August 03, 2022 | Renewables & Decarbonization
Planet earth is in immediate need of rescue. Two of the planetary boundaries, biosphere integrity, and biochemical flows, are beyond the zone of uncertainty, with climate and land system change boundaries approaching high-risk zones soon. Anthropogenic climate change is real. And unless addressed urgently, we may not have a planet to live in towards the end of the century.
Net-zero was first coined by the IPCC (Intergovernmental Panel on Climate Change) in a report published urging governments and corporations to act on climate change. Today about 76% of global emissions have been pledged to achieve net zero by 2050 by more than 110 countries. Although a powerful international coalition is committed to reaching net-zero targets, the feasibility of accomplishing this task is incredibly challenging and will depend on immediate uninhibited action.
“In model pathways with no or limited overshoot of 1.5°C, global net anthropogenic CO2 emissions decline by about 45% from 2010 levels by 2030 (40–60% interquartile range), reaching net zero around 2050 (2045–2055 interquartile range)” – IPPC.
In other words, net-zero means carbon emissions need to be reduced by the year 2050 and to be more specific, temperature increases may not exceed 1.5°C above the pre-industrial baseline. Before COP 21, or The Paris Climate Conference, the limiting temperature was 2.0°C, and before COP 22, on 4 November 2016, it was set to 1.5°C following new data. One hundred eighty-six countries ratified this new target of not exceeding 1.5°C.
To achieve such a daunting goal which will inevitably disrupt the current modes of operation, various stakeholders must be engaged and on board throughout the process. More specifically, policymakers, investors, and stakeholders within the production, transportation, and energy sectors, will need to play a proactive role if we achieve net zero by 2050. Successfully reaching net zero within the next 28 years will require a strategic path with actionable targets, and most countries currently lack near-term policies and measurements.
If we consider the 76% of global emission reduction targets as accomplished, we would still be left with 22 billion tons of CO2 emissions worldwide in 2050. In other words, not only are the current pledges not enough to achieve a net-zero goal by 2050, but by fulfilling the pledges only, a temperature rise of ~2.1°C would be seen in 2100.
As noted by the United Nations Environmental Programme, “given the lack of transparency of net-zero pledges, the absence of a reporting and verification system and the fact that few 2030 pledges put countries on a clear path to net zero emissions, it remains uncertain if net zero pledges will be achievable.”
To truly grasp the magnitude of work required to achieve net zero by 2050, the International Energy Agency (IEA) published a roadmap report to clarify what practical changes need to be made to achieve the ambitious target of net zero by 2050.
In the IEA’s proposed roadmap, by 2030, the global economy would have grown by 40% but only uses 7% less energy to operate. The IEA’s path to net-zero by 2050 is anything shy of radical. Yet, it is based on factual data, proving that an unapologetic transformation of the energy sector to reduce CO2 and methane emissions from the supply is possible and necessary if we are to reach the net-zero target. This transformation will require a concerted effort of innovations in technology electrification, bioenergy, hydrogen, carbon capture, and utilization and storage (CCUS).
In the recommended path to net-zero by IEA, there are key milestones that should be considered, broken down into years and specific industries (buildings, transport, industry, electricity, heat, other):
o No new full-capacity coal plants have been approved for development
o No new oil and gas fields approved for development, no new coal mines, or mine extension
o No new sales of fossil fuel boilers
o Phase out full-capacity coal in advanced economies
o 1020 GW annual solar and wind additions
o New clean technology in heavy industry at scale
o 60% of global car sales are electric
o All new buildings are zero-carbon ready
o Universal energy access
o Net-zero emissions electricity in advanced economies
o All industrial electric motor sales are efficient
o No new ICE car sales
o 50% of heavy truck sales are electric
o Appliances and cooling systems sols are efficient
o Phase out full-capacity coal and oil power plants
o Net-zero emissions electricity globally
o 90% of existing capacity in heavy industries reaches the end of the investment cycle
o 50% of fuels used in aviation are low emission
o 50% of existing buildings retrofitted to zero-carbon ready
o 50% of heating demand is met by heat pumps
o 70% of electricity generation globally from solar PV and wind
o > 90% of heavy industrial production is low emissions
o > 85% of buildings are zero carbon ready
The IEA’s path and timeline to realistically reach net-zero by 2050 outlines not only transformative milestones within industries over a period but also how these milestones can be accomplished and some of the possible challenges that will be encountered along the way. To understand IEA’s approach, three uncompromising topics and challenges that will allow us to reach net-zero by 2050 are renewable energy transition, the role of investors and governments, and the importance of innovation at scale.
Renewable Energy Transition
The clean energy transition is a significant infrastructure effort focused on “killing” oil and coal and rapidly “giving birth” and “growing” renewable methods of energy creation. In the immediate global future (2022 – 2030) an increase in solar photovoltaic (PV) and wind need to increase at a rate of 30% to accomplish net-zero by 2050, while phasing out coal plants bring us 600 GW of solar PV and 340 GW of wind added each year from 2030 to 2050 in the energy sector. The electricity sector will undoubtedly increase demand as developing countries advance and the global population increases. This increase in energy supply will result in a worldwide electricity demand increase of 3.2% per year, of which 75% will come from the emerging markets and developing countries.
Today, 36% of CO2 emissions come from electricity generation. In other words, electricity production via coal, gas, and oil plants are the largest polluters of CO2 emissions today. Therefore, the transition to solar PV and wind is critical to reaching net-zero by 2050. Additionally, battery storage systems and hydropower must combine these renewable energy sources to guarantee electricity security across seasons.
Electricity makes up around 20% of the total energy mix, with renewable energy sources approaching merely 30% of the electricity generation. Various industries will experience a slow and challenging transition toward electrification. The transportation and industry sectors will still largely depend on oil, coal, and natural gas to operate efficiently.
The reality is that the transition to renewables will require a lot of time and effort. Although oil and gas companies can incorporate new technologies like CCUS, hydrogen‐based fuels, advanced biofuels, biomethane, or even offshore wind, not all companies will choose.
Investors and Governments
Reaching net zero by 2050 becomes an almost impossible challenge to overcome without the investment in a transitional renewable electricity network. The initial investment into renewable energy infrastructure will increase from USD 820 billion in 2030 to USD 1 trillion in 2040 before equalizing demand growth, and decarbonization is met.
The investments must come with backing from governments regarding how to transition and retrofit coal, gas, and oil power plants through implementing carbon capture regulation or a co-firing approach with hydrogen-based fuels before fully closing these facilities. International coalitions must coordinate the closure of 870 GW of coal capacity globally (power capacity of 11%) while simultaneously finding a substitute. As IEA’s proposed timeline, allowing all large oil and coal-fired plants to phase out by 2040. The net-zero by 2050 goal will need strong government support in all impact areas, transitioning to renewable energy, investor engagement, and innovation support. Governments must create new policies to lower risk and incentivize the market to develop disruptive business models and mobilize private spending.
Innovations at Scale
Currently, the industrial sector will see the “slowest” shift, given that it is estimated that roughly 60% of heavy industry emissions will come from technologies that are not yet ready for market implementation around hydrogen and CCUS; therefore, this transition is dependent on the speed of scaling innovation and investors. The most significant innovation leaps are advanced batteries, hydrogen electrolyzers, and direct air capture and storage. These technologies will be able to impact the reduction of CO2 emissions drastically. Still, they must be accompanied by an infrastructure that supports their scalability—for example, pipelines to move captured CO2 emissions and systems to transport hydrogen around industrial zones.
The IPCC has published scientific reports, and the global community has come together to set targets to achieve net-zero; now, we must do all we can to reach those targets. Nevertheless, some challenges must not be ignored.
The proposed IEA pathway comes with many challenges, not only in implementation but also in unintended consequences. Still, it is a dramatic wake-up call that this target will require an unfathomable collective effort from governments, investors, and industry globally.
To overcome these challenges at a high-level, buy-in from all human stakeholders will be critical for this target to be achieved.
1. Governments will need to manage their fiscal policy and long-term planning to ensure that they are not solely dependent on revenues from non-renewable energy, that their citizens are equipped with jobs and skills to meet the new transition, and create standards to drive private investment into renewable technologies.
2. Investors and industry must also work collectively to build resilient systems to combat potential market volatility and energy security as the demand for copper, cobalt, manganese, and various rare earth metals increase with the transition.
3. Without a global team, the effort to achieve net-zero by 2050 will be improbable as the work needed depends on extensive collaboration within the political, economic, and technological sectors.
Accepting failure in the fight for sustainability without the worthy battle is a fatal flaw. The earth cannot sacrifice the right to exist in the future for today’s welfare. An uncompromised struggle to save the planet must be embarked upon. Clear messaging to raise awareness among everyone on the earth is a must. The change of mindset must be forced. Funds must be directed towards the most urgent and not the most profitable. Research must focus on safeguarding the basics ahead of exploring the luxury. Accepting the status quo is not an option. A net zero target must be sought.