Energy sector revamp

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Context: The United Nation’s climate science body, the Intergovernmental Panel on Climate Change (IPCC) published the third installment of its Sixth Assessment Report (AR6).

• The report prepared by the IPCC Working Group III (WG-III) focuses on the mitigation of climate change (solutions necessary to halt global warming).
• It collates the latest scientific research from across the world and extends to thousands of pages.
• Consortium of scientists as part of the Intergovernmental Panel on Climate Change (IPCC) said limiting global warming will require major transitions in the energy sector and this mean drastically reducing fossil fuel use, widespread electrification, improved energy efficiency, and the use of alternative fuels.

Key highlights from the Report:

1. Greenhouse gas (GHG) emissions growth is slowing

• In 2019, global net anthropogenic GHG emissions were at 59 gigatonnes of carbon dioxide equivalent (GtCO2e), 54 per cent higher than in 1990.
  • Net emissions refer to emissions accounted for after deducting emissions soaked up by the world’s forests and oceans.
  • Anthropogenic emissions refer to emissions that originate from human-driven activities like the burning of coal for energy or cutting of forests.
• This emissions growth has been driven mainly by CO2 emissions from the burning of fossil fuels and the industrial sector, as well as methane emissions.
• Average annual rate of growth slowed to 1.3 per cent per year in the period 2010-19, compared to 2.1 per cent per year in the period 2000-09.
• At least 18 countries have reduced GHG emissions for longer than 10 years on a continuous basis due to decarbonisation of their energy system, energy efficiency measures and reduced energy demand.

2. Least developed countries emitted only 3.3 per cent of global emissions in 2019

• Carbon inequality remains pervasive as ever with Least Developed Countries (LDCs) emitting only 3.3 per cent of global emissions in 2019. Their average per capita emissions in the period 1990-2019 were only 1.7 tonnes CO2e, compared to the global average of 6.9 tCO2e.
• LDCs contributed less than 0.4 per cent of total historical CO2 emissions from fossil fuels and industry in the period 1850-2019.
• Globally, 41 per cent of the world’s population lived in countries emitting less than 3 tCO2e per capita in 2019.

3. Pledges to the Paris Agreement are insufficient, emissions must fall 43 per cent by 2030 compared to 2019

• Upon adding up the NDCs announced by countries till October 2021, the IPCC finds that warming will exceed 1.5 degrees Celsius (°C) in this century, thereby failing the Paris Agreement’s mandate.
  • Current pledges made by countries who have signed the Paris Agreement are known as Nationally Determined Contributions (NDCs).
• The CO2 emissions from existing and planned fossil fuel infrastructure — coal, oil, and gas — contribute greatly to this projected failure.
• In its best-case scenario, known as the C1 pathway, the IPCC outlines what the world needs to do to limit temperatures to 1.5°C, with limited or no ‘overshoot’.
  • Overshoot refers to global temperatures crossing the 1.5°C threshold temporarily, but then being brought back down using technologies that suck CO2 out of the atmosphere.
• To achieve the C1 pathway, global GHG emissions must fall by 43 per cent by 2030 compared to 2019 levels, amounting to 31 GtCO2e in 2030. And the use of coal, oil, and gas must decline by 95 per cent, 60 per cent and 45 per cent by 2050 compared to 2019.
• Methane reduction: Limiting warming to around 1.5°C requires global greenhouse gas emissions to peak before 2025 at the latest and be reduced by 43% by 2030; at the same time, methane would also need to be reduced by about a third.

4. Abundant and affordable solutions exist across sectors including energy, buildings, and transport, as well as individual behavioural changes

• Widespread ‘system transformations’ are required across the energy, buildings, transport, land and other sectors, to achieve the 1.5°C target.
• This involves adopting low-emission or zero carbon pathways of development in each sector. But solutions are available at affordable costs.
• The costs of low emissions technologies have fallen continuously since 2010. On a unit costs basis, solar energy has dropped 85 per cent, wind by 55 per cent, and lithium-ion batteries by 85 per cent.
• Their deployment, or usage, has increased multiple fold since 2010 — 10 times for solar and 100 times for electric vehicles.
• The IPCC report attributes this success to “public R&D, funding for demonstration and pilot projects and demand-pull instruments such as deployment subsidies to attain scale”.
• The report states that “several mitigation options, notably solar energy, wind energy, electrification of urban systems, urban green infrastructure, energy efficiency, demand side management, improved forest — and crop / grassland management and reduced food waste and loss, are technically viable, are becoming increasingly cost effective and are generally supported by the public.
• Solutions outlined by report:
  • Reducing fossil fuel use in the energy sector, demand management and energy efficiency in the industrial sector and adopting the principles of ‘sufficiency’ and efficiency in the construction of buildings.
  • Demand-side mitigation, ie, behavioural changes such as adopting plant-based diets, or shifting to walking and cycling “can reduce global GHG emissions in end use sectors by 40-70 per cent by 2050 compared to baseline scenarios” and improve wellbeing.

5. Impact on GDP would be negligible and the long-term benefits of cutting emissions immediately would outweigh the initial costs

• The IPCC states that low-cost climate mitigation options, ie, those costing $100 per tCO2e or less, could halve global GHG emissions by 2030.
• Long-term benefits of limiting warming far outweigh the costs.
• Investing in decarbonisation would have a minimal impact on global Gross Domestic Product (GDP).

6. Finance falls short, but there is sufficient money in the world to close this gap

• Financial flows fall short of the levels needed to achieve the ambitious mitigation goals.
• The gaps are the widest for the agriculture, forestry, and other land uses (AFOLU) sector and for developing countries.
• Global financial system is large enough and “sufficient global capital and liquidity” exist to close these gaps.
• For developing countries, it recommends
  • scaled up public grants, as well as “increased levels of public finance and publicly mobilised private finance flows from developed to developing countries in the context of the $100 billion-a-year goal;
  • increase the use of public guarantees to reduce risks and leverage private flows at lower cost;
  • local capital markets development and building greater trust in international cooperation processes.

India specific recommendations:

• India in particular had demands on climate finance, while Saudi Arabia wanted to see a continued role for fossil fuels like oil and gas.
• An aspect of the report, of particular relevance to India, is that there is no place for new coal plants. The panel finds that all coal-fired power plants, without the technology to capture and store carbon (CCS), need to be shuttered by 2050 if the world aspired to limit global temperature rise to 1.5c.
• According to the Central Electricity Authority, India has about 211 GW of operational coal-fired power plants — roughly 10% of global capacity.
• As per Global Energy Monitor data, another 31 GW was being constructed and about 24 GW in various pre-construction phases. None of the existing under construction coal-fired power plants in India have CCS facilities.
• India has committed to net-zero year, or when it would cease to be a net carbon dioxide emitter, of 2070 and has defined a pathway to transition to renewable energy sources but also insisted on its right to coal use given its developmental needs as well underlining that the historical responsibility of climate change from fossil fuel rested with the developed countries.

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