Released November 01, 2024 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Later this month, the annual United Nations Climate Change Conference will take place at Baku, Azerbaijan. This year's event, known as the Conference of the Parties that signed the U.N. Framework Convention on Climate Change, or COP29, will confront an inconvenient truth: Carbon dioxide (CO2) emissions from less-wealthy nations (the Global South) continue to grow much faster than CO2 emissions are being reduced by the world's wealthiest nations (the Global North).
That's because countries in the Global South, including China, India and Indonesia, have plentiful supplies of coal, and they are using it to electrify their economy and propel their industrialization. That point has been made in several reports from the International Energy Agency (IEA) (Paris, France).
COP29 is scheduled to have several sessions on financing decarbonization efforts in Global South countries. At an earlier COP, in 2009, Global North countries and financial institutions committed to providing $100 billion per year in funding to support those decarbonization measures. The pledged sums never materialized: Only $61 billion in total has been collected since that pledge was made in 2009. Over the years, observers say the need is even greater than what was agreed to back in 2009.
"We are now in a world where almost every energy story is essentially a China story," commented IEA Executive Director Fatih Birol in the agency's "World Energy Outlook 2024," released October 16 as part of an effort to frame the issues at COP29.
In Birol's telling, the China story has positive and negative dimensions: On the positive side, that country is aggressively deploying renewable electric generation and electric vehicles (EVs) while expanding clean technology manufacturing. But the negative side includes continued aggressive expansion of fossil-fueled generation and the financing of such generation to other nations in the Global South.
"World Energy Outlook 2024," nearly 400 pages in length, uses the same three scenarios the IEA developed and has used in other reports to discuss decarbonization efforts:
Click on the image at right to see a graphic of CO2 emissions from the power sector as projected under three scenarios through 2050.
The IEA report notes that China and other EDME nations are building renewables while they also are burning coal, oil and natural gas to generate electricity. But the population growth in those countries is so high that in many cases the incremental demand for electricity is met by burning fossil fuels, which releases CO2 into the atmosphere.
For example, in China, electricity generated from renewables more than tripled from 2010 to 2023. Over that same time, electricity generated from coal rose about 80% on a much larger installed base. Similarly, in India, electricity generated from coal more than doubled while renewables rose 150% over the 2010-2023 period. In Southeast Asia, the use of coal to generate electricity more than doubled over that same period while electricity produced by renewables more than tripled.
Worldwide energy sector investments reached about $2.9 trillion in 2023 and are likely to exceed $3 trillion for the first time in 2024, the report said. It added that about two-thirds of that spend will go to clean energy technologies and infrastructure investments while fossil projects garner one-third.
"Global investment in clean energy has increased by 60% since 2015," the IEA report said, "driven not only by emissions reduction goals, but also by robust underlying economics, considerations of energy security during a period of extreme volatility in fossil fuel prices and competition among leading economies for positions in the new clean energy economy that will be an important source of growth and employment in the coming years."
But much of that clean energy spending has taken place in China and advanced economies, the report noted: "Recent increases in clean energy investment come mostly from advanced economies and China, making up 85% of the total, while other emerging market and developing economies, home to two-thirds of the global population, account for just 15%."
Clean energy spending will have to ramp up and be redirected to Global South countries if the world wants to avoid the worst ravages of global warming.
While advanced economies and China will have to roughly double their clean energy spending by 2035 in the APS and NZE cases, other developing economies are looking at boosting 2023 spending by 650% by 2035 to achieve emissions reductions consistent with the IEA's APS and NZE cases.
"The surge in clean energy spending that is required in both the APS and NZE scenario can appear daunting for emerging market and developing economies," the IEA report said. "But many examples (in the report) show that a clear vision for energy transitions, supported by sound policies, regulations and private sector engagement, can drive growth in both the quantity and quality of clean energy investments."
Today, "World Energy Outlook 2024" estimated that about 700 million people around the world lack electricity and another 2 billion lack access to clean cooking equipment. This latter group cooks its food using wood and animal dung. Bringing universal electric service to those 700 million people will take an investment of about $45 billion per year through 2030. An additional $10 billion per year to 2030 will be required to install clean-cooking equipment, mainly propane stoves.
The report said "public and concessional finance has a crucial role to improve affordability and reduce perceived risks for private investors through programs and initiatives such as the World Bank and African Development Bank." Concessional finance is an umbrella term covering funding that is provided at a lower-than-market rate and on more favorable terms than what is available from commercial financial institutions.
So, no, Uncle Sam is not expected to foot the entire bill for electrifying the Global South or to install clean cooking equipment. Some of that bill, but not all of it. Multilateral institutions must also play a role as providers of seed capital, the report said. Once developing and emerging markets have evolved to the point where private financial institutions feel adequate risk protections are in place, they are expected to participate.
Combatting global warming necessarily yokes together the fates of the Global North and Global South. Left unmitigated, rising CO2 emissions from Global South nations are predicted to drive up global concentrations of CO2 in the atmosphere, propelling the average global temperature upward.
Scientists agree that an average long-term temperature gain exceeding 1.5 degrees Celsius over pre-industrial times would lead to a bleak future characterized by rising sea levels that threaten to inundate coastal communities; more frequent and intense extreme weather events like heatwaves, droughts, floods and storms; disruptions to ecosystems and biodiversity loss; food insecurity due to changing agricultural conditions; increased spread of diseases; and mass migration due to climate displacement. All of these things would harm human health, particularly for vulnerable populations like the elderly and children.
The report suggests that recent extreme weather events in the U.S., such as hurricanes Beryl in Texas, Helene in the southeast and Milton in Florida, could be only a partial snapshot of the future unless global warming is slowed and reversed.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
That's because countries in the Global South, including China, India and Indonesia, have plentiful supplies of coal, and they are using it to electrify their economy and propel their industrialization. That point has been made in several reports from the International Energy Agency (IEA) (Paris, France).
COP29 is scheduled to have several sessions on financing decarbonization efforts in Global South countries. At an earlier COP, in 2009, Global North countries and financial institutions committed to providing $100 billion per year in funding to support those decarbonization measures. The pledged sums never materialized: Only $61 billion in total has been collected since that pledge was made in 2009. Over the years, observers say the need is even greater than what was agreed to back in 2009.
"We are now in a world where almost every energy story is essentially a China story," commented IEA Executive Director Fatih Birol in the agency's "World Energy Outlook 2024," released October 16 as part of an effort to frame the issues at COP29.
In Birol's telling, the China story has positive and negative dimensions: On the positive side, that country is aggressively deploying renewable electric generation and electric vehicles (EVs) while expanding clean technology manufacturing. But the negative side includes continued aggressive expansion of fossil-fueled generation and the financing of such generation to other nations in the Global South.
"World Energy Outlook 2024," nearly 400 pages in length, uses the same three scenarios the IEA developed and has used in other reports to discuss decarbonization efforts:
- Stated Policies Scenario (STEPS) is effectively the continuation of current actions, or business as usual
- Announced Pledges Scenario (APS) shows what would happen if all national energy and climate targets made by governments, including net-zero goals, were met in full and on time, and
- Net-Zero Emissions by 2050 Scenario (NZE) maps out "an increasingly narrow path" to reach net-zero emissions by mid-century in a way that limits the long-term average temperature gain to 1.5 degrees Celsius over preindustrial times.
The IEA report notes that China and other EDME nations are building renewables while they also are burning coal, oil and natural gas to generate electricity. But the population growth in those countries is so high that in many cases the incremental demand for electricity is met by burning fossil fuels, which releases CO2 into the atmosphere.
For example, in China, electricity generated from renewables more than tripled from 2010 to 2023. Over that same time, electricity generated from coal rose about 80% on a much larger installed base. Similarly, in India, electricity generated from coal more than doubled while renewables rose 150% over the 2010-2023 period. In Southeast Asia, the use of coal to generate electricity more than doubled over that same period while electricity produced by renewables more than tripled.
Worldwide energy sector investments reached about $2.9 trillion in 2023 and are likely to exceed $3 trillion for the first time in 2024, the report said. It added that about two-thirds of that spend will go to clean energy technologies and infrastructure investments while fossil projects garner one-third.
"Global investment in clean energy has increased by 60% since 2015," the IEA report said, "driven not only by emissions reduction goals, but also by robust underlying economics, considerations of energy security during a period of extreme volatility in fossil fuel prices and competition among leading economies for positions in the new clean energy economy that will be an important source of growth and employment in the coming years."
But much of that clean energy spending has taken place in China and advanced economies, the report noted: "Recent increases in clean energy investment come mostly from advanced economies and China, making up 85% of the total, while other emerging market and developing economies, home to two-thirds of the global population, account for just 15%."
Clean energy spending will have to ramp up and be redirected to Global South countries if the world wants to avoid the worst ravages of global warming.
While advanced economies and China will have to roughly double their clean energy spending by 2035 in the APS and NZE cases, other developing economies are looking at boosting 2023 spending by 650% by 2035 to achieve emissions reductions consistent with the IEA's APS and NZE cases.
"The surge in clean energy spending that is required in both the APS and NZE scenario can appear daunting for emerging market and developing economies," the IEA report said. "But many examples (in the report) show that a clear vision for energy transitions, supported by sound policies, regulations and private sector engagement, can drive growth in both the quantity and quality of clean energy investments."
Today, "World Energy Outlook 2024" estimated that about 700 million people around the world lack electricity and another 2 billion lack access to clean cooking equipment. This latter group cooks its food using wood and animal dung. Bringing universal electric service to those 700 million people will take an investment of about $45 billion per year through 2030. An additional $10 billion per year to 2030 will be required to install clean-cooking equipment, mainly propane stoves.
The report said "public and concessional finance has a crucial role to improve affordability and reduce perceived risks for private investors through programs and initiatives such as the World Bank and African Development Bank." Concessional finance is an umbrella term covering funding that is provided at a lower-than-market rate and on more favorable terms than what is available from commercial financial institutions.
So, no, Uncle Sam is not expected to foot the entire bill for electrifying the Global South or to install clean cooking equipment. Some of that bill, but not all of it. Multilateral institutions must also play a role as providers of seed capital, the report said. Once developing and emerging markets have evolved to the point where private financial institutions feel adequate risk protections are in place, they are expected to participate.
Combatting global warming necessarily yokes together the fates of the Global North and Global South. Left unmitigated, rising CO2 emissions from Global South nations are predicted to drive up global concentrations of CO2 in the atmosphere, propelling the average global temperature upward.
Scientists agree that an average long-term temperature gain exceeding 1.5 degrees Celsius over pre-industrial times would lead to a bleak future characterized by rising sea levels that threaten to inundate coastal communities; more frequent and intense extreme weather events like heatwaves, droughts, floods and storms; disruptions to ecosystems and biodiversity loss; food insecurity due to changing agricultural conditions; increased spread of diseases; and mass migration due to climate displacement. All of these things would harm human health, particularly for vulnerable populations like the elderly and children.
The report suggests that recent extreme weather events in the U.S., such as hurricanes Beryl in Texas, Helene in the southeast and Milton in Florida, could be only a partial snapshot of the future unless global warming is slowed and reversed.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
