ECONOMY

The World’s Top Energy Agency Reckons With Net-Zero Emissions

Ours is a global society accustomed to eternal debate and marginal change distributed over many years. But it won’t do in the era of climate change.

That’s the message of the International Energy Agency’s “Net Zero by 2050” report. The energy transition, the historically staid body says, is an all-hands-on-deck crisis that “hinges on a singular, unwavering focus from all governments—working together with one another, and with businesses, investors and citizens.”

The report is chock full of numbers. Reaching the net-zero target, according to IEA modeling, starts with spending $820 billion on electric grids annually by 2030. Increasing the number of charging points for electric vehicles to 40 million in the coming decade from 1 million today. Building 20 giga-factories churning out lithium-ion batteries every year for the next decade. And so on.

To understand the full implications of the IEA’s report, however, it’s worth focusing on the words. “It’s not a model result,” said Dave Jones, an analyst at clean energy think tank Ember. “It’s a call to action.”

Consider this sentence, taken from a passage about the serious security implications for those currently reliant on fossil-fuel production: “No new oil and natural gas fields are needed in our pathway, and oil and natural gas supplies become increasingly concentrated in a small number of low-cost producers.”

“In our pathway” is carrying a lot of water in this sentence. It’s a pathway designed to conform to what scientists say, based on decades of evidence, are actions necessary to avoid civilization-scale catastrophes that await as the planet warms beyond 1.5º Celsius. It’s also a pathway designed to ensure, according to the IEA’s mandate, “secure and affordable energy supplies to foster economic growth.”

The IEA’s results are a stunning break from both recent work that fell short of envisioning a net-zero world and its half-century mission to maintain stability in fossil-fuel energy markets. “The way we see this scenario is that it’s a very, very narrow pathway,” said Laura Cozzi, the IEA’s chief energy modeler, “but it’s still feasible.”

This mandate must be balanced with economic danger to oil-and-gas producing nations and companies from shutting down fossil fuels. Jobs can vaporize and tax receipts plummet. Energy supply and demand, after all, shaped the 20th century political order.

There’s also the risk that betting on certain technologies might mean creating other problems—the demand for bioenergy may compete with food production, for instance. Among the many constraints IEA chose for its model, it left out relying on controversial forestry offsets.

Reducing emissions is also about optimizing the speed of change and the preservation of stability where possible. Climate change was already becoming more invasive, with its more intense heatwaves, storms, and floods. Now, the IEA warns, transforming the energy system must be front-of-mind for every region, nation, city, company, and household—a need as basic as protecting citizenry, paying employees, feeding kids—but also to swap out the energy system humming in the background.

Getting to this point, however, has not been easy. For years, environmental groups and climate activists have been demanding the IEA produce a full-scale pathway for getting to net zero by 2050. As an agency that only answers to ministers of rich countries, it’s had to wait until the majority of its members committed to that goal, with the U.S.—the IEA’s biggest funder—joining the list last month.

While there’s no dearth of energy models showing how the world reaches climate goals, few have the reach and influence that IEA’s models do. They shape decisions made by governments from New Delhi to Washington. They inform investors in London and Cape Town. The net-zero scenario is expected to be a part of all major reports IEA publishes in the future, which means we’ll continue to see the stunning gap between where the world is and where it needs to be.

Crucially, as Jones puts it, the IEA’s report isn’t just a “black-box modeling exercise” but one that comes with hundreds of milestones on the way to net zero: no coal power plants after 2021, no internal-combustion engine sales from 2035, no emissions from electricity before 2040 and so on. 

The next step will see analysts translating the IEA’s global analysis into country-level and company-level goals. “How many of them are impossible? I’m not really sure,” said Jones. It’s clear, however, that “we’re massively off track, and we need some real injection of action.”

Written with Eric Roston. Akshat Rathi writes the Net Zero newsletter, which examines the world’s race to cut emissions through the lens of business, science, and technology.

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