IRENA Urges $131-Trillion Investment through 2050 to Hit 1.5°C Target
Countries will have to speed up renewable energy development eight-fold, invest US$131 trillion by 2050, and massively ramp up hydrogen production to meet a 1.5°C target under the 2015 Paris Agreement, the International Renewable Energy Agency (IRENA) concludes this week, in the latest edition of its annual World Energy Transitions Outlook.
“Proven technologies for a net-zero energy system already largely exist today,” IRENA states in its summary of key findings. “In anticipation of the coming energy transition, financial markets and investors are already directing capital away from fossil fuels and towards other energy technologies including renewables.”
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However, “energy transition investment will have to increase by 30% over planned investment to a total of US$131 trillion between now and 2050, corresponding to $4.4 trillion on average every year,” the agency adds. And “national social and economic policies will play fundamental roles in delivering the energy transition at the speed required to restrict global warming to 1.5°C.”
The Abu Dhabi-based agency says the transition will depend on a “combination of technologies”, including energy efficiency, power system decarbonization dominated by renewables, wider electrification of buildings, industry, and transport, increased production of green hydrogen, synthetic fuels, and feedstocks, and “targeted use of sustainably-source biomass”.
So far, though, “the recent trends show that the gap between where we are and where we should be is not decreasing but widening,” warned IRENA Director General Francesco La Camera. “We need a drastic acceleration of energy transitions to make a meaningful turnaround. Time will be the most important variable to measure our efforts.”
To keep average global warming to 1.5°C above pre-industrial levels, the report concludes that fossil fuel consumption will have to fall by more than 75% by 2050 and fossil gas consumption must peak in 2025, Reuters reports.
“Renewable power capacity will have to expand more than ten-fold by mid-century, accompanied by a 30-fold increase in the electrification of transport,” the news agency adds, citing the outlook report. IRENA “also foresaw a dramatic increase in the production and use of ‘green hydrogen’—a zero-carbon fuel made by electrolysis, using power from wind and solar, that splits water into hydrogen and oxygen.”
The scenario shows 30% of electricity production in 2050 devoted to hydrogen and its derivatives, e-ammonia and e-methanol, with global electrolyzer capacity growing from 300 megawatts today to 5,000 gigawatts by mid-century.
It also has electricity growing to just over half of global energy consumption in 2050, compared to 21% in 2018, The Guardian says.
“The agency believes the world had already passed its peak oil demand before the slump in the market for transport fuels during the coronavirus pandemic, and gas should peak within the next three years,” The Guardian explains. “IRENA’s scenario is in stark contrast to the future modelled by the oil and gas giant Shell, which predicts that demand for gas will continue to climb until the mid-2030s at the earliest before beginning to decline.”