Net zero targets change the game as IEA hails renewables as new “king” of electricity

Posted by on October 13, 2020 in News

Net zero targets change the game as IEA hails renewables as new “king” of electricity

Renew Economy
Ketan Joshi
13 October 2020 –

You’re going to hear a range of yelping and squealing noises from we energy nerds over the next few days. Love it or loathe it, the release of the International Energy Agency’s IEA) World Energy Outlook (WEO) 2020 is totemic calendar event for policy wonks, power geeks and climate policy watchers around the globe.

Despite the neutral-sounding name, the IEA’s history is specifically skewed towards fossil fuels. “The IEA was created in 1974 to help co-ordinate a collective response to major disruptions in the supply of oil. While oil security this remains a key aspect of our work, the IEA has evolved and expanded significantly since its foundation”, they write on their website. It’s easy still to see hallmarks of this history.

As an example, the only two Australians that peer-reviewed the report are AEMO’s Drew Clarke and…..Peter Morris, a senior member of the Minerals Council of Australia. No Clean Energy Council, no Beyond Zero Emissions, no Climate Council. No university bodies, like the University of Melbourne Sustainability Institute. Most fossil fuel majors, such as BHP, Shell, Saudi Aramco, ExxonMobil, are heavily represented. It’s problematic, to say the least.

The organisation has unmatched access to energy and climate data from around the world, and the WEO is their compression of that trove into a single, ultra-big report.

It’s worth keeping this history in mind when engaging with this report. The numbers it’s based on, particularly the historical data, are relatively objective. The future scenarios reflect

What it says

The WEO 2020 is all about COVID19 – quantifying its current and future impacts on the world’s energy systems and how it links into efforts to reduce emissions. “Our assessment is that global energy demand is set to drop by 5% in 2020, energy related CO2 emissions by 7% and energy investment by 8%”, the write. Oil, coal and gas fall by 8%, 7% and 3% respectively. The pandemic has spawned two new scenarios, in addition to their current visions of the future:

‘Stated Policies Scenario’ (STEPS) – today’s announced policies continue without change

Delayed recovery scenario (DRS) – the pandemic causes major economic damage and slows recovery

Sustainable Development Scenario (SDS) – Hitting the Paris agreement on time (net zero by 2070, ish)

Net zero by 2050  (NZE2050) – The same as SDS, but with a net zero by 2050 target, 20 years earlier

DRS and NZE2050 are both new visions of the future. They’re a welcome addition to the report, which has previously been criticised for not considering ambitious climate action as a possibility.

Also, presumably in response to prior criticisms, predictions of renewable growth are bullish, with the report claiming solar will become the “new king” of electricity. This chart above highlights exactly how, with renewables contributing to nearly all the added energy produced, dwarfing that of nuclear.

The WEO 2020 predicts COVID19 being a permanent blow to coal, but reminds us that oil and gas still need new policies to see significant and rapid reductions. Consequently, the default future is emissions rising after the pandemic, with the ‘good’ future being a downward turn that jumps off the hump of this public health disaster and causes emissions to fall.

There is plenty to say on this several-hundred page report. As an insight into the world’s energy that is necessarily created through the lens of incumbents and dominant fossil fuel producers, it is still important and insightful, both in its objective data sets and its own, unique perspectives and biases.

There will be more to come, but for now, it’s worth noting that the scale of change at the moment is unprecedented – the trick will be ensuring that change works for the better, not for the worse.

And IEA’s critics, who are legion, welcome the addition for the net zero analysis, the first time it has taken 1.5°C seriously, but say it should be front and centre, and indeed their “central” scenario.

“Limiting warming to 1.5ºC is both urgent and possible, but governments and investors alike need pathways that allow them to plan for success, not further entrench fossil fuels,” said Hannah McKinnon, Director of the Energy Transitions and Futures Program at Oil Change International.

“NZE2050 shows that the IEA is hearing growing demands to be on the right side of history. Now the IEA must take the next big step by making a 1.5ºC scenario fully fledged and central in 2021.”