IEA Presses for Climate Change

Seventy-four years after the British engineer Guy Stewart Callendar first attributed climate change to human activity, and 24 years after it became widely discussed publicly, the International Energy Agency has for the first time opened exploratory discussions with companies on the issue.

Last week, the 28-member nation IEA announced that a select group of companies from the energy and manufacturing sectors met to discuss the threat to energy systems from climate change.

“The meeting, which had been scheduled for several months, comes a week after Hurricane Sandy caused tens of billions of dollars worth of damage along the East Coast of the United States,” the IEA said n a prepared release. “The storm's aftermath highlighted the vulnerability of even the most well-developed economies and energy systems to environmental impacts.”

The IEA was established in the wake of the 1973-1974 OPEC with the mission of helping countries coordinate a collective response to major oil supply disruptions through the release of emergency oil stocks to the markets. Since that time, it has expanded to play a major role in the global dialogue on energy.

Despite seemingly convening the group of companies belatedly, the IEA has been growing increasingly concerned about climate change. Earlier this year, the organization issued its Energy Technology Perspectives for 2012, saying there is still a chance that a technological transformation of the energy system could make it possible to reduce dependency on imported fossil fuels or on limited domestic resources, decarbonize electricity, enhance energy efficiency and reduce emissions in the industry, transport and buildings sectors.

But the report said, to do so clean energy investment must double by 2020, requiring a staggering US$36 trillion across the globe –35 percent more in investment from today to 2050 than under a scenario in which controlling carbon emissions is not a priority.

That, the report said, is the equivalent of an extra US$130 per person every year. However, the fuel savings by 2025 would outweigh the investments and by 2050 would amount to more than US$100 trillion. Even if these potential future savings are discounted at 10 percent, US$5 trillion in net savings would accrue between now and 2050.

The question is whether any of this is possible given today’s global political priorities. Despite the hammer blow to the back of the head of the Republican Party in the United States that was delivered first by Hurricane Sandy, then by the reelection of President Barack Obama and the defeat of global warming detractors in the US Senate, the commitment to spend the money up front appears to be lacking across the planet.

For instance, although the Kyoto Protocol on climate change was adopted in 1997 – 15 years ago – and signed by 191 member states, the United States, the world’s biggest emitter of greenhouse gases, refused to sign. Canada has since withdrawn. And while of the signatories have committed themselves to reduce or limit emissions of carbon dioxide, methane, nitrous oxide and sulphur hexafluoride, very little progress has been made. Subsequent attempts at coming to agreement in Copenhagen and other sites have simply collapsed.

The Energy Technologies Perspective report itself points out that nine of the 10 technologies that could be brought to bear for energy and CO2 emissions savings “are failing to meet the deployment objectives needed to achieve the necessary transition to a low-carbon future.”

In fact, some of the technologies with the largest potential are showing the least progress, the report notes, calling it a “bleak picture.” Only a handful of renewable energy technologies including hydropower, biomass, onshore wind and solar photovoltaics are making sufficient progress, the report continues. Other key technologies for energy and CO2 emission savings are lagging behind.

In particular, perhaps the most important of these technologies – the ones that allow for the saving of energy – are falling behind. That includes lack of progress in carbon capture and storage (CCS) and, to a lesser extent, of off shore wind and concentrated solar power (CSP).

“The scale-up of projects using these technologies over the next decade is critical. CCS could account for up to 20% of cumulative CO2 reductions in the 2DS by 2050. This requires rapid deployment of CCS and is a significant challenge since there are no large-scale CCS demonstrations in electricity generation and few in industry.”

Committed government funds are inadequate and are not being allocated to projects at the rates required. In transport, government targets for electric vehicles are set at 20 million vehicles on the roads in 2020. In the United States, these funds are being actively blocked in the US Congress by global warming skeptics, backed by energy companies.

With the debilitating global economic recession continuing, there are few countries that can afford to take on scaling up the technologies. While current targets are encouraging, the report notes, they are more than twice the current industry planned capacity.

"Much has been said about the ways in which our energy system is affecting the climate, yet very little has been said about the opposite: the effects of a changing climate on our energy system,” said IEA Executive Director Maria van der Hoeven, who participated in the talks. "As the IEA's core mission is enhancing energy security, we think it's imperative to jump-start a conversation about this issue. Our discussions showed that active dialogue between industry and governments around this issue can improve our future resilience to climate impacts."

The IEA Secretariat will host additional forums as an opportunity for businesses and governments to exchange views and experience, will establish a database of policies that enhance resilience of the energy sector as a platform for countries to share experience and will incorporate into its model-based projections more analysis regarding the potential impact of climate change on energy supply and demand.

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