Electricity likely to play a key role in future energy systems, says IEA

The International Energy Agency, an autonomous organisation which works to ensure reliable, affordable and clean energy for its 28 member countries including Canada and the USA, has published a report Energy Technology Perspectives 2014 which seeks to chart a course by which policy and technology together become driving forces – rather than reactionary tools – in transforming the energy sector over the next 40 years. According to the report electricity is likely to be an increasingly important vector in energy systems of the future. The report looks at more than 500 technology options, exploring pathways to a sustainable energy future in which policy support and technology choices are driven by economics, energy security and environmental factors. Interestingly the low carbon option confirms that global population and economic growth can be decoupled from energy demand, even for oil. Among the findings:

  • Solar, hydropower and onshore wind are presently forging ahead, while development is mixed for other clean energy supply.
  • Emerging economies have stepped up their ambitions and become leaders in deploying low-carbon energy technologies.
  • Continued increase in coal use counteracts emissions reduction from recent progress in the deployment of renewables, underlining the need to improve coal plant efficiency and scale up carbon capture and storage.
  • Fossil fuel use decreases by 2050 in the 2DS (the low carbon scenario), but its share of primary energy supply remains above 40%, reflecting its particularly important role for use in industry, transport and electricity generation.
  • Energy efficiency makes the largest contribution to global emissions reduction in the 2DS, but needs to be combined with other technologies to meet long term targets.
  • Globally, growth in electricity demand is outpacing all other final energy carriers; this creates potential for radically transforming both energy supply and end use.
  • The transition to electrification is not neutral: in fact, decarbonisation requires a massive reversal of recent trends that have shown continued reliance on unabated fossil fuels for generation.
  • Impressive deployment of renewable technologies is beginning to shape a substantially different future in supply.
  • Over the medium term, the 2DS sees strong interplay between variable renewables and the flexibility of natural gas to supply both base-load and balancing generation.
  • Natural gas should be seen only as a bridge to cleaner energy technologies unless CCS is deployed.
  • Decarbonising the electricity sector can deliver the spillover effect of reducing emissions from end-use sectors, without needing further end-use investments.
  • Increased electrification of buildings through the deployment of heat pumps as part of a comprehensive approach to improving buildings energy efficiency can significantly displace natural gas demand.
  • Electrification of transport, together with improved fuel economy, fuel switching and new vehicle technologies, substantially reduces transport sector oil use in the 2DS without considerably increasing overall electricity demand.
  • The USD 44 trillion (real 2012 USD) additional investment needed to decarbonise the energy system in line with the 2DS by 2050 is more than offset by over USD 115 trillion in fuel savings – resulting in net savings of USD 71 trillion.
  • Regulation and market transformation can help or hinder the potential of individual technologies, including their competitiveness.
  • Without the stimulus of carbon pricing, alternative policy instruments will be necessary to trigger low-carbon investment in competitive markets.

The full 382 page report (PDF €120), a free 10 page Executive Summary and other associated documents are available at http://www.iea.org/newsroomandevents/pressreleases/2014/may/name,51005,en.html 

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