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© OECD/IEA 2015 Budapest, 19 October 2015. © OECD/IEA 2015 Energy & climate change today A major milestone in efforts to combat climate change is fast.

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Presentation on theme: "© OECD/IEA 2015 Budapest, 19 October 2015. © OECD/IEA 2015 Energy & climate change today A major milestone in efforts to combat climate change is fast."— Presentation transcript:

1 © OECD/IEA 2015 Budapest, 19 October 2015

2 © OECD/IEA 2015 Energy & climate change today A major milestone in efforts to combat climate change is fast approaching – COP21 in Paris in December 2015 Momentum is building:  Historic US-China joint announcement; EU 2030 targets agreed  Developed & developing countries are putting forward new pledges to reduce emissions  Many energy companies & investors are starting to engage Energy production & use accounts for two-thirds of global greenhouse-gas emissions Energy sector must cut emissions, while powering economic growth, boosting energy security & increasing energy access

3 © OECD/IEA 2015 Energy emissions stall but economic engine keeps running Global energy-related CO 2 emissions For the first time, energy-related CO 2 emissions stalled despite the global economy expanding by 3% 5 10 15 20 25 30 35Gt 198519901995200020052010 Dissolution of Soviet Union Global economic downturn 2014

4 © OECD/IEA 2015 Emissions burden moves over time Cumulative energy-related CO 2 emissions by region Past emissions are important, although the source of emissions shifts with changes in the global economy 2015-2040 1890-2014 100 200 300 400 500 United States EuropeanChina Union RussiaJapanIndiaAfrica Gt

5 © OECD/IEA 2015 National pledges build towards a global agreement Submitted INDCs cover nearly 90% of energy-related GHG emissions, with implications for future energy & emissions trends

6 © OECD/IEA 2015 Climate pledges shift the energy sector One-quarter of the world’s energy supply is low carbon in 2030; energy intensity improves three-times faster than the last decade Renewables reach nearly 60% of new capacity additions in the power sector; two-thirds of additions are in China, EU, US & India Natural gas is the only fossil-fuel that increases its share of the global energy mix Total coal demand in the US, Europe & Japan contracts by 45%, while the growth in India’s coal use slows by one-quarter Climate pledges for COP21 are the right first step towards meeting the climate goal

7 © OECD/IEA 2015 What does the energy sector need from COP21? The IEA proposal for COP21: 1.Peak in emissions – set the conditions which will achieve an early peak in global energy-related emissions 2.Five-year revision – review contributions regularly, to test the scope to lift the level of ambition 3.Lock in the vision – translate the established climate goal into a collective long-term emissions goal 4.Track the transition – establish a process for tracking energy sector achievements

8 © OECD/IEA 2015 1. Peak in emissions: IEA strategy to raise climate ambition Global energy-related GHG emissions Five measures – shown in a “Bridge Scenario” – achieve a peak in emissions around 2020, using only proven technologies & without harming economic growth 20 25 30 35 40 20002014202020252030 Gt CO 2 -eq Bridge Scenario INDC Scenario Energy efficiency 49% Reducing inefficient coal Renewables investment Upstream methane reductions Fossil-fuel subsidy reform 17% 15% 10% Savings by measure, 2030 9%

9 © OECD/IEA 2015 1. Peak in emissions: Bridging strategy is flexible across regions The measures in the Bridge Scenario apply flexibly across regions, with energy efficiency and renewables as key measures worldwide GHG emissions reduction by measure in the Bridge Scenario, relative to the INDC Scenario, 2030 United States European Union China India Middle East Latin America Africa Southeast Asia Russia Fossil-fuel subsidies Efficiency Renewables Inefficient coal plants Methane reductions

10 © OECD/IEA 2015 2. Five-year revision: World’s carbon budget is shrinking A five-year review cycle would enable pledges to keep pace with energy sector innovation; building ambition before the carbon budget is consumed Today20202025203020352040 World’s remaining carbon budget

11 © OECD/IEA 2015 Total 50 100 150 200 201520202025203020352040 Million Vehicle sales 3. Lock in the vision: What more does it take for 2 °C? Cost reductions & deployment of electric vehicles An emissions goal would give greater clarity & certainty to the energy sector, strengthening the case for RD&D investment & technology transfer 100 200 300 400 Dollars per kWh Electric Battery costs Electric vehicles (right axis) Solar PV additions CapacityCapital costs Solar PV (right axis) Cost reductions & deployment of all solar PV 25 50 75 100 201520202025203020352040 GW 1 400 2 100 2 800 Dollars per kW 700 Internal combustion

12 © OECD/IEA 2015 4. Track the transition: Impact of pledges must be monitored Energy sector indicators are needed to track the low-carbon transition; IEA identifies key metrics to monitor energy sector achievements 100 200 300 400 500 600 CO 2 intensity Power g CO 2 per kWh -42% Average fuel consumption of new cars 2 4 6 8 litres per 100 km -43% Transport Lighting intensity of buildings 2 4 6 8 kWh per m 2 -40% Residential 2013 2030

13 © OECD/IEA 2015 Conclusions Pledges are not yet enough to achieve our climate goal, but are a basis from which to build ambition Companies that do not anticipate stronger energy & climate policies risk being at a competitive disadvantage For COP21, the IEA proposes four key energy sector outcomes: 1. Target a near-term peak in emissions 2. Five-year revision, to test the scope for raising ambition 3. Lock in the vision by setting a long-term emissions goal 4. Track the transition in the energy sector Climate change will lead the agenda at the IEA’s Ministerial meeting on 17-18 November 2015

14 © OECD/IEA 2015 www.worldenergyoutlook.org/energyclimate


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