IEA Unveils World Energy Outlook 2014: Looking Ahead to 2040

November 20, 2014
The Nicholas Institute for Environmental Policy Solutions at Duke University

The Nicholas Institute for Environmental Policy Solutions at Duke University

Editor’s Note: In observance of the Thanksgiving holiday, The Climate Post will not circulate next week. It will return on December 4.

The International Energy Agency (IEA) has released its World Energy Outlook (WEO) 2014 report, which for the first time provides energy trend projections through the year 2040. Among the key challenges in the next two and a half decades is, a 37 percent rise in global energy demand, driven mainly by emerging markets in Asia, Africa, the Middle East and Latin America. Asia will account for 60 percent of global growth in demand, and by early 2030s, China may surpass the U.S. as the world’s largest oil consumer.

“The short-term picture of a well-supplied oil market should not disguise the challenges that lie ahead as reliance grows on a relatively small number of producers,” according to the WEO report.

The IEA projects that global oil consumption will rise from 90 million barrels a day in 2013 to 104 million barrels a day in 2040, requiring a $900 billion investment in oil and gas development by the 2030s.

Overall use of coal is projected to decrease slowly in demand, while use of renewable energy from wind, solar and hydropower will grow. The IEA anticipates renewables will saturate one-third of global energy demand by 2040.

CO2 emissions are expected to grow by one-fifth by 2040, which puts the world’s temperature well on track to rise to 3.6 degrees Celsius by the end of this century, increasing the risk of droughts, rising sea levels, damaging storms and mudslides.

According to IEA projections, limiting global temperature rise to 2 degrees Celsius deemed by U.N. as the level necessary to avoid dangerous changes would require the world to ramp up low-carbon energy investments by four times their current levels—bringing annual global investment up to approximately $1 trillion.

On the domestic front, a majority of Americans support stricter regulations on carbon emissions, according to a new poll by Yale’s Project on Climate Communication. Further, two thirds of those polled (1,275 adults) support limits on carbon dioxide emissions even after being told such measures would raise power prices.

U.S. Pledges $3 Billion to UN’s Green Climate Fund

On the heels of its climate deal with China, the U.S. announced its intent to contribute $3 billion to the United Nation’s Green Climate Fund, which was established in 2013 to provide support to developing countries in reducing greenhouse gas emissions. The “game-changing pledge,” made by President Obama on the eve of the G-20 Summit in Brisbane, Australia, last week, makes the U.S. the fund’s largest contributor. The Obama administration has not specified whether its pledge will come from existing sources of funding or new appropriations from Congress—a strategy that could face stiff resistance from Republican lawmakers.

“The contribution by the U.S. will have a direct impact on mobilizing contributions from the other large economies,” said Hela Cheikhrouhou, executive director of the Green Climate Fund. “The other large economies—Japan, the U.K.—have been watching to see what the U.S. will do.”

It did not take long for Japan to follow suit with a $1.5 billion pledge to the fund. To date, the U.N. has received pledges from 13 countries totaling $7.5 billion—three-quarters of its $10 billion goal. Rich countries meet in Berlin to further discuss the 2014 goal where pledges reached $9.3 billion.

Panel Approves Rules for Unconventional Oil and Gas

After several years of heated debate, the North Carolina Mining and Energy Commission approved a detailed list of regulations to guide companies interested in securing unconventional oil and gas permits in the state. The rules were unanimously approved by commission members after review of approximately 217,000 public comments by 30,000 groups and individuals.

One of the rules revised by the commission in light of those comments calls for inclusion of leak detection systems and continuous monitoring of liners for open pits where fluids such as drilling waste are stored.

The approved regulations will be reviewed in December by the NC Rules Review Commission and in January by the state legislature. The commission has identified a number of areas for continued work, including authority to stop a company’s work.

“Just because we don’t have that stop-work authority doesn’t mean we can’t stop the work on site,” said Amy Pickle, vice chair of the commission and director of the State Policy Program at Duke University’s Nicholas Institute for Environmental Policy Solutions. “If something is going wrong, there’s injunctive authority, there is the ability to go to court to require them to stop working, there’s an ability through inspections and monitoring to revoke that permit.”

Across the country, unconventional oil and gas issues continue to be highly polarizing, as measures passed during mid-term elections revealed. A development ban was passed by the town of Denton, the Texas city where the earliest exploration began. In a compromise plan, limited development was approved by the U.S. Forest Service for the George Washington National Forest in Virginia. A 2011 plan draft would have allowed drilling in much of the forest’s 1.1 million acres.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.


As Eurozone Crisis Deepens, Fight to Save Emissions Trading Scheme Begins

December 22, 2011

The Nicholas Institute for Environmental Policy Solutions at Duke University

Editor’s Note: The Climate Post will not be circulated next Thursday in observance of the holiday. Look for it again on January 5.

Prices in Europe’s carbon emissions trading scheme have collapsed this year, in part because there were too many allowances in the system starting off, threatening the future of the whole market.

“Without intervention … Europe’s climate policy is over,” one analyst said. Some of Europe’s biggest energy and manufacturing firms also wrote a letter to the European Commission that called for Europe to take “decisive action now” to raise the price of carbon and fix the scheme.

The European Parliament’s environment committee voted in favor of temporarily cutting the number of emissions permits to be issued.

This year, the price of permits has fallen about 50 percent. Emissions allowances are now about 6 euros per ton—a four-year low, and about half what they were when the market began. Denmark, which will take over the presidency of the European Union in 2012, said the current carbon prices are “not sustainable” and vowed to help fix the problem.

Part of the problem is that Europe’s economic crisis is escalating, risking a slump like in the 1930s to which no country will be immune, said Christine Lagarde, managing director of the International Monetary Fund, in a speech at the U.S. State Department. Also, a new energy efficiency effort could also cut the number of permits needed, another reason to issue less in the future.

Paving the Way for De-carbonized Energy

The European Commission presented its long-awaited “Energy Roadmap 2050,” aiming to point the way to meet the European Union (EU) goal of cutting emissions at least 80 percent below 1990 levels by 2050.

The report considered various ways of reaching these targets, and concluded that relying heavily on renewables would be no more expensive than boosting nuclear, or fossil fuels along with carbon capture and storage.

A de-carbonized energy system could be cheaper than “business-as-usual,” although de-carbonization would require large up-front spending. The report also said natural gas will be a “critical” fuel during the transition.

The EU soon needs to set renewable energy targets for 2030, said EU Energy Commissioner Günther Oettinger.

Pollution Crackdowns

The European Union moved earlier this year to expand its emissions trading scheme to include flights in and out of Europe, and now the European Court of Justice has backed that law despite protests from the U.S. and others. The new decision, which goes into effect Jan. 1, may trigger a trade war.

Meanwhile, the U.S. Environmental Protection agency unveiled its first limits on emissions of mercury and several other toxic pollutants from power plants. The limits were 20 years in the making, and cover a variety of toxic compounds including arsenic, nickel, selenium, and cyanide.

The new standard gives companies three options: install systems to scrub their emissions, switch to natural gas, or shut down their plants. Some of the nation’s oldest—and generally dirtiest—coal-fired power plants may be forced to shut down, which could also benefit the climate.

Climategate Investigation Widened

The U.S. Department of Justice is apparently working with law enforcement officials in Britain to investigate who leaked climate researchers’ e-mails.

In the U.K., police raided the home of one climate skeptic blogger and confiscated two of his computers.

Flipping the Switch on Incandescents

A ban on the sale of incandescent light bulbs of 100 watts or more in the U.S. is supposed to go into effect Jan. 1, but an emergency spending agreement in Congress removed funds from enforcement of the ban, at least until October 2012. Experts say the lack of enforcement will likely have little effect, since light bulb manufacturers have already retooled and moved on.

The Climate Post offers a rundown of the week in climate and energy news. It is produced each Thursday by Duke University’s Nicholas Institute for Environmental Policy Solutions.

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