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‘Kaliyuga’ of climate change preventable

According to International Energy Agency’s flagship study of World Energy Outlook for 2017, the energy industry is on the brink of a seismic shift. Energy demand is projected to increase even while we must de-carbonise the energy sector to prevent global warming. IEA has taken recourse to scenario analysis.  Three main scenarios are Current Policies (CP), New Policies (NP) and Sustainable Development (SD). 

CP scenario considers only those policies firmly enacted as of mid- 2017. NP scenario describes where existing policies might lead the energy system. SD scenario outlines an integrated approach to achieve the energy-related aspects of the UN sustainable development goals. 

In the WEO-2017, global GDP is assumed to grow at 3.4 per cent per year. The world population is assumed to rise from 7.4 billion in 2016 to 9.1 billion in 2040. For the global economy as a whole, as of 2016, a 1 per cent rise in GDP is associated with a 0.3 per cent increase in primary energy demand. 

The Table gives world energy demand for three scenarios. Under NP, energy demand will increase to 17,584 million tons of oil equivalent (Mtoe) whereas it will be 14,804 Mtoe under SD scenario. Is this possible to accomplish when energy demand has been growing at a far higher rate? The largest contribution to demand growth- almost 30 per cent – comes from India in the NP scenario. 

Table-2 gives projection of oil demand for three scenarios. While oil demand increases under CP and NP scenarios, it decreases under the ambitious SD scenario. While there is much discussion about peak oil demand occurring before 2025 to 2030, NP does not see it taking place before 2040. 

Compared with the past twenty-five years, the way that the world meets its growing energy needs changes drama-tically in NP Scenario, with the lead now taken by natural gas. Renewables capture two-thirds of global investment in power plants as they become, for many countries, the least-cost source of new generation. 

 

US will emerge net exporter...

One of the most startling revelation of WEO 2017 is the continuing impact of shale revolution in the US. By the mid-2020s, the US will become the world’s largest LNG exporter and a few years later a net exporter of light crude and refined products. In the SD scenario, low-carbon sources double their share in the energy mix to 40 per cent in 2040, all avenues to improve efficiency are pursued, coal demand goes into an immediate decline and oil consumption peaks soon thereafter. To achieve this, the power sector is all but decarbonised. Electrical vehicles(EVs) move into mainstream, larger efficiency in industry, transportation, etc. 

Only one of the three main scenarios sees a decline in global energy-related CO2 emissions over the period to 2040: this is the SD scenario (see Table). There is some decline in CO2 emissions under NP compared to CP. But this is not at all adequate to comply with the Paris agreement. Unfortunately IEA does not use the report to convey the urgency to world community to bring about radical changes in energy sector. 

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