COVID-19 recovery packages have largely focused on protecting, rather than transforming, existing industries, and have been a “lost opportunity” for speeding up the global energy transition.
That is according to analysis by energy consultancy DNV, which also found that the world will fall “a long way short” of hitting net-zero emissions by 2050 if it relies on green electricity alone.
Although electrification is set to double in size within a generation, and renewables are already the most cost-competitive source of new power, the company said that the energy transition is still “definitely not fast enough”.
It forecasts global emissions to fall by only 9% by 2030, with the 1.5°C carbon budget agreed by global economies emptied by then, and the planet likely to reach global warming of 2.3°C by the end of the century.
Despite the grim outlook, the analysis suggests that the goals of the Paris Agreement can still be delivered, with energy efficiency remaining the biggest opportunity for tackling climate change.
DNV CEO Remi Eriksen said that, although COVID-19 has been a lost opportunity, “it is not the last we have for transitioning faster to a deeply decarbonised energy system. However, I am deeply concerned about what it will take for governments to apply the resolution and urgency they have shown in the face of the pandemic to our climate. We must now see the same sense of urgency to avoid a climate catastrophe.”
The findings show that greater efficiency could see energy demand level off even as the global population and economy grow. Hydrogen is seen as the energy carrier with the highest potential to tackle hard-to-abate emissions, but this is forecast to scale only from the mid-2030s, and to supply just 5% of the energy mix by 2050.
Oil demand looks set to halve, with coal use reduced to a third by mid-century, although fossil fuels are still expected to still constitute 50% of the global energy mix.
The analysis also suggests that, while 69% of grid-connected power will be generated by wind and solar in 2050, and indirect electrification and biofuels remain critical, none of these sources are scaling rapidly enough. DNV said that this makes it all the more important to scale hydrogen, as well as carbon capture and storage.
“Extraordinary action will be needed to bring the hydrogen economy into full force earlier – but these are extraordinary times,” Eriksen said. “The window to avoid catastrophic climate change is closing soon, and the costs of not doing so unimaginable.”
Read the full analysis at bit.ly/DNV_EnergyTrans