Fossil fuel companies continue to hang onto an in-your-face stance that the global energy demand for oil will rebound after covid-19. They are holding fast to beliefs that the climate change policy moves of governments around the world will be more methodical than meteoric, more cautious than critical. In fact, this year’s World Energy Outlook publication from the International Energy Agency has stated that it won’t be until 2040 that oil and gas production will be cut by 50% compared to current levels.
Rising fossil fuel consumption is the leading cause of the global climate crisis. It’s been clear for all too long that the global energy system is in desperate need of a full shift to clean energy. The International Energy Agency needs to halt its kowtowing to the fossil fuel industry and, instead, promote clean energy in every way possible.
The International Energy Agency (IEA)’s annual report is one that oil executives savor, as it affirms illusions that we live in a static world in which fossil fuel appetites are consistent, necessary, and ongoing. This year’s World Energy Outlook reiterates a vision in which fossil fuels will continue to dominate the energy mix far into the foreseeable future. This is heady stuff, as it provides investors and governments with the foundation they need to make financial decisions.
Bill McKibben of 350.org calls these predictions “almost literally the definition of a self-fulfilling prophecy.” He says that this is truly problematic, as the “world it confidently imagines is an impossible one.” Why?
Last year, when the UN released its World Meterological Organization (WMO) Statement on the State of the Global Climate 2019, UN Secretary General A. Guterres warned:
“We are currently way off track to meeting either the 1.5 °C or 2 °C targets that the Paris Agreement calls for. We need to reduce greenhouse gas emissions by 45% from 2010 levels by 2030 and reach net zero emissions by 2050. And for that, we need political will and urgent action to set a different path.”
The WMO statement outlined how fossil fuel CO2 emissions have increased steadily over the past two centuries, with brief interruptions due to minor dips associated with major economic downturns such as recessions or oil price shocks. Over the 2009–2018 decade, for which complete data are available, global fossil CO2 emissions were on average 34.7 ± 1.8 GtCO2 (billions of tons) per year, growing at an average rate of 0.9% per year to reach a record 36.6 GtCO2 in 2018.
When is the IEA going to step up and promote a clean energy tomorrow?
Looking at a Near-Future, Post-COVID-19 World Energy Outlook Isn’t Enough
The Outlook unabashedly looks to “the impacts of the covid-19 pandemic on the energy sector and the near-term actions that could accelerate clean energy transitions.” By zooming in on “the key uncertainties facing the energy sector in relation to the duration of the pandemic and its implications,” the report examines just the next few years as its specific focus. That’s not enough — the IEA should see covid-19 as a signal to end fossil fuels altogether.
The report predicts that the “global energy demand rebounds to its pre-crisis level in early 2023” with what’s termed a Stated Policies Scenario. The immediacy of that timeframe eases the likely ennui of oil producers and their constituents significantly. The problem is that the report accentuates the demand for natural gas — albeit, “mainly in Asia” — and allows only for “major economic uncertainties resulting from the pandemic” that make oil “vulnerable.”
McKibben points out that, if the IEA’s current “sustainable development scenario” lands on the exit of fossil fuel around 2070, “then the World Habitability Outlook, if there were such a thing, would be grim.” He argues that even the miniature scenario that the IEA provides to reach net zero by 2050 is still too far afield of the climate targets set in Paris in 2015.
Sure, in the meantime, we can take a holistic, value-chain approach to the consumer goods sector as a significant influence on both agricultural emissions associated with food production and household emissions. Industries that are major contributors to the world’s carbon emissions certainly include making steel and cement. Yet, when companies like ExxonMobil continue to chart their own course and thus help heat the Earth’s environment to the point where human beings will no longer be able to survive, is it enough to call for long-term industry plans to reduce carbon emissions and transition to renewable energy?
Acknowledging Our Clean Energy Future
The World Outlook admits that “pressure is meanwhile increasing on many parts of the industry to clarify the implications of energy transitions for their operations and business models and to explain the contributions that they can make to reducing emissions.” That’s a weak call, a delay in the inevitable.
The IEA must seek much more immediate and stringent planning from its oil industry members. What we really need to see — and which the World Outlook refers to — is an intensive focus on the “rapid growth of solar, wind, and energy efficiency technologies, (as) the next 10 years would see a major scaling up of hydrogen and carbon capture, utilization and storage, and new momentum behind nuclear power.”
The report allows that “a higher carbon intensity of the economy in this scenario illustrates the peril of mistaking low growth for a solution to climate change.” Addressing the climate challenge involves fundamental changes to existing systems, often called “sustainability transitions,” that entail profound and interdependent adjustments in sociotechnical systems that cannot be reduced to a single element. Instead, it requires interacting developments such as new technology infrastructures, business models, regulation, municipal planning, and lifestyles — all of which need to be driven by fossil fuel industry shifts to clean energy.
Recognizing that “a structural transformation of the energy sector will require massive investment in new, more efficient, and cleaner capital stock” is significant and a real opportunity for fossil fuel companies to reinvent themselves. The International Renewable Energy Agency says that investment in renewable energy needs to be scaled up “significantly and urgently.” They’ve determined that the power sector alone would require investment of nearly $22.5 trillion in new renewable installed capacity through 2050 — at least a doubling of annual investments compared to current levels, from almost $310 billion to over $660 billion.
The World Energy Outlook speaks to renewables as having “starring roles in all our scenarios.” They continue to value hydropower as the largest renewable source, but also point to solar as the “main source of growth, followed by onshore and offshore wind.” Mark Jacobson and research team outline in a 2019 report how wind, water, and solar will reduce end-use energy by 57.1%, aggregate private energy costs from $17.7 to $6.8 26 trillion/yr (61%), and aggregate social (private plus health plus climate) costs from $76.1 to $6.8 trillion/yr (91%) at a present value capital cost of ~$73 trillion. The numbers are striking and very persuasive. The IEA needs to take a closer look.
What Would it Take for the IEA to Ground the World Energy Outlook in Science?
McKibben calls on the IEA to “model what science says we require to survive and then chart a path toward getting us there.” The New York Times bemoans a future in which US federal policy rejects scientific reasoning, a sad time in which “the empirical truths ferreted out by doctors, scientists, and engineers no longer have currency because there is no one left to act on them.”
Rejecting such dismissal of science takes activism, often where it hasn’t emerged before. For the first time in their storied histories, the nation’s oldest scientific publications — Scientific American and the New England Journal of Medicine — have entered electoral politics and rejected a second term of a Trump presidency.
And policy shifts of governments can help. In the United Kingdom, the government has expressed interest in having all of its home electricity come from offshore wind by 2030. And a Biden administration can lead the way, pointing out how a working future aligned with a green economy and the science of statistical forecasts can point us away from the existential crisis which we currently face. As example, Biden committed to eliminating fossil fuel subsidies during the October 15 televised Town Hall.
Importantly, a stable clean energy future needs banks and financiers to withdraw their funding sooner than later. JPMorgan Chase, the world’s biggest fossil-fuel investor, has committed to a Paris alignment of its lending practices. The list of financial institutions and major stockholders who are divesting from fossil fuel holdings is getting longer and longer. Earlier this year, the Norwegian Sovereign Wealth Fund sold $3 billion worth of energy stocks and other companies it finds are seriously harming the environment. While lots of individuals are making financial sacrifices to disempower the fossil fuel industry, the surge in financial management funds away from fossil fuels is at the heart of the divestment movement.
It’s time for the IEA to become transparent about the future of clean energy — for its members and for our world.
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