Cost data for this year are based on actual data and existing studies, ensuring an accurate representation of current technology status. Future values are then derived using structured assumptions.

A key element of the methodology is the learning curve, which represents the relationship between cost and cumulative deployment. As technologies are deployed more widely, costs tend to decrease due to technical improvements, process optimization, and economies of scale. The appendix applies specific learning rates combined with deployment scenarios to project future cost trends.

The methodology also considers technology maturity, distinguishing between commercially established technologies and those still under development. This is important because emerging technologies typically have greater cost reduction potential but also higher uncertainty.

To reflect uncertainty, the appendix introduces uncertainty ranges for cost projections. These ranges are derived by combining current cost data with uncertainty factors related to deployment speed and future learning effects. This allows users to understand not only central estimates but also possible variation ranges.

Finally, the methodology is informed by international energy scenarios (such as those in the World Energy Outlook), which help define future deployment levels and directly influence cost reduction trajectories. This ensures that cost projections are grounded not only in technical assumptions but also in the broader global energy system context.