To meet our Paris Agreement obligations, we need an energy outlook that extends past 2030, to 2050 and beyond. That is the conclusion of two recent publications by the International Renewable Energy Agency (IRENA) and DNV GL.
Is Agenda 2030 obscuring our vision? The forecasts of two reports by IRENA and DNV GL indicate that a 2030 deadline is not conducive to sound energy policies. Although neither report explicitly implicates 2030 as the cause of our negligence, their 2050 framing emphasizes that we should not expect to see the fruits of our labor before 2030.
It could be that the scramble to achieve the SDGs by 2030 has shifted the discourse to the short-term, and is thus blinding us to the long-term implications of our actions. We have forgotten that energy reform is highly path dependent; the decisions we make today lock us in for decades. So for instance, our drive to achieve universal energy access by 2030 may obscure the environmental impacts of achieving it using fossil fuels.
The 2030 focus has distorted our measurement of the costs and benefits of the energy transformation, and explains in part our reluctance to make impactful changes now.
Bent Erik Bakken Deputy Program Director at DNV GL’s Energy Transition Program, supports this: “There is no way we can be certain that we will fulfil our Paris goals by 2030. A longer time-frame better qualifies us to determine whether climate change will be addressed or not,” emphasizing the need to plan well beyond 2030.
Although DNV GL’s forecasts indicate that some major milestones will be reached before 2030, such as natural gas overtaking oil as the primary energy supply in 2026, the full suite of environmental, economic and social benefits from the energy transformation will not materialize in such a short time frame.
As a result, the 2030 focus has distorted our measurement of the costs and benefits of the energy transformation, and explains in part our reluctance to make impactful changes now.
The benefits of a 2050 vision
Looking at the energy transformation beyond 2030 and towards 2050, numerous benefits become clear. IRENA’s ‘Roadmap to 2050’ gives salience to the environmental, economic and health benefits of a Paris-compliant energy transformation. Accordingly, the Director General of IRENA, Adnan Z. Amin, describes the potential of the energy transformation as a “path of opportunity.”
For the environment, an energy transformation based on renewable energy, electrification and improvements in energy efficiency has the potential to deliver 90% of the climate mitigation necessary to remain within the two-degree goal.
For the economy, 40 million jobs could be created in renewable energy and energy efficiency, comfortably offsetting losses in fossil fuel employment. In addition, if we act now and avoid being locked-in to new fossil fuel investments, we can also avoid over US$11 trillion in fossil fuel assets from becoming stranded. Most significantly, the savings in health care and climate mitigation costs arising from the energy transformation will cover the initial investment needed five-fold.
For our health, access to clean and affordable energy will radically reduce the human and economic costs of energy production. Indoor pollution is a major cause of respiratory diseases in populations who lack access to electric heating and cooking facilities. This was emphasized by Bent Erik Bakken, who stated that health issues will provide the impetus for the investments in clean energy that we need to make now: “The immediate health consequences of kerosene lamps, coal-fired power plants and diesel combustion are a more effective policy lever for renewable energy than global warming itself.”
A shared blueprint for 2050
The clean energy transformation will require comprehensive and coordinated actions towards 2050 based on a shared vision. The IRENA and DNV GL reports identified the drivers of the energy transformation, which should be brought to the centre of policies and regulations for the long term.
- Accelerating renewable energy uptake
The rate of renewable energy expansion needs to increase six-fold to meet our Paris obligations. This will mean major innovations in storage and transmission technologies.
- Decarbonization through carbon capture
Decarbonization is a two-way street. It will require growth in carbon capture and storage in conjunction with cutting our emissions from fossil fuel consumption.
- Driving energy efficiency
Technologies like smart grids will harness the synergies between renewable energy and efficiency. Digitization and data are also expected to be major drivers of efficiency.
- Electrifying transport, building and industry
Electrification of our carbon-intensive sectors will require 162% growth in electricity generation. This requires immense development of our grid infrastructure if we are to use renewable sources.
- Supporting innovation
Disruptive innovations have the potential to dramatically alter current projections and put us on a path of Paris-compliance. This will take support from the public and private sectors.
- Remembering the socio-economic impacts
The energy transformation won’t happen in a vacuum; it has enormous social and economic implications. We have a responsibility to ensure that the energy transformation is inclusive and benefits everyone. But this is not a risk. It’s a huge opportunity to improve standards of living.
According to Bent Erik Bakken, the energy transformation is everyone’s responsibility: “There is no silver bullet. We must address this problem on all fronts. This means business, civil society and the public sector must all do their part,” says the DNV GL manager.
In order to see the full benefits of the clean energy transformation, we need to start by accounting for the dissonance in the timing of costs and benefits. That means acting now, and acting with purpose. As Adnan Z. Amin concludes, “The world’s actions today will be crucial to create a sustainable energy system. Ultimately, the path to secure a better future depends on pursuing a positive, inclusive, economically, socially and environmentally beneficial energy transformation.”