World's Current Energy Policies Likely To Produce Major Climate Change, IEA Says

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By Rick Mitchell

PARIS—The world needs “stringent” new energy infrastructure investment policies—and quick—if it is to avoid climate calamities linked to global warming, the International Energy Agency warned in a report released in London Nov. 9.

IEA's 2011 World Energy Outlook, which analyzed energy and climate trends for the years leading up to 2035, said average global temperatures could rise 6 degrees Celsius (10.8 degrees Fahrenheit) above preindustrial levels by the century's end if countries fail to implement any energy and climate policy changes at all in the next five years.

That increase is triple the level that U.N. scientists have said would produce catastrophic climate change.

But the Paris-based IEA, which advises 28 wealthy countries, said that even if countries “cautiously” implement commitments they have recently made under U.N.-sponsored climate negotiations to reduce their carbon dioxide emissions, the globe will still likely heat up a dangerous 3.5 degrees C (6.3 degrees F) in this century.

To avoid this predicament, IEA urged countries to act immediately to boost investment in energy-efficient and low-carbon technologies—including renewable energy, nuclear energy, and carbon capture and storage—and to put a price on carbon.

The price tag for such policies could exceed $15 trillion, on top of $38 trillion already needed for energy infrastructure investments in the period ending 2035, IEA said.

Surging Demand for Energy Noted

The Outlook said population growth and emerging economies' rising living standards are pushing up global energy use, and thus emissions of atmosphere-warming carbon dioxide.

Despite a shaky economic recovery, global primary energy demand surged 5 percent in 2010, pushing carbon dioxide emissions to a new high, even as subsidies that encourage “wasteful” consumption of fossil fuels exceeded $400 billion, it said.

Some 80 percent of the total energy-related carbon dioxide the world can emit by 2035 and still have a chance of avoiding dangerous climate change is already “locked in” via existing power plants, buildings, factories, and other capital stock, IEA said.

This leaves just a small window of opportunity to make a difference, using the right policies, it said.

Three Scenarios Outlined

As in previous years, the IEA Outlook presented three scenarios to illustrate the impact that government polices can have on energy-related carbon dioxide emissions: a do-nothing scenario, the baseline “New Policies Scenario,” and the so-called 450 Scenario that would offer a 50 percent chance of avoiding major climate change.

IEA officials have said holding the average global temperature rise to 2 degrees C (3.6 degrees F), considered a tipping point for catastrophic climate change, would require limiting long-term atmospheric concentrations of greenhouse gases to about 450 parts per million (ppm) of carbon dioxide-equivalent.

The report also presented a “Low Nuclear Scenario” that estimates the impact of a possible reduction of nuclear power's role in energy production.

New Policies Scenario Most Likely

Under the most likely New Policies Scenario, in which countries conservatively implement commitments they have made under U.N.-sponsored climate negotiations, global energy-related carbon dioxide emissions would still rise 20 percent by 2035 and global temperatures would climb 3.5 degrees C in this century.

Primary energy demand would rise one-third by 2035, with emerging and developing countries accounting for 90 percent of this growth.

By 2035, China would consume 70 percent more energy overall than the United States, which it only recently passed to become the world's biggest energy user. The United States would still consume twice as much as China per capita by that date, however.

Under the baseline scenario, fossil fuels' share in primary energy consumption would fall from 81 percent today to 75 percent in 2035. Even so, oil demand would continue to grow, driven primarily by the transportation sector in emerging economies.

Electric and hybrid vehicles would make only slow inroads into markets, IEA said.

Nuclear Disaster Could Alter Picture

Coal use would soar 65 percent by 2035, with much of that increase coming in China, IEA said. More efficient coal-driven power plants and carbon capture and storage could reduce emissions from this source of electricity, but IEA said CCS especially has faced technical, regulatory, and policy barriers that have hindered deployment.

Renewables' share would rise from 13 percent to 18 percent, led by hydropower and wind, accounting for half of the new capacity installed to meet growing demand.

Overall, modern renewables—defined as all types with the exception of traditional biomass—would grow faster than any other energy form in relative terms, but in absolute terms total supply would still not be close to the level of any single fossil fuel in 2035, IEA said.

Under the New Policies Scenario, nuclear power's share of overall consumption would increase by 70 percent by 2035, led by China, Korea, and India, but IEA noted that Japan's Fukushima Daiichi disaster this year has raised safety questions that could alter this picture.

It said it is too early to project the disaster's long-term impact on the global nuclear power industry, but it noted that Japan, until recently the world's third biggest user of nuclear power, has shut down most of its 54 nuclear reactors for safety reviews, while Germany has announced plans to rapidly abandon nuclear power and Switzerland plans a phaseout by 2034 (34 INER 988, 10/12/11).

So-Called 450 Scenario

Under the so-called 450 Scenario, governments would adopt the policies needed to hold long-term global atmospheric concentrations to about 450 ppm of carbon dioxide-equivalent by 2050.

According to IEA, this would theoretically give the world a 50 percent change of managing to hold global warming under 2 degrees C in this century, and thus avoid exponential increases in the number and intensity of catastrophic droughts, floods, and other climate disasters.

In this scenario, fossil fuels' share in the global energy mix falls from 81 percent in 2009 to 62 percent in 2035. Global demand for both coal and oil would peak before 2020, declining 30 percent for coal and 8 percent for oil by 2035 from 2009 levels.

Natural gas demand would grow 26 percent before plateauing near 2030, IEA said.

Under this scenario, carbon dioxide emissions peak before 2020 and then decline to 21.6 gigatons by 2035.

Achieving the 450 Scenario would cost $15.2 trillion in cumulative investment in and consumer spending on energy-related equipment on the supply and demand sides. That would be on top of some $38 trillion IEA said is needed to build the energy infrastructure of the future under the baseline New Policies Scenario.

Noting the dire straits facing many economies, IEA said many countries might put off these investments. But it said this could quadruple the costs of making them beyond 2017.

“If stringent new action is not forthcoming by 2017, the energy-related infrastructure then in place will generate all the CO2 emissions allowed in the 450 Scenario up to 2035, leaving no room for additional power plants, factories and other infrastructure unless they are zero-carbon, which would be extremely costly,” IEA said.

Low Nuclear Scenario

Under the Low Nuclear Scenario, nuclear power's share of total consumption would drop from 13 percent in 2010 to 7 percent in 2035, leading to greater use of fossil fuels and consequently more rapid global warming, the agency said.

Compared to the baseline New Policies Scenario, overall energy-related carbon dioxide emissions under the Low Nuclear Scenario would be 2.6 percent higher by 2035, while power plant emissions would be 0.9 gigaton, or 6.2 percent, higher, according to the report.

The Paris-based IEA advises 28 of the 34 member countries of the Organization for Economic Cooperation and Development, including the world's biggest market economies, and thus its big energy users and polluters.

However, China, India, and other emerging Asian economies, Brazil, and Russia are not IEA members. IEA said those countries would account for almost all of the energy demand growth under the New Policies Scenario.

More information on the 2011 World Energy Outlook is available at .