WHAT NEW ENERGY CAN DO

IEA sees the first early signs of an energy technology revolution underway across the globe but urges that much more needs to be done to achieve the necessary long-term CO2 cuts
1 July 2010 (International Energy Agency)

THE POINT
Too many of the folks who are committed to protecting the invisible hand of the free market will allow no abridgements to the many federal subsidies and protections for the fossil fuel industries. It is more than a hypocritical contradiction. It is an obstruction.

In two ways it obstructs many valuable things. With the excuse that fossil fuels are the “only practical” answer, it obstructs the shift of half-century-old and century-old subsidies to today’s needs. With the “holiness” of the free market as an excuse, it obstructs support for New Energy and Energy Efficiency. By obstructing the emergence of the New Energy economy, these hypocritical Old Energy advocates obstruct greater energy security and freedom from oil dependence for the country, the revenues, jobs, and economic expansion that will follow a New Energy economy, and the blessings of enhanced stewardship for this good earth.

The entwined insistence on (a) an unregulated free market that doesn’t actually exist and (b) protections for the fossil fuels’ advantages that keep the unsupported energies down obstructs one other thing: The world's efforts to take concerted action against worsening climate change caused, the vast preponderance of scientific evidence verifies, by the greenhouse gases spewed by burning of fossil fuels. Not so coincidentally, the fossil-foolish defenders of a non-existent unregulated free market are largely the same folks who insist there is nothing human activity can do to impact climate change.

Happily, Energy Technology Perspectives (ETP) 2010, a new report from the International Energy Agency (IEA) says the community of nations seems to slowly be turning the tide on this contingent of obstructionists and showing what New Energy can do. Even better, there are emerging reports that President Obama has successively joined with leaders of the G20 nations in action to take back the fossil fuel subsidies. (See OBAMA-LED WORLD OIL SUBSIDY CUTS)

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Evidence of what a New Energy economy can do cited in the IEA report: (1) World investment in New Energy electricity generating capacity (especially wind and solar) was a record $112 billion in 2008 and stable in 2009 despite the recession. (2) The top tier of international carmakers are preparing to bring battery electric vehicles (BEVs) to showrooms and market predictions foresee 5 million BEVs in service by 2020. (3) The developed economies of the Organization for Economic Cooperation and Development (OECD) are increasing their Energy Efficiencies at ~2% per year, twice the 1990s rate. (4) New Energy and Energy Efficiency research, development and demonstration (RD&D) investment increased by one-third from 2005 to 2008, turning around a quarter-century downward trend, and the major economies are expected to double RD&D investment by 2015.

ETP 2010 acknowledges the trends but says they are still too fragmented, slow, and fragile. Greenhouse gas emissions (GhGs) levels continue to rise. The obstructionists are still winning because they are blocking concerted, unified, unhesitating action. If they succeed in sustaining business-as-usual (BAU) and preventing aggressive changes, the report foresees continued fossil fuel dependence and GhGs doubling by mid-century.

With the policy changes it lays out in its BLUE Map scenario, however, a New Energy economy can be affordably built that will cut GhGs in half by 2050 and keep the global average temperature increase at or below 3o C. while moving the world away from oil dependence and developing secure domestic energy sources and the revenues, jobs and economic expansion they offer.

Energy Efficiency (EE) will be one key because it is the cheapest and most accessible way to cut GhGs and because it will immediately generate savings that can fund the building of New Energy infrastructure. Developing economies must replicate the developed nations’ EE improvements.

The world must also rapidly grow New Energy capacity. The IEA report includes nuclear energy and “clean” coal (carbon capture and storage, CCS) capacity as well. Perhaps by mid-century these technologies will be financially feasible. By 2050, the IEA calls for moving today’s 18% of electricity from emissions-free sources to ~50%, leading to the use of 50+% BEVs for personal transport.

The cost: $46 trillion more than BAU, mostly in consumer spending for NE, EE equipment and the purchase of BEVs. The return on investment from energy savings: $112 trillion, not counting other economic, social and environmental benefits.

Outcome: OECD countries cut GhGs 70-to-80% from 2010 levels and non-OECD countries cut GhGs 30%.

Key to success: The biggest, fastest-growing economies (Brazil, China, India, the Russian Federation and South Africa)

Note: The 2010-to-2020 decade is crucial to keeping the cost of fighting climate change within reach. If GhGs do not peak and start falling by 2020, the cost to stop catastrophic climate change could make stopping it unachievable.

Final point: The IEA is the most conservative of organizations plotting the future of New Energy. If the IEA says New Energy can do this much, it is highly likely it can do much more.

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THE DETAILS
Business-as-usual (BAU) will not create the United Nations (UN) Intergovernmental Panel on Climate Change (IPCC)-recommended GhG reductions of at least 50% from year 2000 levels by 2050 that will keep global average temperature rise to at or below 2.4o C. And most recent research has shown that 50% goal to be inadequate.

The Copenhagen Accord of December 2009 was a step toward breaking away from BAU and resetting the world’s goal at keeping the temperature rise to less than 2o C. It created a spirit of agreement about developing New Energy and Energy Efficiency.

In ETP 2010, the IEA evaluates existing technologies costs and benefits and lays out a roadmap, based on the policies needed to drive growth of the most favorable electricity generation and fuels choices for industry, buildings and transport. It includes specific analyses of OECD Europe, the United States, China and India and their combined 56% of world primary energy demand.

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The report has chapters on (1) policies and the needed accompanying behavioral changes, (2) the spread of technologies throughout developed and emerging economies, (3) financing and returns on investment, and (4) the primary New Energy technologies and their impacts in the power sector, electricity networks, the industry, buildings, and transport sectors and on the environment.

It makes it clear that action is underway in all these areas.

Though growth so far has been local and “bottom up,” the scale of transition needed will require a concerted worldwide effort, especially because the world’s economies are so completely interdependent and GhGs are not a local matter. At the local level, there is already coordination between government and the private sector. The policies described in the report aim to expand it.

BAU for even another decade could mean facing the worst impacts of global climate change.

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In the ETP 2010 BLUE Map scenario: (1) Oil, natural gas and coal demand in 2050 will fall and world oil demand will be 27% below the 2007 level. (2) U.S. oil demand will fall 60% from 2007, OECD Europe’s will fall 50%, and China’s will be only half that now projected. (3) World oil demand will plateau in the 2030-to-2035 period.

New Energy will provide 48% of power generation, nuclear energy will provide 24% and CCS power will provide 17%.

The IEA projects that 55% of CCS use will be in power generation, 21% in industry and 24% in fuel transformation. Maybe by 2050 but not any sooner.

To obtain 50% of the world’s electricity from emissions-free sources by 2050, the ETP 2010 calls for 30+ new nuclear plants and 35 “clean” coal facilities yearly.

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With the BLUE Map energy supply, emissions are cut: (1)17% by New Energy; (2) 6% by nuclear energy; (3) 19% by CCS; (4) 5% by power sector efficiency and fuel switching; (5) 15% by end use fuel switching; and (6) 38% by end use fuel and electricity efficiency.

Primary energy consumption rises 32% instead of 84% and emissions-per-energy unit falls 64% instead of increasing 7%.

80% of light duty vehicles will be battery electric vehicles and petroleum use falls to 50% of transport use.

Financing is one of the most substantial challenges to deployment. Another is identifying the best mechanisms in developing countries. Serious skills shortages expected in some GhG-free technologies pose yet another.

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The transition to a New Energy economy and an energy technology revolution, according to ETP 2010, is within reach. But getting to it will require a coordinated effort from the full spectrum of stakeholders because it will require the greatest capacities of all energy-sectors to meet substantial upfront costs.

The payoff will come if concerted, comprehensive effort is not obstructed.

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QUOTES
- Nobuo Tanaka, Executive Director, IEA: “For several years, the IEA has been calling for an energy revolution to tackle climate change and enhance energy security and economic development. For the first time, we see early indications that such a revolution is under way…What we need is rapid, large-scale deployment of a portfolio of low-carbon technologies; we need a massive decarbonisation of the energy system, breaking the historical link between CO2 emissions and economic output, and leading to a new age of electrification…This shift is vital…to economic development, energy security and environmental protection…By providing concrete guidance, ETP 2010 aims to prompt broader engagement of all players and sectors, and achieve the necessary step-change in the rate of progress.”

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- From ETP 2010: “Throughout energy circles, the threat of climate change has held the spotlight in recent years. Meanwhile, two other concerns have re-emerged from the shadows. The financial crisis of 2008/09, which some analysts link with volatile oil prices, reinforced the concern that high energy prices can cripple economic growth. Headlines announcing gas supply cuts to the Ukraine, oil tanker hijackings along the coast of Somalia, pipeline bombings in Nigeria, and hurricanes destroying oil rigs in the Gulf of Mexico showed that threats to energy security arise in many forms and unexpected places. For several years, the IEA has been presenting the case that an energy revolution, based on widespread deployment of low-carbon technologies, is needed…ETP 2010 highlights early signs that such an energy technology revolution is under way…Yet these encouraging developments represent but the first small, fragmented steps on a long journey towards transforming the way we supply and use energy…”

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- From ETP 2010: “Concern about energy security, the threat of climate change and the need to meet growing energy demand (particularly in the developing world) all pose major challenges…Advancing the low-carbon technology revolution will involve millions of choices by a myriad of stakeholders…Yet choice, in itself, can be a barrier: wading through the reams of information to arrive at the best choice can be quite paralysing. This book demonstrates that a portfolio of existing and new technologies will be needed to address these challenges, and lays out both the priority areas for action and the mechanisms that can help deliver change…”