Demand for fossils needs to fall by 25% by 2030 – 09/26/2023 – Environment

Demand for fossil fuels must fall by a quarter by the end of this decade if governments want to limit global warming to 1.5°C above the level of the pre-industrial period, concluded the IEA (International Energy Agency).

Coal, oil and natural gas will need to be replaced by clean energy at an accelerated pace to keep the world on track to net-zero greenhouse gas emissions by 2050, the OECD-funded energy monitoring agency said in its annual assessment.

The projections are the latest warning for the oil and gas sector since the IEA surprised the industry in 2021 by saying there is no room for new exploration projects if we are to limit global warming.

The agency’s latest projections come at a time of growing tension with oil producers ahead of UN climate talks in the UAE at COP28 in ten weeks’ time, with the OPEC cartel accusing the IEA of fueling “volatility”. and drive away investors.

The oil and gas industry also tried to undermine the IEA’s projections by ramping up the rhetoric last week at a biennial conference in Calgary, Canada.

For its part, the agency reiterated its view that new oil and gas fields would face “major commercial risks” if the necessary cuts in demand were made, given supplies from existing projects.

But the IEA also warned that clean energy supplies need to expand in line with the reduction in fossil fuel supplies, to avoid energy shortages and price rises.

“The result will be prolonged high prices if the decline in fossil fuel investment in this scenario precludes the expansion of clean energy,” he said, noting that an “orderly” transition is “far from guaranteed.”

Fatih Birol, executive director of the IEA, said some fossil fuels will still be needed until 2030 and governments need to “provide the framework” to ensure a smooth transition to cleaner energy.

The AIE was founded after the Arab oil embargoes in the 1970s to provide advice on energy security. Its members come from OECD countries and include the United States, the United Kingdom and Japan.

The IEA’s observations were made based on its latest report, which presents its assessment of the path to net-zero emissions by 2050.

This is seen as crucial to limiting global warming to ideally 1.5°C above pre-industrial levels by 2050, and well below 2°C, as set out in a commitment signed by nearly 200 countries in the 2015 Paris Agreement. .

The IEA stated that “rigorous and effective policies,” according to its projections, would “boost the deployment of clean energy and reduce demand for fossil fuels by more than 25% by 2030 and 80% by 2050.”

This would imply a drop in oil demand from 100 million barrels per day to 77 million barrels per day by 2030. A drop in natural gas demand from 4,150 billion cubic meters in 2022 to 3,400 billion cubic meters in the same period .

According to the IEA, there have been “positive developments” over the past two years, including the rapid adoption of solar panels and electric vehicles.

However, the agency called for “bolder action” with greater investments in clean energy to increase from $1.8 trillion this year to $4.5 trillion annually by the early 2030s.

It also warned that moving too slowly could result in significant costs, potentially up to $1.3 trillion a year, to remove carbon dioxide emissions from the air after 2050, rather than preventing them from the start.

This would be 50% more than the total investment in fossil fuel supply in 2022 and would result in “a major challenge that requires close international cooperation”, the agency said.

Birol also criticized UK Prime Minister Rishi Sunak’s decision to delay a ban on the sale of petrol and diesel cars until 2035, stating that advanced economies must lead and “increase ambition rather than reduce it”. .

“Keeping alive the goal of limiting global warming to 1.5°C requires the world to come together quickly. The good news is we know what to do — and how to do it.”