© OECD/IEA 2018

Where do we want to go?

EU Talanoa Conference, 13 June 2018, Brussels

IEA

Dave Turk, Acting Director, Sustainability, Technology and Outlooks

© OECD/IEA 2018

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

© OECD/IEA 2018

-40

-20

0

20

40

60

2010 2020 2040 2060 2080 2100

Gt CO2

Sustainable

Development

Scenario

Scenarios projecting a

1.7-1.8°C rise in 2100

Sustainable Development Scenario vs. other long-term decarbonisation scenarios

Sustainable Development Scenario is at more ambitious end of 1.7 °C to 1.8 °C scenarios

3

© OECD/IEA 2018

SDS – unabated fossil fuels make way for low-carbon energy

In the Sustainable Development Scenario, fossil fuels step back substantially

as low-carbon energy takes centre stage

4

Coal Oil Gas

Power

Industry

Transport

Other

-2 056

Mtce

-15

mb/d

-276

bcm

Demand decline in the SDS from NPS, 2030

1 000

2 000

3 000

4 000

5 000

2000 2010 2020 2030

Mto

e

NPS SDS

Coal

Oil

Gas

Fossil-fuel demand

© OECD/IEA 2018

Energy storage

Smart grids

Demand response

Digitalization

Hydrogen

Renewable heat

Energy Integration

Tracking Clean Energy Progress 2018

5

Power

Renewable power

Solar PV

Onshore wind

Offshore wind

Hydropower

Bioenergy

Geothermal

Concentrating solar

power

Ocean

Nuclear power

Natural gas-fired power

Coal-fired power

CCS in power

Industry

Cement

Chemicals

Steel

Aluminum

Pulp and paper

CCS in industry

Transport

Electric vehicles

International shipping

Fuel economy

Trucks

Transport biofuels

Aviation

Rail

Buildings

Building

codes

Heating

Cooling

Lighting

Appliances &

equipment

Data centres

and networks

© OECD/IEA 2018

Overall renewables growth is not fully on track

Renewables saw highest rate of generation growth among all energy sources in 2017,

but deployment must further speed up to meet 2030 targets

0

2000

4000

6000

8000

10000

12000

14000

16000

Renewables generation by technology

Ocean

Geothermal

CSP

Offshore wind

Bioenergy

Hydropower

Onshore wind

Solar PV

6

TWh

© OECD/IEA 2018

Solar PV is the only renewable technology on track

Solar PV has shown record growth in 2017; it is well on track to meet its SDS target

0

10

20

30

40

50

60

China UnitedStates

India Brazil Japan EU

Solar PV deployment

2015

2016

2017

Net

cap

acit

y ad

dit

ion

s, G

W

7

0

500

1 000

1 500

2 000

2 500

3 000

2000 2005 2010 2015 2020 2025 2030

TW

h

Solar PV generation

© OECD/IEA 2018

Onshore wind and hydro need more improvement

0

5

10

15

20

25

30

35

40

China UnitedStates

India Brazil Japan EU

Onshore wind deployment

Net

cap

acit

y ad

dit

ion

s (G

W)

Onshore wind capacity additions declined by 10% in 2017, marking the second year of decline;

hydropower additions have also decreased for the fourth consecutive year

0

5

10

15

20

25

30

China UnitedStates

India Brazil Japan EU

Hydropower deployment

2015

2016

2017

Net

cap

acit

y ad

dit

ion

s (G

W)

8

© OECD/IEA 2018

LED sales on track to reach 80% of total by 2030

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

Shares of global residential lighting sales by type

0%

20%

40%

60%

80%

100%

2010 2011 2012 2013 2014 2015 2016 2017 2025 2030

LEDs Linear fluorescents Compact fluorescents Halogens Incandescants

9

© 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

millio

ns

Others

United States

Europe

China

Global electric car stock

0

100

200

300

400

500

600

700

800

900

1000

2013 2014 2015 2016 2017 2030 2040

Ele

ctri

c ca

r st

ock

(m

illio

ns)

SDS Target

Others

United States

Europe

China

10

© 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

© 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

© OECD/IEA 2018

Clean energy R&D investment is finally on the rise…

Investment in clean energy R&D rose in 2017, but more is needed;

Mission Innovation is having an impact

0

5

10

15

20

25

2012 2013 2014 2015 2016 2017E

North America Europe Asia and Oceania Rest of World

Total public spending on clean energy technology RD&D (in billion USD)

13

© OECD/IEA 2018

www.iea.org IEA

© OECD/IEA 2018

IEA Engagement in Talanoa Dialogue

1. Timely data, rigorous analysis and real-world solutions

2. Written submission; 2nd submission for October 2018 deadline

3. Participated in Talanoa Dialogue discussions at May session in Bonn and happy

to join other dialogues / events as well

2

© OECD/IEA 2018

Key messages

• IEA supports the Talanoa Dialogue through its data, analysis, and real world solutions.

• The Sustainable Development Scenario (SDS) defines a future energy vision that integrates climate change, energy access and air quality goals.

• In the SDS, energy efficiency and renewable deployment drive the vast majority of emissions reductions; fossil fuels step back as low carbon energy takes center-stage.

• Tracking Clean Energy Progress examines “where we are” compared to “where we want to go”, while providing guidance on “how we get there.”

• As countries develop their NDCs, short-term actions need to be guided by, and consistent with, longer-term goals of “where we want to go.”

11

© 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