IEA: Net Zero Still Achievable If The World Slashes Fossil Fuel Demand

• The growth in clean energy is keeping hopes of limiting global warming to 1.5 degrees Celsius alive, according to the IEA.
• The IEA highlighted record growth in solar power capacity and electric car sales as two key factors keeping its net-zero emissions goal achievable.
• The updated net zero scenario has a policy-driven ramping up of clean energy capacity pushing fossil fuel demand 35% lower than in 2022.

The world could curb the rise in global temperatures if a huge ramp-up of clean energy capacity slashes fossil fuel demand by 25% by 2030, the International Energy Agency (IEA) said on Tuesday in an updated edition of its Net Zero Roadmap report from 2021.

The initial report was criticized by major fossil fuel producers and exporters for suggesting that in the IEA’s pathway to net-zero emissions by 2050, the world would not need new oil and gas projects beyond those sanctioned as of 2021.   

Two years after the first report, the new edition of the Net-Zero Roadmap says that the path to limiting global warming to 1.5 degrees Celsius has narrowed, but the surge in clean energy deployment keeps it open, the IEA said.

Along with the “extraordinary growth in some clean energy technologies” – such as solar power capacity and electric car sales – the IEA noted that since 2021 the world has also seen “increased investment in fossil fuels and stubbornly high emissions.”   

In the updated net-zero scenario, the IEA expects that a surge in clean energy capacity could push fossil fuel demand down by 25% by 2030, reducing emissions by 35% compared with the all-time high in 2022. The IEA’s scenario also envisages fossil fuel demand falling by 80% by 2050.

“As a result, no new long-lead-time upstream oil and gas projects are needed. Neither are new coal mines, mine extensions or new unabated coal plants,” the agency said today, but noted that “continued investment is required in some existing oil and gas assets and already approved projects.”

The IEA warned, however, that clean energy expansion needs to match any falls in fossil fuel investment to avoid price spikes.  

“Prolonged high prices would result if the decline in fossil fuel investment in this scenario were to precede the expansion of clean energy and the action to cut overall energy demand that are also set out in this scenario,” it said.

The energy transition may not be smooth, the IEA also warned.

“The NZE Scenario charts an orderly process of change, but this is far from guaranteed in practice,” the agency noted.

Earlier this month, the IEA was rebuked by OPEC for claiming that oil and gas demand would peak this decade and for calling the “beginning of the end of fossil fuels.”

By Tsvetana Paraskova for Oilprice.com

More Top Reads from Oilprice.com:

• Goldman Sachs Ignores Activist Call To Abandon Oil And Gas
• Oil Demand Destruction In India Won’t Happen At $100 Per Barrel
• Energy Fund Manager Predicts Major Upside For Oil Equities