A roadmap toward Net Zero by 2050
A large number of nations and companies are expressing their intention or commitment to achieve climate neutrality within a few decades.
The awareness of the risks associated with inaction with respect to climate change is supporting this drive.
Moreover, there is a clear trend in the market to privilege and valorise products and services that respect the principles of sustainability, not only from an economic point of view but also and mainly from an environmental and social perspectives.
However, the problem arises with respect to how to achieve this transition, and how to pass from good intentions to concrete actions.
To help both political and corporate decision makers, the IEA (International Energy Agency) has now started to address the topic. The IEA, in fact, published its first report on May 18, presented as one of the most important documents ever produced in its history. This report focuses on the achievement of climate neutrality in the energy sector by 2050 worldwide, structured to be consistent with maintaining global warming within + 1.5 ° C by 2100.
The exceptional nature of the document is because the IEA is the best set up organization with the largest database to carry out such complex analysis that inevitably has economic and social implications as it deals with energy issues.
The report is long and detailed, and focuses on what must happen and above all on when it must happen in order to achieve the climate goals.
In the continuation of this article, we want to report a summary of the main points.
It is possible, but we must take action now
Achieving climate neutrality by 2050 is theoretically possible but involves a very narrow path, which only immediate and courageous actions by policy makers can achieve.
Such actions also need to be coordinated and to see an unprecedented level of worldwide collaboration. In fact, it must be acknowledged that each country starts from different conditions and no one can be left behind in the challenge to climate change.
We should deploy all the already available technologies
A massive deployment of the already available technologies is essential from now on to 2030. These are mainly related to solar photovoltaics, wind, energy efficiency and electric vehicles.
For example, in 2020 compared to 2030 solar and wind power must increase the annual installed capacity by 4 times, the sales of electric cars must increase by 18 times and 1 in 5 buildings needs to be renovated for the purpose of energy efficiency.
At the same time, it is also essential to develop the infrastructure necessary for the transition, in particular with a major expansion of the electricity grid.
The IEA estimates that around 50% of emissions reductions by 2050 will come from technologies that already exist and are available on the market.
We should take advantage of the next few years to develop the solutions that we do not have but that we will need
It is necessary to invest from now to 2030 to develop technologies that are currently in the R&D phase and at the prototype level. These technologies will then have to be massively deployed from 2030 to 2050 to cover around 46% of the reduction in emissions.
The development of hydrogen as a new energy vector, the decarbonisation of industrial processes (mainly steel and cement), new solutions for trucks, airplanes and ships, everything related to the capture and storage of CO2 and technologies for removing carbon from the atmosphere are examples of areas in which invests will be required.
The order of magnitude of investments in new technologies from now to 2030 is estimated at approximately USD 90 billion.
Technology will not be enough
The remaining 4% of the reduction will have to come from behavioural changes.
The IEA reports some examples of changes to our lifestyle, such as maintaining a maximum temperature of 19-20 ° C in our houses during winter and a minimum of 24-25 ° C in the summer. A maximum speed of 100 km/h on the motorway and the replacement of short-distance flights by rail. Business and long-haul leisure flights in 2050 must not exceed the levels of 2019. The recycling of plastics will have to increase from 17% today to 54% by 2050.
A drastic decline in the use of fossil fuels
A drastic decline in the use of fossil fuels is needed. The decline will have to be so fast that investment in new oil wells, natural gas or coalmines is no longer necessary today.
Oil production will have to go from 90 mbd to 24 mbd by 2050 (-75%). The price will also drop and consequently all residual production will be concentrated in the Middle East, where production costs are lower. The OPEC countries will increase from today’s market share of 30% to over 50%.
The demand for natural gas will also drop, reducing by 55% compared to 2020 levels.
Countries whose stability and wealth depends primarily on fossil fuels must urgently work to diversify their economies.
Investments are the key to the transition
For all of this to happen, substantial growth in investments is required: today the energy world (80% linked to fossil fuels) sees global investments in clean technologies of approximately USD 1 trillion per year; these must rise to USD 4 trillion by 2030. This investment flow will produce an additional increase in world GDP of 0.4% per year to 2030.
The transition will create job opportunities
The transformation will create new job opportunities. Today around 40 million people work in the energy sector. The transition will lead to 14 million new job opportunities by 2030 (compared to about 5 million lost in the fossil fuel business). To these another 16 million job opportunities will be added related to the end-uses of energy (for example in construction sector and the extensive renovation of existing buildings).
We will have to face an energy security problem
There will be an energy security problem: in addition to the aforementioned example of oil, the extraction and transformation of the minerals necessary for the energy transition is now concentrated in a few countries, with a predominant role played by China.
On May 5, the IEA also published another important report aimed at highlighting the delicacy and crucial nature of the raw materials that will be critical for the electrification and decarbonisation of our society. Large quantities of copper, lithium, nickel, cobalt, manganese, graphite and rare earths will be essential to meet the demand from the production of batteries, electric motors and the expansion of the electrical infrastructure.
Electric cars contain about 6 times the amount of these materials compared to traditional cars, and an offshore wind turbine 13 times of a gas power plant of the same capacity. Overall, the volumes of minerals required will increase by 6 times by 2040, with even greater increases for specific materials. For example, the demand for lithium is expected to increase by more than 40 times.
It will be essential for the ecological transition that these minerals are made available in sufficient volumes and with stable and accessible prices, stemming as much as possible the risks associated with the concentration of the extraction and production chains in a very small number of countries.
Finally, the IEA suggests a path sketched with numerous milestones in order to help the various countries not only to develop strategies in the climate field but also to monitor over the years whether the initiatives undertaken are in line with the 2050 objectives.
For example, as of this year, in addition to not investing in new fossil fuel deposits, new coal plants can no longer be built. From 2035 it will no longer be possible to sell cars equipped with an internal combustion engine and from 2040 all electricity production will have to be climate neutral. Finally, in 2050 70% of electricity will come from solar photovoltaics and wind.
The one described by the IEA is naturally a possible scenario, that needs to be lowered into the specific reality of each country in order to define the best strategy and the intermediate steps precisely. However, the report clearly shows why the energy transition, and more generally the fight against climate change, is considered the greatest challenge ever faced by humanity.
But, as is well known, it is a game that humanity, for its own good, cannot afford to lose.
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