The revolution progress being made in developing fossil fuel-beating renewable energy technologies only puts the world on track to “getting one-third of the way” toward meeting the net-zero carbon targets needed to avert the worst impacts of the climate change, according to the head of the International Energy Agency (IEA).
Fatih Birol, launching the IEA’s Energy Technology Perspectives (ETP) report, said that though the cratering cost of clean-energy production, notably solar and offshore wind, was “grounds for increasing optimism about the world’s ability to … reach its energy and climate goals”, transitioning the power sector to be renewables-driven would “not [get the world] even close” to achieving net-zero emissions without “structural changes” to the global energy system.
“This has been a grave year. A global pandemic and major economic crisis. But in one important area, namely clean-energy transition, I see increasing reasons for being optimistic,” said Birol, speaking at a virtual media briefing.
“Solar is becoming cheaper and cheaper and as it stands now is the cheapest form of electricity generation in many countries around the world,” he said. “In previous years, the bulk of new solar capacity additions came from China and the US, but now [from] everywhere, from Vietnam to Brazil there has been an irreversible move to solar.
“Also, offshore wind: we see a huge decline of costs. These [together] are the first reason why I am optimistic.”
Birol also pointed to the positive impact of the “massive easing” in central banks’ monetary policies in response to the Covid-19-spurred economic crisis that “should mean wind, solar, electric vehicles benefit from ultra-low interest rates for an extended period” which removes “the main hurdle for many clean-energy projects: securing the initial investment”.
“I see that many governments around the world are throwing their weight behind clean energy, advanced economies and emerging countries alike,” he stated. “And most [energy and technology] companies are stepping up their efforts in clean-energy – whether this stepping up in sufficient is another matter but I see a momentum.”
The IEA report, which ran the rule over more than 800 technologies, flagged up that beyond more rapid deployment of renewable energy projects globally, however, “a major effort is urgently needed” to slash carbon emissions from areas outside the power sector, starting with transport, buildings and heavy industry, if the targets set by the 2015 Paris Agreement to keep global heating to 2℃ above pre-industrieal levels, were to be hit by 2070.
“Huge challenges remain. When you look at the energy and climate debate around the world there is an overwhelming concentration on the electricity sector. This is good. But not at all enough to solve our problems as the power sector today is responsible for 38% of emissions – 62% comes from somewhere else,” said Birol.
“Completing the journey [to net-zero] will require devoting far more attention to the transport, [heavy] industry and buildings sectors, which today account for about 55% of CO2 emissions from the energy system.
“Much greater use of electricity in these sectors – for powering electric vehicles, recycling metals, heating buildings and many other tasks – can make the single largest contribution to reaching net-zero emissions, although many more technologies will be needed.”
Birol said there was a significant “blind spot” in the global focus on constructing new clean-energy power capacity, while overlooking the heavy-emitting plants and factories that have been brought online “over years and years and that will with us for several decades to come” and currently account for some 60% of global CO2.
“We need to tackle emissions from the vast amounts of existing energy infrastructure in use worldwide – inefficient coal power plants, steel mills and cement kilns, most of which were recently built in emerging Asian economies and could operate for decades to come – that threaten to put our shared goals out of reach.”
The report found that “strategically timed” investments could help curtail 40% of cumulative emissions from existing heavy industry infrastructure, but this would require that development of technologies including carbon capture and storage, next-generation batteries, and utility-scale green hydrogen electrolysers was “accelerated now”.
“In the IEA’s Sustainable Development Scenario [a roadmap for reaching international energy and climate goals] the global capacity of electrolysers, expands to 3.3TW in 2070, from 200MW today,” said the report’s authors.
“Carbon capture is also employed across a range of sectors, including the production of synthetic fuels and some low-carbon hydrogen. And modern bioenergy directly replaces fossil fuels in areas like transport and offsets emissions indirectly through its combined use with carbon capture.”
“These technologies are ready for the big time,” said Birol, underlining that the world’s governments needed to play an “outsized” role in accelerating clean energy transitions, with the economic stimulus packages being unrolled in response to the Covid-19 crisis offering “a key opportunity” to boost national economies while underpinning climate change-slowing measures.