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Reaching energy and climate goals demands a dramatic scaling up of clean energy technologies

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A major effort to develop and deploy clean energy technologies worldwide is urgently needed to meet international energy and climate goals, particularly in order to reduce carbon emissions from areas beyond the power sector such as transport, buildings and industry, according to a new IEA report released today.

With global carbon emissions at unacceptably high levels, structural changes to the energy system are required to achieve the rapid and lasting decline in emissions called for by the world’s shared climate targets. The IEA’s Energy Technology Perspectives 2020 – the first core ETP report for three years following a revamp of the series – analyses more than 800 different technology options to assess what would need to happen to reach net-zero emissions by 2070 while ensuring a resilient and secure energy system.

It finds that transitioning just the power sector to clean energy would get the world only one-third of the way to net-zero emissions. Completing the journey will require devoting far more attention to the transport, 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, according to the report, although many more technologies will be needed.

“Despite the difficulties caused by the Covid-19 crisis, several recent developments give us grounds for increasing optimism about the world’s ability to accelerate clean energy transitions and reach its energy and climate goals. Still, major issues remain. This new IEA report not only shows the scale of the challenge but also offers vital guidance for overcoming it,” said Dr Fatih Birol, the IEA’s Executive Director.

“Solar is leading renewables to new heights in markets across the globe, ultralow interest rates can help finance a growing number of clean energy projects, more governments and companies are throwing their weight behind these critical technologies, and all-important energy innovation may be about to take off,” Dr Birol said. “However, we need even more countries and businesses to get on board, we need to redouble efforts to bring energy access to all those who currently lack it, and we need to tackle emissions from the vast amounts of existing energy infrastructure in use worldwide that threaten to put our shared goals out of reach.”

Energy Technology Perspectives 2020 (ETP 2020) examines how to address the challenge of long-lasting energy assets already operating around the world – including 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. It finds that the power sector and heavy industry sectors together account for about 60% of emissions today from existing energy infrastructure. That share climbs to nearly 100% in 2050 if no action is taken to manage the existing assets’ emissions, underscoring the need for the rapid development of technologies such as hydrogen and carbon capture.

Ensuring that new clean energy technologies are available in time for key investment decisions will be critical. In heavy industries, for example, strategically timed investments could help avoid around 40% of cumulative emissions from existing infrastructure in these sectors. Accelerated innovation is crucial for this – and for scaling up the clean energy technologies needed across the energy system.

Hydrogen is expected to play a large and varied role in helping the world reach net-zero emissions by forming a bridge between the power sector and industries where the direct use of electricity would be challenging, such as steel and shipping. In the IEA’s Sustainable Development Scenario – a pathway for reaching international energy and climate goals – the global capacity of electrolysers, which produce hydrogen from water and electricity, expands to 3 300 gigawatts in 2070, from 0.2 gigawatts today. In 2070, these electrolysers consume twice the amount of electricity that China generates today. Carbon capture is also employed across a range of sectors in the Sustainable Development Scenario, 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.

The blistering pace of technological transformation that would be necessary for the world to reach net-zero emissions by 2050 is explored in the report’s Faster Innovation Case. It finds that to meet the huge increase in demand for electricity, additions of renewable power capacity would need to average around four times the current annual record, which was reached in 2019.

Governments need to play an outsized role in accelerating clean energy transitions towards meeting international goals, according to ETP 2020. The report highlights core areas that policy makers need to make sure they address. And it notes that economic stimulus measures in response to the Covid-19 crisis offer a key opportunity to take urgent action that could boost the economy while supporting clean energy and climate goals.

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Colombia’s energy districts: an example for the region

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image: UNIDO

An energy district is a local institution that leads, implements and accelerates a locally-owned, inclusive and clean energy transition. In the process, energy districts create local jobs and retain and grow wealth, while simultaneously reducing carbon emissions and air pollution.

Colombia is a pioneer South American country in the promotion of this approach. Beginning in 2013, the United Nations Industrial Development Organization (UNIDO), together with Switzerland’s State Secretariat for Economic Affairs (SECO), has been implementing an energy districts project in cooperation with the Ministry of Environment and Sustainable Development (Minambiente) and the public utility of the city of Medellín (Empresas Publicas de Medellín – EPM).

In its second phase, beginning in 2019, the project has been working closely with national and city-level authorities and stakeholders to improve and implement national and sub-national policy and regulatory frameworks to promote further development of energy districts; reinforce knowledge and capacities for energy districts of all market players; and provide technical assistance to some 10 selected cities so that they can include energy districts in their urban planning and support the realization of two-three near-future mature projects.

From the 17-19 November, the UNIDO project and partners, ACAIRE (Colombian Association for Refrigeration and Air Conditioning) and CIDARE, the Centre of Research and Development in Air Conditioning and Refrigeration hosted the Third International Conference for Energy Districts, a virtual event bringing together national and international experts from industry and academia, and representatives from the public sector and international organizations.

Carlos Eduardo Correa, Colombia’sMinister of Environment and Sustainable Development, stated that the conference was the ideal scenario to show the achievements of the country in the implementation of district energy as a contribution to the Sustainable Development Goals.

“All of our actions, plans, projects and regulations, are geared towards the achievements of the Nationally Determined Contributions, the reduction of greenhouse gas emissions, and, at the same time, the contribution of low-carbon development. Here, Colombia has an important experience and is an example for the region,” he stated.

The progress of district energy in Colombia and the region, the importance of their implementation in urban planning, energy maps and clean energy transition, the mechanisms to finance these projects and the use of renewable energies in their execution, were some of the main topics addressed by more than 30 national and international speakers during the three days of discussions.

“The implementation of the project has, as a main component, the sustainability of knowledge and capacities in Colombia. That is why the support and work with academia are fundamental to strengthen the capacities of all the actors in the value chain and promote the education of professionals in the areas of sustainability and energy efficiency, among others,” noted Alex Saer, Director of Climate Change and Risk Management at the Ministry of Environment and Sustainable Development.

The conference was also the opportunity to celebrate the awards of the Second Competition for Universities in District Energy, with the objective of designing a business model for the sale of thermal energy applied to residential users.

The contest, which had the participation of eight universities from Colombia, awarded the first-place winner team with  fully funded attendance to the International District Energy Association Campus Energy in Boston in February 2022.

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Global energy efficiency progress is recovering – but not quickly enough

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A rapid expansion of technologies and solutions that drive more efficient use of energy across the economy is necessary to keep global climate pledges within reach, according to a new IEA report, which urges governments to take the lead in mobilising the required increase in investment.

Global progress on energy efficiency has recovered this year to its pre-pandemic pace, but that was already well short of what would be needed to help put the world on track to reach net zero emissions by mid-century, according to Energy Efficiency 2021, the IEA’s annual market report on the topic. Total annual investment in energy efficiency worldwide needs to triple by 2030 to be consistent with a path towards reaching net zero emissions by 2050, as set out in the IEA’s Roadmap to Net Zero by 2050.

The IEA’s latest global assessment of market and policy trends in energy efficiency highlights the urgent need for stronger implementation of clean energy policies – with energy efficiency at their core – in order to reach international climate goals. This is the first update of the IEA’s energy efficiency market report since a raft of new spending commitments aimed at supporting the economic recovery were announced by governments over the course of 2021.

The report comes shortly after the end of the COP26 Climate Change Conference in Glasgow, whose final statement specifically called for the rapid scaling up of energy efficiency measures, recognising their key role in decarbonising energy systems. 

“We consider energy efficiency to be the ‘first fuel’ as it still represents the cleanest and, in most cases, the cheapest way to meet our energy needs. There is no plausible pathway to net zero emissions without using our energy resources much more efficiently,” said IEA Executive Director Fatih Birol. “A step change in energy efficiency will give us a fighting chance of staving off the worst effects of climate change while creating millions of decent jobs and driving down energy bills.”

The report notes that governments have scaled up existing, employment-intensive efficiency programmes, but it also highlights that substantial potential for job creation remains untapped. For example, investments in the energy efficiency of buildings – a well-established driver of construction jobs – are expected to rise by 20% in 2021 compared with pre-pandemic levels. Even with this record level of spending, the report details how 4 million more jobs could be added by 2030 by further increasing spending on efficient buildings, appliances and other measures in line with the IEA’s Net Zero Emissions by 2050 Scenario.

After its worst year in a decade in 2020, when the Covid-19 pandemic shifted the centre of economic activity away from services and towards industry, the rate of improvement in global energy intensity – a key indicator of how efficiently the world’s economic activity uses energy – is expected to recover in 2021 to 1.9%. This is line with the average annual rate of improvement over the past 10 years but well below the 4% needed between 2020 and 2030 in the IEA’s pathway to net zero emissions by 2050.

As energy efficiency offers some of the fastest and most cost-effective actions to reduce CO2 emissions, front-loading efficiency measures into net zero strategies will be crucial for closing the gap between climate ambitions and current trends. This year’s report examines over 40 energy efficiency milestones mapped out in the IEA Roadmap to Net Zero by 2050 that can enhance efficiency and help get emission reductions on track.

In addition to well-developed energy efficiency policies such as appliance standards – which in some countries have avoided electricity usage equivalent to their total wind and solar power generation – the report also underlines the increasingly important role for digital technologies in energy efficiency’s future. Rapid uptake of digitally connected devices is helping to expand the scale and scope of benefits from energy efficiency, and can deliver a cheaper, easier and more cost effective clean energy transition.

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Fatih Birol urges Middle Eastern producer economies to accelerate clean energy transition

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IEA Executive Director Fatih Birol today received a lifetime achievement award at the major international energy industry conference ADIPEC, which is hosted by the United Arab Emirates. The award was presented by Sultan Ahmed Al Jaber, the UAE Special Envoy for Climate Change, in recognition of Dr Birol’s long-standing work assessing the global energy sector and providing clarity on how it can adapt to the clean energy transition.

The acknowledgement of Dr Birol’s efforts to advance the clean energy transition comes at a time when the IEA is multiplying its efforts to build a broad coalition to accelerate global climate action that includes the oil and gas exporting countries in the Middle East and North Africa. It also comes after the recent announcement that the United Arab Emirates will host the COP28 Climate Change Conference in 2023, after Egypt hosts COP27 next year.

“I would like to congratulate Fatih Birol on a truly well-deserved recognition of his lifetime’s commitment across the energy landscape. His understanding of how the whole energy system fits together is unparalleled. Moreover, his practical approach to ensuring sustainable development is having – and will continue to have – a positive, powerful impact on how the world makes an equitable and orderly transition to the energy system of the future,” said Sultan Al Jaber in presenting the award to Dr Birol in Abu Dhabi.

“The global warming that is already affecting us all worldwide is especially treacherous for Middle Eastern and North African countries – some are experiencing warming at a far higher rate than the global average. The region is today going through its worst drought in over 900 years,” Dr Birol said in his acceptance speech during the awards ceremony in Abu Dhabi. He underscored the need for oil and gas producing economies to reduce their reliance on fossil fuels and rapidly shift towards cleaner alternatives.

“More than at any other point in recent history, fundamental changes to the economic model of resource-rich countries look unavoidable. The future will look very different from the past,” he told the audience. “That is why it is so important that we work together. We need to deploy traditional strengths in support of economic diversification and low-carbon transformation. First movers – countries that take a proactive approach to this – could do especially well.”

In his remarks, Dr Birol highlighted that the IEA’s work with multiple countries across the region centres on supporting efforts to decarbonise energy systems while also securing the economic benefits that the clean energy transition can bring.

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