LONDON: Emissions caused by energy production could peak as early as 2020 and at no economic cost, a new International Energy Agency(IEA) report shows.
Energy-related emissions are a fundamental factor to keeping the increase of global warming under 2 degrees Celsius based on pre-industrial levels, the threshold recognized by the international community to avoid the worst effects of climate change. In fact, such emissions account for two-thirds of global greenhouse gas (GHG) emissions.
“The new IEA World Energy Outlook shows once again that not only can we bend the global CO2 emissions curve without financial burden for the global economy,” says Mark Kenber, CEO,The Climate Group and member of the RE100 steering committe, “but that doing so will spur new economic opportunities and save millions of dollars in future investment costs.
“However, the question is whether governments will show the leadership needed to capitalize on this opportunity and translate it into a new global agreement at COP21 in Paris this December. As the IEA points out, the commitments that governments have made to date through their INDCS still fall short of what is needed. We heard encouraging noises at the recent Bonn climate talks, but much remains to do over the next six months and beyond. Strong policies and measures to further expand investment, drive down technology costs and shift behavior will be the key to unleashing the full potential of the low carbon economy.”
Image: Energy-related CO2 emissions by selected region, from the World Energy Outlook Special Report 2015: Energy and Climate Change by IEA
ENCOURAGING SIGNS
Last year global CO2 emissions stalled while the global economy grew 3%, showing that CO2 emissions and the economy are starting to decouple for the first time in 40 years. In the same year, renewables accounted for almost half of all new power generation created, a clean revolution which is being led by China.
Clean energy investment also rose for the first time in three years in 2014, as technology innovation is continuously driving down the costs of renewables – so much so that solar could be the cheapest source of energy very soon. On top of this, energy intensity of the global economy dropped by 2.3% last year, a figure that is double the average of the last ten years, the IEA reports.
However, based on the Intended Nationally Determined Contributions (INDCs) – climate action plans from countries as part of the Paris agreement– submitted so far, the report shows that even if growth in global energy-related GHG emissions slows, there will be no peak by 2030.
In this scenario, the economy grows by 88% from 2013 to 2030 while energy-related CO2 emissions rise by 8%, reaching 34.8 gigatons (Gt) from 32.2 Gt, with renewables becoming the leading source of electricity by 2030. Still, this pathway will lead to an increase of 2.6 degrees Celsius by 2100 and 3.5 degrees Celsius after 2200.
RAISING AMBITION
To grasp such an opportunity, IEA proposes a ‘Bridge Scenario’ where global energy-related emissions peak by 2020 thanks to the already proven technologies, without changing the economic environment of each country.
To achieve this result, it will be necessary to join a pathway based on five pillars, states the IEA:
- Increasing energy efficiency in the industry, buildings and transport sectors.
- Progressively reducing the use of the least-efficient coal-fired power plants and banning their construction.
- Increasing investment in renewable energy technologies in the power sector from US$270 billion in 2014 to US$400 billion in 2030.
- Gradual phasing out of fossil-fuel subsidies to end-users by 2030.
- Reducing methane emissions in oil and gas production.
Image: Energy-related GHG emissions reduction in CO2-eq terms by policy measure and region in the Bridge Scenario relative to the INDC Scenario 2030, from the World Energy Outlook Special Report 2015: Energy and Climate Change by IEA
Energy efficiency plays a key role in this strategy, accounting for almost half of the emission reductions compared to the INCD scenario. Coal use should peak before 2020 and then decline afterwards, to leave space for a huge increase in renewables use. The report also states that China can decouple economic and emissions growth as early as 2020, if bold energy efficiency measures are set by the government.
However, questions arise on China’s will to implement the drastic shift required to achieve the climate and economic result drafted in the IEA scenario. Even if China is starting to boost renewable energy investments to overcome its coal dependence, the need for the fossil fuel will play a central role in its energy mix at least until 2030, even in the ‘Bridge Scenario’. It will also become the world’s biggest oil consumer to support a 75% increase in electricity demand. Also, the IEA report is in large part based on the implementation on scale of the controversial carbon capture and storage (CCS) technology.
Nevertheless, in all the scenarios global GDP grows on average 3.8% per year from 2013 to 2030, clearly showing a low carbon economy is a prosperous prospective for all. In the ‘Bridge Scenario’ drafted by IEA, cumulative power sector investments to 2030 are US$360 billion lower than in the INDC Scenario. To keep countries on the right pathway, the IEA proposes a five-year revision mechanism to be established – at least in its basic principles – at COP21.
“The challenge is stern, but a credible vision of the long-term decarbonization of the [energy] sector is available to underpin shorter term commitments,” concludes the report, “and the means to realize it can, ultimately, be collectively adopted. The world must quickly learn to live within its means if this generation is to pass it on to the next with a clear conscience.
By Ilario D'Amato