It’s the “greatest challenge humankind has ever faced” but we can still tackle climate change if we act quickly, the International Energy Agency (EIA) said. According to the agency's landmark report, all countries have to stop all investment in new fossil fuel plants -- right now.
Never before has the EIA made such a strong warning to drastically scale back fossil fuels.
The agency laid out a set of milestones on how we could reach net-zero emissions by 2050, including not selling fossil-fuel cars beyond 2035 and doubling global investment in renewable energy from two to five trillion dollars a year -- which would actually end up helping the economy overall.
More than 30 million new jobs would be created, adding 0.4% points a year to global GDP growth. On the other hand, about five million jobs would be lost in sectors such as coal, but a smooth transition could be achieved with healthy government action. The technology to significantly reduce emissions is already available, the EIA said.
“If governments are serious about the climate crisis, there can be no new investments in oil, gas and coal, from now – from this year,” Fatih Birol, the IEA’s executive director, told The Guardian. “More countries are coming up with net zero commitments, which is very good, but I see a huge and growing gap between the rhetoric and the reality.”
Renewable energy grew at a record pace throughout 2020, despite the coronavirus pandemic, the IEA said last month. In total, the world’s renewable electricity capacity grew 45% to 280 gigawatts (GW). Such increases would now be the “new normal,” with another 280 GW of renewables expected to be added in 2022 alone.
Nevertheless, emissions would have its second biggest rise on record this year because of a resurgence of coal after last year’s lockdowns. Pledges done by governments to take climate action have been so far insufficient to meet the goals of the Paris Agreement, a climate treaty that seeks to limit temperature increase to 2ºC.
Simply put, it's good that we're adding more and more renewable energy, but that only works if we also phase out fossil fuels -- not increase them.
The road ahead
The IEA's report was welcomed by climate campaigners, and will have major consequences for energy markets. It’s the first time the energy agency has released a scenario that is properly aligned with the Paris Agreement goals. Such was the interest on the report that IEA’s website crashed for hours -- which almost never happens for energy reports.
But it won't be easy.
Chris Smith, a researcher at the School of Earth and Environment at the University of Leeds, told the Financial Times that meeting the goals of the Paris Agreement will require an “unprecedented shift” in the world’s energy system over the next 30 years. As the leading energy authority, the IEA is the best agency to assess how to transition to net zero CO2, Smith said. The EIA called for further developments in batteries, particularly for use in electric vehicles, hydrogen and carbon capture. These will be necessary as some sectors will have difficulties in decarbonizing, such as aviation, shipping and steel and cement manufacturing. The rest of the economy would reduce its emissions with technologies already available.
Governments would have to reach 400 milestones in order to bring down the emissions of the energy sector by 2050, the EIA explained, such as a ban on gas boilers. The analysis considered a global population rise of two billion people and the need to supply energy to 785 million people who now don’t have access and clean cooling to 2.6 billion people who currently lack it.
A sustainable future
By 2050, the IEA assumes global energy use will shrink by around 8%, with the global electricity sector achieving net zero emissions by 2040. Fossil fuel use would fall from providing almost four-fifths of total energy supply today to slightly over one-fifth by 2050, with unabated coal power generation phased out everywhere by 2040.
Oil and gas producing countries would see their annual per capita income fall by about 75% by the 2030s. While new sources of revenue will be needed, “these are unlikely to compensate fully for the drop in and oil and gas income,” the report said. Countries like Angola and South Sudan would be among the most vulnerable ones.
“An organisation that has been rightly criticised in the past for systematically underestimating the growth of renewable power and overestimating future demand for fossil fuels, is now saying that rapidly accelerating growth of renewable power is the answer, and there is no need for new fossil fuel exploration,” Tim Lenton of the University of Exeter told The Financial Times.