Energy and Climate: Three Sobering Observations
September 2nd, 2010 by Bram Buijs, Clingendael International Energy ProgrammeThree interrelated developments in the world’s energy system and energy-related emissions should be recognized as critical signals regarding international action on climate change: (1) coal has been the fastest growing fossil fuel for the past 7 years; (2) the carbon intensity of the world’s total primary energy supply has been increasing in the past decade; (3) previous emissions reduction efforts have fallen short and emissions have been (and still are) rising in almost all countries in the world.
Observation 1: Coal has been the fasting growing fossil fuel for the past 7 years.
According to the BP Statistical Review of World Energy 2009, global coal consumption increased by 3.1% in 2008, compared to an overall primary energy consumption growth of 1.4%. Although this was the slowest growth rate of coal demand in the past few years, it still made coal the fastest growing primary energy source (in comparison to oil, gas and hydropower) for the sixth consecutive year leading up to 2009. Even in 2009, when global primary energy consumption decreased by 1.1% due to the impact of the financial and economic crisis, coal demand remained resilient: while demand for oil and gas dropped by 1.7% and 2.1% respectively, coal demand stayed flat due to strong growth in the Asian Pacific region.
Global coal production grew from 4.6 billion tonnes to 6.9 billion tonnes in the decade from 1999 to 2009. In many regions new production techniques such as mountaintop removal and open pit mining have made a dramatic increase in production levels possible at lower costs. China has been the main driver of global demand: Chinese coal demand more than doubled in the period from 1999 to 2009 and accounted for 74 percent of the growth in global coal consumption over the same period. It is currently the largest producer (producing more than twice as much as the United States, which ranks second) and the largest consumer of coal, accounting for just over 45% of global production and demand. With per capita primary energy consumption in China standing at one-third of OECD levels, the potential for increasing consumption levels is enormous. The IEA projects that global coal consumption will increase by more than 50% by 2030 and that 97% of all global growth in coal consumption between now and 2030 will come from Asia, with the largest shares going to China (65%) and India (20%).
The main demand for coal lies in electricity and heat generation. The share of coal used for these purposes compared to other fuels increased from 36% to 41% in between 1992 and 2007 globally and even more significantly (from 43% to 53%) for non-Annex-I countries to the Kyoto Protocol. China, India and the United States all rely heavily on coal-fired power generation, with the share of coal in total generated electricity standing at 81%, 68% and 49% respectively.
Worldwide proven reserves are still enormous, enough for another 119 more years at current rates of consumption (compared to 46 and 63 years for oil and gas, respectively). This entails only proven reserves, which might be significantly enlarged. According to current estimates, China and India hold the third and fifth largest proven reserves of coal in the world.
Observation 2: The carbon intensity of the world’s energy supply is increasing.
This observation may seem rather counterintuitive, given the major attention to climate change and low-carbon energy sources and their rapid growth. However, going directly against this low-carbon objective is the trend that the carbon intensity of our energy supply is actually increasing (see Figure 1). Naturally, this is directly related to the first observation that coal is the fastest growing fossil fuel.
Due to its high carbon content, coal emits about twice as much carbon dioxide as natural gas when combusted. Hence, although coal provides only a quarter of the world’s total primary energy supply (TPES), it accounts for 42% of CO2 emissions_a share that is expected to steadily increase. Renewable energy sources—in particular the ‘new’ non-hydro renewable energy sources such as wind and solar—have very high growth rates, especially when considering their increasing share in newly installed capacity in power generation. However, their base is very small, and consequently their share in total generated electricity is increasing much more slowly. Moreover, electricity consumption is only part of the world’s total energy use. Particularly for the purposes of heating and transport, fossil fuels still dominate the energy supply. As a consequence, the share of non-hydro modern renewable energy technologies (including wind, solar, geothermal, tide and wave energy) are projected to increase their share of total energy use only to slightly more than 2% in 2030—up from less than 1% today.
The growth of coal is complemented by a slow reduction of the share of hydropower—currently by far the most significant renewable energy source—because in many countries the technical potential for hydropower has already been largely utilized (e.g. in the United States, Europe and Japan; China will face this problem as well in one or two decades). Nuclear power has historically played an important role in decreasing the carbon intensity of the global energy supply, yet its share in the global fuel mix is also declining. Especially in Europe a whole generation of nuclear power plants will need to be decommissioned sooner or later: in the absence of a ‘nuclear renaissance’, the share of nuclear power is projected to drop significantly. The growth of nuclear power outside the US and Europe does not compensate sufficiently to reverse this decline, even though especially China is implementing a ambitious nuclear programme, with about one-third of all nuclear plants under construction located in China.
Observation 3: Current efforts to curb greenhouse gas emissions are still falling short.
Up until the financial and economic crisis, global emissions of greenhouse gases had been accelerating, and they are expected to pick up the pace again soon. Total emissions of anthropogenic greenhouse gases increased from 24 billion tonnes of CO2-equivalent (CO2e) in 1970 to 33 billion tonnes in 1990 and 41 billion in 2005, with an average annual growth rate of about 1.2% over this quarter-century. Yet growth rates have been going up, with an increase of 3% in the five-year period between 1990 and 1995, 6% between 1995 and 2000 and 15% over the period 2000-2005.
Annual growth rates from industrialized countries slowed between 1970 and 2005, while their emissions increased from 16 billion to 19 billion tonnes during the same period. However, emissions from developing countries almost tripled from 7 billion tonnes in 1970 to circa 21 billion in 2005. Carbon dioxide emissions (predominantly energy-related) grew by 18% over the period 2000-2005, even faster than most other greenhouse gases.
The financial and economic crisis caused global energy consumption to drop significantly for the first time since 1980, and energy-related carbon dioxide emissions showed a decline of 1.1% in 2009 compared to the previous year. This temporary reprieve has the unintended effect of helping some countries to meet their Kyoto Protocol commitments, yet the expectations are that despite the inclusion of ‘green’ and ‘low carbon’ investments in economic recovery packages around the world, the outlook for further growth of emissions has not fundamentally changed.
Under the Kyoto Protocol, the industrialized Annex-I countries (including the United States) committed to a joint 5.2% reduction target for 2010 compared to 1990 levels. Currently aggregate Annex-I emissions reductions stand at 3.9% when excluding emissions/removals from land use, land-use change and forestry (LULUCF). However, this can be attributed largely to the economic collapse of the Economies In Transition (EIT), among them Russia and Eastern European countries, whose emissions decreased by 37% compared to 1990 levels. In contrast, overall emissions from non-EIT Annex-I parties increased by 11.2% (Figure 2). Figure 2 illustrates that emissions from the EIT countries are slowly growing again: e.g. Russian emissions in 2007 showed an 8% increase compared to 2000 levels.
Figure 3 gives an overview of the greenhouse gas emissions over the period 1990-2007 of the major Annex-I parties. This includes the United States, which signed but did not ratify the Kyoto Protocol and was originally assigned a reduction target of -7% for the first commitment period (2008-2012). Instead, emissions from the United States rose by 16.8% compared to 1990 levels. Yet also for Australia, Canada and Japan—Annex-I countries that all ratified the Kyoto Protocol—emissions have all increased and meeting the Kyoto target is practically out of reach.
The European Union is the only non-EIT Annex-I party to the Kyoto Protocol that is roughly on track to meet its emissions reduction target of -8% compared to 1990 levels. Current emissions from the EU-15 countries that originally signed the Kyoto Protocol now stand at -4.3% compared to 1990 levels, while emissions of the EU-27 member states stand at -9.3%. Again, the economic situation of the new (EU-12) member states contributed to this decrease.
The broad trends outlined above show that over the past decade the world has been moving towards a more coal-based energy system, with huge potential consequences for emissions and climate change. Moreover, up to now, the impact resulting from policy on climate change has been rather limited. The lack of progress in Copenhagen and the bleak prospects of an effective deal emerging from it in the short term give little reason for optimism on achieving any shift in this trend.
If the carbon content of the global energy supply is any measure to go by, the world is still heading in the wrong direction.
Bram Buijs, researcher at the Clingendael International Energy Programme (CIEP) based in The Hague, the Netherlands.
P.S. This post is derived from a recent paper available here
September 2nd, 2010 at 7:42 pm
‘Nuclear power has historically played an important role in decreasing the carbon intensity of the global energy supply, yet its share in the global fuel mix is also declining. Especially in Europe a whole generation of nuclear power plants will need to be decommissioned sooner or later: in the absence of a ‘nuclear renaissance’, the share of nuclear power is projected to drop significantly. The growth of nuclear power outside the US and Europe does not compensate sufficiently to reverse this decline, even though especially China is implementing a ambitious nuclear programme, with about one-third of all nuclear plants under construction located in China.’
Nuclear is the obvious answer. Hopefully the world will soon follow China.
September 3rd, 2010 at 10:55 am
This paints a sobering global story where coal indeed is a main culprit. But I’d be more cautious about pivoting to Europe in the same line of argument, however, since it is wind energy that has been installed at a pace greater than any fossil fuel or nuclear in the past few years and is only second to gas over the past decade. The period following the point of analysis here, through 2007, has seen big declines, due largely to the economic downturn but also corresponding to a period in which greater climate policy efforts are kicking in – the test will be as we pull out of recession and separate those two strands. In any case, only Canada says it won’t meet its Kyoto targets. Remember that it was the Umbrella countries who negotiated the CDM and Europe the bubble – and so, no matter their domestic emissions countries will meet their obligations, whether or not the means by which they’ve done so is a good thing – that’s another thing to solve.