The Sky’s Limit: Why the Paris Climate Goals Require a Managed Decline of Fossil Fuel Production Oil Change International, in collaboration with: 350.org, Amazon Watch, APMDD, AYCC, Bold Alliance, Christian Aid, Earthworks, Équiterre, Global Catholic Climate Movement, HOMEF, Indigenous Environmental Network, IndyAct, Rainforest Action Network, and Stand.earth September 2016 http://priceofoil.org/

The Paris goals Holding the increase in global average temperature to well below 2°C above preindustrial levels; Pursuing efforts to limit the temperature increase to 1.5°C above preindustrial levels.

Emissions pathways Sources: Rogelj et al, IPCC scenario database

Carbon budgets Peak warming is determined by the cumulative amount of CO2 emitted over all time. For a given temperature target, there is a total budget for how much can be extracted and burned.

Fossil fuel reserves vs carbon budgets Many will be familiar with this – FF reserves massively exceed what the world can afford to burn. This raises the question of WHICH (which countries’) reserves belong in the green box vs the dashed red boxes These are 66% chance of 2C (since it’s a hard limit) and 50% chance of 1.5C (since it’s more of a goal in the Paris Agreement) – NOTE NOT V PRECAUTIONARY ODDS! 2°C 1.5°C Sources: Rystad Energy, World Energy Council, IPCC; Global Carbon Project

Developed reserves vs carbon budgets Implication: no more can be developed, and some have to be closed down early. Developing new fields and mines would make the problem even more difficult 1.5°C Sources: Rystad Energy, IEA, World Energy Council, IPCC, Global Carbon Project

Managed decline

Recommendations No new fossil fuel extraction or transportation infrastructure should be built, and governments should grant no new permits for them. Some fields and mines – primarily in rich countries – should be closed before fully exploiting their resources, and financial support should be provided for non-carbon development in poorer countries. This does not mean stopping using all fossil fuels overnight. Governments and companies should conduct a managed decline of the fossil fuel industry and ensure a just transition for the workers and communities that depend on it.

The front lines Undeveloped coal reserves by country Sources: World Energy Council, IEA, IPCC

The front lines Undeveloped coal reserves by country Sources: World Energy Council, IEA, IPCC

The front lines

Developed countries still on coal

Production from existing fields Oil Gas

Oil and gas vs clean energy If we allowed production from existing oil and gas fields only, and phased out coal (except for use in steel), we’d need 50% RE by 2035 and 80% by RE – this is achievable with political will Sources: IEA, Jacobson et al, Rystad Energy, Oil Change International analysis

What about other sources of CO2? Sources: Rystad Energy, IEA, World Energy Council, IPCC, Global Carbon Project

What about methane and other GHGs? Carbon budget approach does not apply to short-lived GHGs. Budgets are for CO2 only, calculated based on assumptions about emissions of other GHGs.

The Paris goals Holding the increase in global average temperature to well below 2°C above preindustrial levels; Pursuing efforts to limit the temperature increase to 1.5°C above preindustrial levels.

Carbon budgets

Definitions Reserves: The best estimate of the most likely amount that would be extracted, if there were no new exploration, no new technology, an assumed most-likely price scenario, and no climate or other restrictions. Developed reserves: The portion of reserves for which investment has already taken place, for which no new major investment decision is required: A field or mine; A development phase; A frack well.

Sources Assumptions Oil and gas: Rystad UCube Coal: International Energy Agency Assumptions No CCS Price base case Politically rather than economically optimised

Recommendations No new fossil fuel extraction or transportation infrastructure should be built, and governments should grant no new permits for them. Some fields and mines – primarily in rich countries – should be closed before fully exploiting their resources, and financial support should be provided for non-carbon development in poorer countries. This does not mean stopping using all fossil fuels overnight. Governments and companies should conduct a managed decline of the fossil fuel industry and ensure a just transition for the workers and communities that depend on it.

Why the supply side?

The Sky’s Limit: Why the Paris Climate Goals Require a Managed Decline of Fossil Fuel Production Oil Change International, in collaboration with: 350.org, Amazon Watch, APMDD, AYCC, Bold Alliance, Christian Aid, Earthworks, Équiterre, Global Catholic Climate Movement, HOMEF, Indigenous Environmental Network, IndyAct, Rainforest Action Network, and Stand.earth September 2016 http://priceofoil.org/

Backup

Reserves uncertainty Economics/technology: assume no change Geological knowledge: Proven: P90 Probable: P50 Expectation: mean Possible: P10

What are developed reserves?

What are developed reserves?

Why the supply side?

Infrastructure lock-in

Stranded assets

The pace of transition