Fossil Fuel Peak Expected Due to Clean Energy Gap
A peak in fossil fuel use is expected by the middle of the decade and according to the International Energy Agency's (IEA) latest annual World Energy Outlook report: There's still a clean energy gap when it comes to limiting global temperature rise. Released in the lead up to the COP26 climate conference, the report also found:
- In most markets, wind and solar produce the cheapest energy.
- In 2020, coal, natural gas, and oil made up nearly 80% of the world's energy supply.
- In 2021, coal and oil significantly rebounded and led to the second-largest annual increase of carbon emissions.
- Globally, clean energy investments need to triple to avoid catastrophic climate change, and most of those funds should go to developing countries.
IEA: World Energy Outlook 2021 - Launch Event, October 13, 2021.
Why This Matters
To meet global energy needs, there must be a massive ramp-up in the funding of renewable energy systems. The IEA report also highlights a need to increase climate targets, as current promises would only limit warming to 2.1 degrees Celsius by 2100, and with COP26 coming up "a lot more needs to be done by governments to fully deliver on their announced pledges."
Solutions Within Reach
While there's still a sizable gap between the clean energy action and what yet needs to be done, the report notes that solutions exist -- and nearly half of them would result in consumer savings. The following are recommended measures as outlined by the IEA:
- Keep a "relentless" focus on energy efficiency
- Ramp up clean electrification and increase solar & wind to meet rising power demands
- Cut methane emissions, notorious for leaking, along all parts of oil & gas operations
- Boost clean energy innovation, especially in energy-intense industrial sectors like iron, steel, and cement
The report also calls out finance as the "missing link" in the acceleration of clean energy projects in developing countries.
"So far, only about 20% of clean energy investments are going to emerging countries," Dr. Fatih Birol, the IEA's executive director, told the New York Times. "That needs to change. This is a race that no one wins unless everyone finishes..."
Bloomberg Markets and Finance: Clean Energy is Coming Very Strongly: IEA, October 13, 2021.