IRENA: Existing solutions can spur progress to net-zero
Global power sourced from renewables is set to treble by 2050, with wind, solar and hydrogen all required to account for 90% of all decarbonisation solutions to push the global economy towards the 1.5C pathway, a new report from the International Renewable Energy Agency (IRENA) has found.
IRENA’s Outlook report proposes energy transition solutions required to limit global average temperature increase to 1.5C, as envisioned by the Paris Agreement. The report notes that many of the solutions required to deliver this transition already exist.
Up to 90% of the decarbonisation solutions to meet this goal will come from renewable energy, the report finds. Carbon capture and removal technologies, alongside bioenergy solutions, will also be critical in delivering “last mile” carbon reductions that help create a net-zero energy system.
Reaching this net-zero pathway would see power sourced from renewables treble by 2050. At the same time, fossil fuels will decline by more than 75%, with natural gas use also peaking in the next four years.
Renewable power capacity is expected to expand more than ten-fold over the same period, while transport is expected to experience a 30-fold increase in electrification, the highest of any sector. Around 70% of carbon emissions from the transport sector will come from direct and indirect electrification.
With energy giants currently attempting to halve the costs of green hydrogen by 2026, the technology will emerge as one of the major demands for electricity – accounting for 30% of total consumption by 2050. However, hydrogen will be one of the crucial drivers in the decarbonisation of the energy system.
IRENA’s director-general Francesco La Camera said: “The window of opportunity to achieve the 1.5C Paris Agreement goal is closing fast. The recent trends show that the gap between where we are and where we should be is not decreasing but widening. We are heading in the wrong direction.
“While the pathway is daunting, several favourable elements can make it achievable. Major economies accounting for over half of global CO2 emissions are turning carbon neutral. Global capital is moving too. We see financial markets and investors shifting capital into sustainable assets. Covid-19 has highlighted the cost of tying economies to fossil fuels and confirmed the resilience of renewable energy. As governments pump huge sums in bailouts and recovery, investment must support energy transition. It is time to act and countries can lead the way with policies for a climate-safe, prosperous and just energy system fit for the 21st century.”
La Camera’s warning is built on the report’s findings that planned investment into energy solutions will need to increase by 30% to more than $131trn by 2050 – equitable to $4.4trn annually.
While investors are already angling towards low-carbon solutions, with shares of the energy sector in the S&P falling to 3% today, more will need to be done to create financial markets for green solutions. The report notes that renewable energy stocks in the S&P rose by 138% last year.
However, IRENA notes that major economies have responded to the coronavirus pandemic by funnelling around $4.6trn into carbon-heavy sectors such as agriculture, energy and transport. In contrast, around $1.8trn has gone into green sectors.