The deployment of renewables, too slow to save the climate

The International Energy Agency warns that the planned decarbonization will not be achieved at this rate

The world is changing. A new energy economy is emerging. There are more and more electric vehicles, more solar and wind production, and new low-carbon technologies. But the transition to those cleans is being too slow to stop climate change. With the current pace of growth in clean energy, the goal of reducing emissions by 80% by 2050 will not be achieved. Nor will it be possible to keep global warming 1.5°C above pre-industrial levels.

That is the stern warning of the International Energy Agency (IEA), which in its document ‘World Energy Outlook 2021’ (WEO) highlights the need for an “unequivocal signal of ambition and action” from governments.

The IEA’s new analysis offers stark warnings about the direction in which the current policy configuration is taking the world. But it also provides a lucid analysis of how to move forward in a well-managed way to limit global warming to 1.5°C and avoid the worst effects of climate change.

The ‘WEO-2021’, the IEA’s annual flagship publication, shows that although the deployment of clean energy, solar and wind, is going from strength to strength, global coal consumption is growing strongly this year. A circumstance that pushes carbon dioxide (_CO2) emissions to their second highest annual growth in history.

“The world’s enormously encouraging clean energy momentum is colliding with the stubborn presence of fossil fuels in our energy systems,” said Fatih Birol, executive director of the IEA.

“Governments must resolve this, giving a clear and unmistakable signal that they are committed to rapidly adopting the clean and resilient technologies of the future. The social and economic benefits of accelerating clean energy transitions are enormous and the costs of inaction would be immense.”

TWO POSSIBLE SCENARIOS FOR GREEN DEPLOYMENT

In addition to the net-zero emissions scenario for 2050, the ‘WEO-2021’ explores two other scenarios to gain insight into how the global energy sector can develop over the next three decades and what the implications would be.

The so-called ‘Declared Policy Scenario’ represents a path based on the energy and climate measures that governments have implemented to date, as well as on specific policy initiatives that are under development.

In this scenario, almost all the net growth in energy demand until 2050 is met by low-emission sources. But it would leave annual emissions around current levels. As a result, global average temperatures would continue to rise and reach 2.6°C above pre-industrial levels in 2100.

The ‘Announced Promises Scenario’ charts a path in which the net-zero emissions commitments announced by governments so far are implemented on time and in full.

In this scenario, demand for fossil fuels would peak in 2025 and global _CO2 emissions would fall by 40% by 2050. All sectors would experience a decline, especially electricity. The increase in global average temperature in 2100 would then remain at about 2.1°C above pre-industrial levels.

For the first time in a WEO report, oil demand experiences an eventual drop in all scenarios examined, although the timing and speed of the fall vary widely. If all the climate promises announced so far are met, the world would still consume 75 million barrels of oil per day in 2050, up from 100 million today.

In the net-zero emissions scenario, consumption would fall to 25 million barrels by 2050. By contrast, demand for natural gas increases in all scenarios over the next five years, but beyond 2025 there are large divergences.

After decades of growth, the prospects for coal consumption are going downhill in the scenario of promises announced. And the decline could be further accelerated by China’s recent announcement that it is ending its support for the construction of coal plants abroad.

The differences between the results of the announced pledges scenario and the net-zero emissions scenario by 2050 are significant, highlighting “the need for more ambitious commitments for the world to reach net zero by mid-century,” the IEA notes.

“Current climate pledges would result in only 20% of the emissions reductions by 2030 needed to put the world on a path to net zero by 2050,” Birol stressed. “Achieving that path requires investing in clean energy projects and infrastructure more than triple what was planned over the next decade,” he said.

“Approximately 70% of that additional spending needs to be done in emerging and developing economies, where financing is scarce and capital remains up to seven times more expensive than in advanced economies,” Birol added.

INSUFFICIENT INVESTMENTS

Insufficient investment is contributing to uncertainty about the future, the IEA stresses. Spending on oil and natural gas has been reduced by price collapses recorded in 2014-15 and 2020. As a result, everything indicates that demand will stagnate, or even fall. But at the same time, spending on clean energy transitions is “far below what would be required to meet future needs sustainably.”

“There is an imminent risk of further turbulence in global energy markets,” Birol warned. “We are not investing enough to meet future energy needs and uncertainties are heralding a volatile period in the future. The way to address this mismatch is clear: a big boost in investment in clean energy, in all technologies and in all markets. But this must happen quickly,” the IEA executive director said.

The report underlines that the additional investment needed to reach net zero by 2050 is less onerous than it seems. More than 40% of the emission reductions required would come from measures that pay for themselves, such as improving efficiency, limiting gas leaks, or installing wind or solar power in places where they are now the most competitive electricity generation technologies.

In addition, investments in clean and renewable energy also create enormous economic opportunities. Very profitable. “The successful pursuit of net zero would create a market for wind turbines, solar panels, lithium-ion batteries, electrolyzers and fuel cells of more than a trillion dollars a year by 2050, comparable in size to the current oil market,” the Agency notes.

The announced pledges scenario reveals that clean energy and related sectors would employ 13 million workers by 2030, while that number doubles in the net zero emissions scenario by 2050.

A final statement from the IEA: “Transitions to clean energy can offer some refuge to consumers from oil and gas price shocks.”

Source: The Newspaper