International Energy Agency (IEA) warns that the global community needs to triple its investment in renewable energy if it plans on combating climate change.
It stresses that the investments in the transition to renewable sources for power are alarmingly falling short of the required numbers needed to meet future demand sustainability.
Ahead of the United Nations COP26 climate change conference, IEA has said that countries need to increase the investment in renewable energy needs before the end of this decade and keep the volatile energy markets under control while combating climate change. The IEA released its annual World Energy Outlook on Wednesday which stated,” The world is not investing enough to meet its future energy needs … transition‐related spending is gradually picking up but remains far short of what is required to meet the rising demand for energy services in a sustainable way,”
The report added, “Clear signals and direction from policymakers are essential. If the road ahead is paved only with good intentions, then it will be a bumpy ride indeed”.
The Paris based watchdog described the upcoming meeting in Glasgow, Scotland as the “first test of the readiness of countries to submit new and more ambitious commitments under the 2015 Paris Agreement” and “an opportunity to provide an ‘unmistakable signal’ that accelerates the transition to clean energy worldwide”.
Faster energy transition needed
Power prices soared to all-time high levels as oil and natural gas prices surged to multiyear highs while Asia, Europe, and the United States experienced widespread energy shortages. As a result, the demand for fossil fuel strengthened and governments relaxed their policies which were implemented to curtail the spread of COVID-19.
The IEA said that global communities need to increase the share of renewables such as solar, wind, and hydropower as well as bioenergy drastically under energy investment in the post-pandemic times.
IEA pointed out that although over two-thirds of investment in new power capacity during 2021 will be in renewables, a large gain in oil and coal consumption has led to the second-largest annual increase in climate change-causing CO2 emissions.
The agency stressed that a faster energy transition is needed to protect consumers in the future, as a commodity price shock would inevitably drive up costs for households 30 % less in its most ambitious Net Zero Emissions by 2050 (NZE) scenario versus its more conservative Stated Policies Scenario (STEPS).
Status quo against net zero
The leap required to follow through with the pledges in the 2015 Paris agreement to cap the increase in temperatures to as close as possible to 1.5 degrees Celsius (2.7 degrees Fahrenheit) above pre-industrial times remains vast.
Coal, natural gas, and oil contributed to around 80% of the world’s energy supply last year while renewables made up only 12% of the total.
To maintain that rise near 1.5C, the IEA’s NZE projects those fossil fuels dwindling to just below a quarter of the mid-century supply mix and renewables climbing sharply to more than two-thirds.
If the world remains on its current path outlined by the STEPS scenario, temperatures will rise 2.6C (4.7F) by 2100.
The IEA projects the demand for oil peaking in all its scenarios for the first time, in the mid‐2030s in the STEPS forecast with a very gradual reduction but in the NZE forecast plateauing within 10 years and lowering further by nearly three-quarters by 2050.
Reiterating the agency’s starkest warning yet pertaining to the future of fossil fuels that it made in a report issued in May, the IEA said its NZE picture projected lower demand and a spike in low emissions fuels making new oil and gas fields beyond 2021 unnecessary.
However, it also noted that new oil fields would be needed in its two most conservative scenarios and provided guidance on combating their climate impact through measures such as reducing methane flaring.
IEA warned, “Every data point showing the speed of change in energy can be countered by another showing the stubbornness of the status quo. Today’s energy system is not capable of meeting these challenges; a low emissions revolution is long overdue.”