The world has a water problem. More than 2.1 billion people drink contaminated water. More than half the global population – about 4.5 billion people – lack access to proper sanitation services. More than a third of the global population is affected by water scarcity, and 80% of wastewater is discharged untreated, adding to already problematic levels of water pollution.
These statistics make for uncomfortable reading but energy can be part of the solution.
The linkages between water and energy are increasingly recognised across businesses, governments and the public – and have been a major area of analysis in the World Energy Outlook. Thinking about water and energy in an integrated way is essential if the world is to reach the United Nations’ Sustainable Development Goals (SDGs) on water: to ensure the availability and sustainable management of water and sanitation for all.
The connection works in both directions. The energy sector accounts for roughly 10% of total water withdrawals and 3% of total water consumption worldwide. Water is essential to almost all aspects of energy supply, from electricity generation to oil supply and biofuels cultivation. Energy is also required for water treatment and to move water to where it is needed; in a first-of-a-kind global assessment, the World Energy Outlook found that, on aggregate, the energy consumption in the water sector globally is roughly equal to that of Australia today, mostly in the form of electricity but also diesel used for irrigation pumps and gas in desalination plants.
With both water and energy needs set to increase, the inter-dependencies between energy and water will intensify. Our analysis finds that the amount of water consumed in the energy sector (i.e. withdrawn but not returned to a source) could rise by almost 60% to 2040. The amount of energy used in the water sector is projected to more than double over the same period.
This challenge will be especially acute in developing countries. This is where energy demand is rising fastest, with developing countries in Asia accounting for two-thirds of the growth in projected consumption. This is also where water demand is likely to grow rapidly for agriculture as well as supply to industry, power generation and households, including those getting access to reliable clean water and sanitation for the first time. This growth will lead to higher levels of wastewater that must be collected and treated, and will require that water supply is available when and where it is needed. As such, how the water-energy nexus is managed is critical, as it has significant implications for economic and social development and the achievement of the UN SDGs, especially SDG 6 on water.
Technology is opening up new ways to manage the potential strains on both the energy and water sides, with creative solutions that leapfrog those used in the past. For example, building new wastewater capacity that capitalizes on energy efficiency and energy recovery opportunities being pioneered by utilities in the European Union and the United States could help temper the associated rise in energy demand from providing sanitation for all and reducing the amount of untreated wastewater (SDG Target 6.2 and 6.3). In some cases, achieving these targets could even produce energy: WEO analysis found that utilizing the energy embedded in wastewater alone can meet more than half of the electricity required at a wastewater treatment plant.
Summary of SDG 6: Ensure availability and sustainable management of water and sanitation for all
6.1: Universal and equitable access to safe and affordable drinking water for all
6.2: Universal access to adequate and equitable sanitation and hygiene for all and end open defecation, paying special attention to the needs of women and girls
6.3: Improve water quality by reducing pollution, halve the proportion of untreated wastewater and substantially increase recycling and safe reuse globally
6.4: Increase water-use efficiency across all sectors, ensure sustainable withdrawals and supply for freshwater to address water scarcity and lower number of people suffering from water scarcity
6.5: Implement Integrated Water Resource Management at all levels
6.6: Protect and restore water-related ecosystems
6 A/B: Expand international cooperation and capacity-building support to developing countries and strengthen participation by local communities
Source: United Nations, sustainabledevelopment.un.org/sdg6
Smart project designs and technology solutions can also help to reduce the water needs of the energy sector (thereby helping to achieve SDG Target 6.4). The availability of water is an increasingly important measure for assessing the physical, economic and environmental viability of energy projects, and the energy sector is turning to alternative water sources and water recycling to help reduce freshwater constraints. There is also significant scope to lower water use by improving the efficiency of the power plant fleet and deploying more advanced cooling systems for thermal generation.
Moreover the achievement of other energy-related SDGs, including taking urgent action on climate change (SDG 13) and providing energy for all (SDG 7), will depend on understanding the integrated nature of water and energy.
Moving to a low-carbon energy future does not necessarily reduce water requirements. The more a decarbonisation pathway relies on biofuels production, the deployment of concentrating solar power, carbon capture or nuclear power, the more water it consumes. If not properly managed, this means that a lower carbon pathway could exacerbate water stress or be limited by it.
Many who lack access to energy also lack clean water, opening up an opportunity to provide vital services to those most in need, provided these connections are properly managed. Pairing renewable decentralised energy systems (off-grid systems and mini-grids) with filtration technologies can provide both accesses to electricity and safe drinking water (Target 6.1). Similarly, linking a toilet with an anaerobic digester can produce biogas for cooking and lighting. Replacing diesel powered generators with renewables, such as solar PV, to power water pumps can help lower energy costs. However, if not properly managed, this could lead to the inefficient use of water, as was the case in the agricultural sector in India.
As such, the IEA’s new Sustainable Development Scenario, which presents an integrated approach to achieving the main energy-related SDG targets on climate change, air quality and access to modern energy, will add a water dimension to this analysis this year. The aim is to assess what the implications of ensuring clean water and sanitation for all are for the energy sector, and what policymakers need to do to hit multiple goals with an integrated and coherent policy approach.
The WEO’s work on water as part of the Sustainable Development Scenario will be part of WEO-2018, to be released on 13 November, 2018. For more on the WEO’s work on the water-energy nexus, visit iea.org/weo/water
The IEA’s Experts’ Group on R&D Priority-Setting and Evaluation (EGRD) will host a workshop on Addressing the Energy-Water Nexus through R&D Planning and Policies on 28-29 May, 2018.
Solar powering sustainable development in Asia and the Pacific
The way energy is produced, distributed and used causes environmental damage – most visibly air pollution – that in turn harms people’s health. It is also one of the major drivers of climate change. Recognising this, countries are urgently looking to shift to more sustainable energy, but the transition has so far been slow. Put simply, our future depends on our ability to decarbonize our economies by the end of the century. This was recognised by the Paris climate agreement in 2015 and is central to the United Nations 2030 Agenda for Sustainable Development. Sustainable Development Goal 7 (SDG 7) sets countries the twin challenge of meeting new benchmarks in renewable energy and energy efficiency, while ensuring universal access to modern energy.
In Asia and the Pacific, progress towards SDG 7 needs to be accelerated. While 99 percent of the population is expected to have access to electricity by 2030, access to clean cooking fuels will reach only 70 percent of our region’s population, leaving far too many people exposed to the deadly impacts of indoor air pollution. Energy intensity – a measure of our economies’ energy efficiency – is set to decrease but will fall short of 2030 Agenda targets if no further action is taken. At the same time, the share of renewable energy in total energy consumption is only expected to reach 14 percent, well under the 22 percent share required.
Solar energy has a major part to play in closing these gaps. It is an opportunity we must seize for low carbon development, energy security and poverty alleviation. Because solar power can bring clean, emissions-free and evenly distributed energy. This is particularly relevant to Asia and the Pacific, where developing countries have abundant solar energy resources. Solar energy technology increasingly offers a cost-effective alternative to extending networks to outlying and often challenging geographical locations. A potential which has been captured by the Indian leadership’s ambition for “one world, one sun, one grid”.
Governments, the private sector and investors are now thinking over the horizon, planning for a more sustainable and low carbon future. The cost of renewable technologies, very much including solar power has dropped rapidly, bringing these solutions within reach. India now has the newest and cheapest solar technology of anywhere in the world. Mini-grids or standalone solar home systems can be deployed quickly and help reduce greenhouse gas emissions. Due in part to unsustainable subsidies and in part to inertia, coal fired electricity is set to continue to grow in the short to medium term, but wind and solar must play a much more substantial role sooner rather than later for us to have a chance of meeting the SDGs or achieving the aspirations of the Paris Agreement.
India is supporting this solar revolution. By founding and hosting the International Solar Alliance, it has moved decisively to increasing access to solar finance, lowering the cost of technology and building the solar skills needed among engineers, planners and administrators. But it has also set an unparalleled deployment target for solar power generation. The National Solar Mission aims to reach 100 GW of solar power generation by 2022 and has spurred intense activity in solar development across India which has captured the imagination of the region.
At the Economic and Social Commission for Asia and the Pacific, the development arm of the United Nations in the region, we are clear solar energy can boost renewables’ share in our power mix, increase energy efficiency and bring electricity to remote parts of the region. Our research is focused on overcoming the challenges of achieving these three elements of SDG7. Upon request, we support countries maximize the potential to adopt sustainable energy through technical support and capacity building, including through the development of energy transition roadmaps. Work is also underway to develop a develop a regional masterplan on sustainable energy connectivity, vital to make the most of solar power by supporting the growth of cross border power systems.
A core purpose of sustainable development is to ensure we leave future generations a world which affords them the same opportunities we have enjoyed. This is within our grasp if we work across borders to promote solar energy throughout Asia and the Pacific. India has a major role to play. Its experience gives us a historical opportunity to shape best practices in solar energy for our region and reduce carbon emissions. This is experience we cannot afford to waste.
Phasing Out Coal and Other Transitions: Lessons From Europe
Climate change reports are seldom sanguine. Carbon dioxide, the principal culprit, is at record levels, about twice the preindustrial value and a third higher than even 1950. Without abatement it could rise to a thousand parts per million in a self-reinforcing loop spiraling into an irredeemable ecological disaster. The UN IPCC report warns of a 12-year window for action.
Contrasting President Trump’s boast of US energy independence based on coal and other fossil fuels in his SOTU address on Tuesday, two Democrats, Senator Ed Markey and Rep. Alexandria Ocasio Cortez, have introduced a 10-page Green New Deal resolution to achieve carbon neutrality within ten years. While this target may not be technically feasible, it is an admirable start to the discussion. At the same time, the Germans are attacking the problem forcefully as demonstrated by their new coal commission report issued last week.
In November 2016, the German Federal Government adopted its Climate Action Plan 2050. It outlined CO2 reduction targets in energy, industry, buildings, transport and agriculture. Energy is the most polluting; its emissions total the sum of all the others except industry and energiewende (energy change) was a key aspect of the plan.
So even as our atavistic president is promoting coal, Germany, the EU economic powerhouse, announced it is planning to phase out all coal-fired power stations by 2038. As outlined in the November 2016 plan, a commission comprising delegates from industry, trade unions, civil society including environmental NGOs and policy makers was appointed in 2018 to examine the issue and prescribe an equitable solution. After eight months of negotiations and discussions, concluding with a final 21-hour marathon session, it has produced a dense 336-page document. Only one member out of 28 cast an opposing vote, and Greenpeace added a dissenting option as it wants the process to begin immediately.
Such an objective was a special challenge because of Germany’s long industrial history coupled with coal mining. The plan shuts down the last coal-burning power station by 2038 as the final step in the pathway outlined — an ambitious alternative is to exit by 2035 if conditions permit. Total capacity of coal-using stations in Germany is about 45 gigawatts, and the report sets out a four-year initial goal of 12.5 gigawatts to be switched-off i.e. about two dozen of the larger 500+ megawatt units by 2022. Progressively, eight years later (by 2030) another 24 gigawatts will have been phased out leaving just 9 gigawatts to be eliminated by 2035 if possible but definitely by 2038 at the latest.
It is a demanding plan for coal has been deeply embedded with German industry. To ease the pain for tens of thousands of workers and their families, the plan allocates federal funding to deal with its broad ramifications i.e. job loss and displacement. An adjustment fund will be used for those aged 58 and over to compensate pension deficits. Funds are also directed towards retraining for younger workers and for education programs designed to broaden skills.
It includes 40 billion euros to develop alternative industry in coal mining states plus money not directly project-related. In addition further investments in infrastructure and a special funding program for transport adding up to 1.5 billion euros per year are allocated in the federal budget until 2021.
The change-over will raise electricity prices, so a 2 billion euro per year compensation program for users, both private individuals and industrial, will continue until 2030. This is designed to relieve the burden on families, and to maintain industrial competitiveness.
Germany is not alone. The EU has issued an analysis of accelerated coal phase-out by 2030. The Netherlands has its own energiesprong (energy leap) focused on energy transition and energy neutral buildings, meaning that the buildings generate enough energy through solar panels or other means to pay for the energy deficit from their construction and use. It can now clad entire apartment blocks in insulation and solar panels, and is reputed to be so efficient that some buildings are producing more renewable energy than consumed. This expertise is also being utilized in the UK.
Given the forests, the Norwegians have tried something different. They have built the world’s tallest wooden skyscraper, the Mjøs Tower, 85 meters high in Brumunddal. Its wood sourced from forests within a 50 km radius uses one-sixth the energy of steel and of course much less, if at all, emission of greenhouse gases.
By the end of Germany’s enormous sector-wide endeavor, it expects to reduce CO2 emissions to roughly half through 2030 and 80-95 percent by 2050. The comprehensive and complete nature of the program
could serve as a blueprint here in the US. Thus the obvious question: If Germany with a far larger proportion of its workforce associated with coal can do it, why can’t the US?
The mysterious case of disappearing electricity demand
Authors: Stéphanie Bouckaert and Timothy Goodson*
Electricity is at the heart of modern life, and so it’s easy to assume that our reliance on electricity will increase or even accelerate. However, in many advanced economies the data reveals a surprisingly different story.
Electricity demand has increased by around 70% since 2000, and in 2017, global electricity demand increased by a further 3%. This increase was more than any other major fuel, pushing total demand to 22 200 terawatt-hours (TWh). Electricity now accounts for 19% of total final consumption, compared to just over 15% in 2000.
Yet while global demand growth has been strong, there are major disparities across regions. In particular, in recent years electricity demand in advanced economies has begun to flatten or in some cases decline – in fact electricity demand fell in 18 out of 30 IEA member countries over the period 2010-2017. Several factors can account for this slowing of growth, but the key reason is energy efficiency.
There have been a range of new sources of electricity demand growth in advanced economies, including digitalization and the electrification of heat and mobility. However savings from energy efficiency have outpaced this growth. Energy efficiency measures adopted since 2000 saved almost 1 800 TWh in 2017, or around 20% of overall current electricity use.
Over 40% of the slowdown in electricity demand was attributable to energy efficiency in industry, largely a result of strict, broadly applied, minimum energy performance standards for electric motors. In residential buildings, total energy use by certain classes of appliances has already peaked. For example, energy use for refrigerators (98% of which are covered by performance standards) is well below the high point reached in 2009, and energy use for lighting has also declined. In the absence of energy efficiency improvements, electricity demand in advanced economies would have grown at 1.6% per year since 2010, instead of 0.3%.
Changes in economic structure in advanced economies have also contributed to lower demand growth. In 2000, around 53% of electricity demand in the industrial sector came from heavy industry, but by 2017 this figure had fallen to less than 45%. Advanced economies now account for 30% of global steel production, for example, down from 60% in 2000, and for 25% of aluminium production, also down from around 60% in 2000.
Finally, electricity demand for heat and mobility increased by only 350 TWh between 2000 and 2017. Today, electric cars represent only 1.2% of all passenger vehicle sales in advanced economies and account for less than 0.5% of the passenger vehicle stock. Since 2000, only around 7% of households in advanced economies have switched from fossil fuels (mainly gas) to electricity for space and water heating purposes, and use of electricity for meeting heat demand in the industrial sector remains marginal. In many regions, the price of electricity relative to fossil fuels limits its competitiveness for heating end-uses.
When we look to the future, the pace of electrification is set to pick-up somewhat in advanced economies. Nonetheless, electricity demand growth is projected to remain sluggish in the IEA’s New Policies Scenario (NPS), as improvements in energy efficiency continue to act as a brake on increasing demand for many end-uses. In addition, fewer purchases of household appliances (most households in advanced economies today own at least one of each major household appliance such as refrigerators, washing machines and televisions), and a shift from industry to the less electricity-intensive services sector, all contribute to lower electricity demand growth.
On average, electricity demand in advanced economies is projected to grow at just 0.7% per year to 2040 in the NPS, with the increase largely due to digitalization and policies that incentivise the use of electric vehicles and electric heating. Without those policies, electricity demand would continue to flatten or even decline in many advanced economies.
There are other factors at play. For example, population growth in many advanced economies is barely exceeded by electricity demand growth, meaning that further growth in GDP per capita does not lead to an increase in electricity demand per capita (as an exception, the industry sector in Korea accounts for a large share of electricity demand, and so it is one of the few advanced economies that sees industry contribute to overall electricity demand growth on a per capita basis).
Ultimately, despite moderate growth in electricity demand, fuel-switching to electricity and energy efficiency improvements in the use of other fuels mean the share of electricity in final consumption is projected to increase to 27% in advanced economies by 2040, up from 22% today.
*Timothy Goodson, WEO Energy Analyst
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