© OECD/IEA 2018

Tracking Clean Energy Progress (TCEP): Key trends in energy transitions

Caroline Lee, Energy Policy Analyst 6 December 2018 – COP24 – Polish Pavilion

2 © OECD/IEA 2018

IEA at COP24 – Key messages

• Paris Agreement goals are slipping out of reach - IEA estimates energy-related CO2 emissions will reach an historic high in 2018

- To meet Paris goals, CO2 emissions need to peak around 2020 and enter a steep decline

• The IEA Family of countries now covers almost 75% of global energy demand, so is ideally placed to help countries meet their energy objectives

• The IEA offers data, analysis and solutions across “All Fuels and All Technologies”

• IEA analysis is key to tracking progress of global energy transitions - Assessing progress on energy transitions, under the Talanoa Dialogue and beyond

- Helping to drive further NDC ambition

3 © OECD/IEA 2018

Global emissions are set to increase in 2018 - again The world is not moving towards the Paris goals, but rather away from them

Global energy-related CO2 emissions

Tracking Clean Energy Progress 2018 (TCEP): Historical data basis

CO2 emissions Increase in 2017

5

10

15

20

25

30

35 Gt CO2

4 © OECD/IEA 2018

TCEP 2018: SDS as a benchmark on where do we want to go

A wide variety of technologies are necessary to meet goals, with energy efficiency and renewables playing lead roles

Global energy-related CO2 emissions

16

20

24

28

32

36

2010 2020 2030 2040

Central Scenario

Sustainable Development Scenario

Efficiency

Renewables

Fuel-switching

CCS Other

Nuclear

44%

36%

2% 6% 9% 2%

Gt CO2

2

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TCEP 2018: How energy sectors can contribute to the decarbonisation effort

Cumulative emissions reductions between 2017 and 2040 for each sector in the SDS compared to the NPS, including indirect emissions.

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Tracking Clean Energy Progress 2018 www.iea.org/tcep

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Tracking Clean Energy Progress 2018 – Key High Level Indicators

8 © OECD/IEA 2018

Aggregate Indicators for Clean Energy Transitions

00.5

11.5

22.5

33.5

4

2000 2010 2020 2030 2040

MtCO

2/Mtoe

(TFC

)

Energy Sector Carbon Intensity

Historical SDS Targets

-4%

-3%

-2%

-1%

0%

1990-2013average 2014 2015 2016 2017

2018-2040average

annu

al c

hang

e in

ene

rgy

inte

nsity

Annual change 2017 SDS Target

Energy intensity

The world’s energy supply in 2017 was as carbon intensive as in 2000, it needs to decline by 47% by 2040; Global energy intensity improved by only 1.7% in 2017, but needs to accelerate to 3.4% annually.

9 © OECD/IEA 2018

Power sector sub-sectoral indicators

Generation from low-carbon technologies needs to increase to nearly two-thirds by 2030; the carbon intensity of power generation needs to more than halve by 2030

200

400

600

800

1 000

2000 2010 2020 2030

gCO

2/kW

h Power generation carbon intensity

India

SoutheastAsiaChina

World

UnitedstatesEuropeanUnion0%

10%

20%

30%

40%

50%

60%

70%

2000 2010 2020 2030

Share of new capacity additions Low carbon

Renewables

Total Plantsfitted with CCS

Coal

10 © OECD/IEA 2018

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Solar PV is the only renewable technology on track

Following another record year in 2017, solar PV continues to lead the expansion in renewable power, driven by unprecedented growth in China and strong deployment in the US and India

7

0

500

1 000

1 500

2 000

2 500

3 000

2000 2005 2010 2015 2020 2025 2030

TWh

Solar PV generation

12 © OECD/IEA 2018

Renewables growth is not fully on track for what is needed

Renewables saw highest rate of generation growth among all energy sources in 2017, but deployment must further speed up to meet 2030 targets and beyond

0

2000

4000

6000

8000

10000

12000

14000

16000

Renewables generation by technology

Ocean

Geothermal

CSP

Offshore wind

Bioenergy

Hydropower

Onshore wind

Solar PV

13 © OECD/IEA 2018

The number of passenger electric cars on the road passed 3 million in 2017, although they still represent just 0.3% of the global car fleet

The number of passenger electric cars on the road passed 3 million in 2017, but it needs to grow to 240 million by 2030 in the SDS

EV growth has grown rapidly; strong momentum needs to continue

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2013 2014 2015 2016 2017

mill

ions

Others

United States

Europe

China

Global electric car stock

0100200300400500600700800900

1000

2013 2014 2015 2016 2017 2030 2040

Elec

tric

car s

tock

(mill

ions

)

SDS Target

Others

United States

Europe

China

10

14 © OECD/IEA 2018

Transport biofuels are far from reaching their potential

Production of transport biofuels grew by 2% in 2017, but transport biofuels need to triple by 2030 to meet SDS

Transport biofuels production

0

50

100

150

200

250

300

2010 2012 2014 2016 2018 2020 2022 2025 SDS 2030 SDS

Mtoe

Forecast Historical

15 © OECD/IEA 2018

Cooling is driving electricity demand growth

Share of world electricity demand growth to 2050

Space cooling 21%

Appliances 15% Heating

7%

Other buildings 15%

Industry 32% Other 10%

Electricity demand for air conditioning could more than triple by 2050 – requiring as much new electricity capacity as all of the United States, EU and Japan today – but better policies could cut it in half

16 © OECD/IEA 2018

More than 70% of the $2 trillion required each year in energy supply investment either comes from state-directed entities or receives a full or partial revenue guarantee

Our energy destiny rests with governments

2018-2040 42.3 trillion dollars

Government-driven 70%

Market-driven 30%

Total investment in energy supply to 2040: $42.3 trillion

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The IEA works around the world to support accelerated clean energy transitions that are

enabled by real-world SOLUTIONS

supported by ANALYSIS

and built on DATA www.iea.org/COP24

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www.iea.org IEA

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The future of e-mobility extends to 2/3-wheelers, low speed vehicles, buses, trucks, and autonomous/connected/shared vehicles

Beyond electric cars: the future of e-mobility

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Energy storage lost its on track status and needs improvement

Additional utility-scale deployments for all storage technologies (excluding pumped hydro) remained flat in 2017 (620 MWh). This is insufficient to meet the SDS, which requires 80 GW of capacity additions by 2030.

Energy storage capacity

0

50

100

150

200

250

300

2010 2017 2020 2030

GW

Storage needed under SDS

Planned PSH

Non-PSH storage

Pumped Storage Hydropower (PSH)

22 © OECD/IEA 2018

Tracking Clean Energy Progress 2018 – Key High Level Indicators

3

CO2 Indicators

Aggregate energy sector CO2 emissions

Sub- sectoral CO2 emissions

Clean Energy transitions indicators framework

Aggregate indicators

Sub- sectoral indicators

Energy sector carbon intensity Electricity share of energy consumption

Primary energy intensity

Energy efficiency improvement rate Investment share of low carbon energy

Public and private investment in clean energy RD&D

Power sector (example) Share of low-carbon power generation in overall power generation

Average CO2 intensity of electricity generation CO2 intensity of power generation from new investments

Share of new low-carbon power generation investment in overall power generation investment

23 © OECD/IEA 2018

LED lighting is on track, thanks to government policy & innovation

LEDs are on track to dominate residential lighting by around 2020; 3.3 billion LEDs were installed in 2017, underpinned by falling costs & government policy

Global residential lighting sales by type

0%

20%

40%

60%

80%

100%

2010 2011 2012 2013 2014 2015 2016 2017

LEDs Fluorescents Incandescents & other

24 © OECD/IEA 2018

Industry CCUS pipeline is growing...

The global portfolio of large-scale CCUS projects continued to expand in 2017, with one additional industrial project linked to bioenergy coming into operation (in the U.S.)

Large-scale CO2 capture projects

11

0

5

10

15

20

25

30

35

40

1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024

MtC

O2

Large Scale CO2 capture projects

Refining

Natural gas processing

Iron and steel

Chemicals

Biofuels

Maximum projected capacity

25 © OECD/IEA 2018

…but industry and fuel transformation remains way off track….

CCUS is one of the few existing mitigation technology options for industry, but remains woefully off track to achieve the 2030 target.

Large-scale CO2 capture projects

12

0

200

400

600

800

1 000

1 200

1 400

1 600

1 800

1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040

MtC

O2

Large Scale CO2 capture projects

Refining

Natural gas processing

Iron and steel

Chemicals

Biofuels

SDS target

Maximum projected capacity