Renewables can’t cope with rising energy demand: IEA report

Jordan Smith
By Jordan Smith December 20th, 2018
For business

A report by the International Energy Agency (IEA) is warning that, despite the expanded deployment of clean energy, renewables won’t be able to fully manage growing energy demand over the coming decades. The World Energy Outlook 2018 argues that by 2040, coal and oil will still play a crucial part in our energy needs, especially in Asia.

The organization, which includes 30 member states, presented several scenarios for future developments in energy policy. Under the current policy scenario, the IEA based its projections on no changes being made to current energy policy. This would lead to a substantial increase in energy demand and carbon emissions by 2040, the World Energy Outlook noted. Even under a new policy scenario, which incorporates policies and targets already announced by governments that have yet to be implemented, energy demand will rise by more than 25 percent. The sustainable development scenario, which is based on meeting all agreed upon targets for carbon reduction, would see significant growth in the use of electricity, as well as wind and solar power. However, even under this model, coal and oil would still be used.

In a press release, the IEA argues, “Most emissions linked to energy infrastructure are already essentially locked in” until 2040. Underscoring the future challenge, IEA executive director Fatih Birol explained that the Energy Outlook reviewed all current and under-construction energy infrastructure around the globe and reached the conclusion that it accounts for 95 percent of emissions permitted under global climate targets. In other words, if future energy projects increase overall global emissions by more than 5 percent, international climate change targets will not be met.

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On a brighter note for renewable energy supporters, solar and wind power surpassed fossil fuels as the main source for generating new electricity in 2017, according to the report. The IEA expects solar power, in particular, to experience rapid growth in the coming years, surpassing wind power generation by 2025, hydro by 2030, and coal before 2040; only gas will maintain a higher percentage of energy generation.

Relying on new technologies

Due to the increase in energy and the inability of renewables to keep up, the IEA argues that we will have to rely on untested technologies to achieve internationally agreed-upon carbon reduction targets. These technologies include carbon capture, utilization and storage (CCUS), which removes carbon dioxide from the atmosphere and stores it underground. However, CCUS is yet to be implemented on a commercial scale.

Under the IEA’s sustainable development model, CCUS would have to go from capturing around 22 gigatons of carbon dioxide in 2017 to 2,300 gigatons by 2040; this equates to a more than 100-fold increase in just over two decades.

Additionally, renewable energy’s percentage of power generation would need to climb from a quarter today to two thirds by 2040 to realize the sustainable development model. In transport, renewable energy would need to rise from a 3.5 percent share of power generation to 19 percent, while in heating it would need to more than double its current share of 10 percent to 25 percent.

Another area that will require substantial growth to meet the sustainable development targets is electric vehicles, or EVs. The number of electric cars in use will need to rise from 9 million to 900 million over the next 22 years, says the IEA. Utility companies are already increasing their investments in this rapidly growing sector, with California’s major utilities pledging to invest a combined $738 million in charging infrastructure for light and heavy electric vehicles. Utilities in Maryland have also committed over $100 million to EV facilities.

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Criticism of IEA forecasts

The IEA’s predictions are far from being universally accepted. Some renewable energy organizations accuse the agency of consistently underestimating the expansion of clean energy generation, while being overly generous in their assumptions about the continued use of fossil fuels.

A CleanTechnica article in 2017 noted that the IEA’s “obsessively pessimistic forecasts” on renewable energy growth “mislead the public, mislead investors, mislead businesses, and mislead policymakers.” According to independent research cited in the article, the IEA is typically forced to correct its renewable energy growth projections upwards of 9 percent, annually.

To consider just one example of how far off past IEA World Energy Outlooks have been, the 2010 edition projected that solar energy would generate around 85 gigawatts of energy in 2017. In reality, solar power produced 402 gigawatts of global energy in 2017, meaning the IEA’s prediction eight years ago was off by more than 315 gigawatts.

Claudia Kemfert, head of the German Institute of Economic Research’s energy and environment department, believes the IEA’s underestimation of the growth of renewables reflects the interests of the fossil fuel and nuclear industries. “Probably for political and economic reasons, neither the external costs of fossil fuels nor the cost increases of nuclear energy have been factored in,” she says of IEA projections. “The fossil fuel and nuclear industries have an interest in artificially exaggerating the cost of renewables in order to influence policy in their favor.”

Jordan Smith is a freelance journalist and translator covering issues related to energy, the environment, and politics. His work has appeared on the independent news site Opposing Views, and at the Canadian Labour Institute.