Although time is running out, the world could still hold global warming to well below two degrees Celsius and avoid the worst impacts of climate change, according to BloombergNEF’s New Energy Outlook 2024.
The new report indicates the speed with which clean technologies and decarbonization of the power sector are scaled up is crucial.
The study published today by research provider BloombergNEF, presents two updated climate scenarios, the Net Zero Scenario (NZS) and a base case Economic Transition Scenario (ETS).
These are designed to inform public policymaking, country climate ambition and low-carbon transition strategies of corporations and financial institutions.
The report’s NZS, which is consistent with a 67% chance of holding global warming to 1.75 degrees Celsius, sees demand for oil, gas and coal reach an immediate peak and fall into a steep decline starting from the year 2025.
The power, transport, industry and buildings sectors transition at different speeds based on the technologies available for them to decarbonise, but all see emissions start to fall immediately.
These short-term changes only come to pass thanks to a rapid scale-up of clean energy technologies, in particular a tripling of global renewable-energy capacity by 2030, rapid uptake of electric vehicles leading to a full global phase-out of combustion engine vehicle sales by 2034, and a major scale-up of carbon capture technology, alongside energy storage and nuclear power, before 2030.
David Hostert, head of economics and modeling at BNEF and the lead author of the report, said: “The path to staying well below two degrees is narrowing.
“In the 18 months since we last updated our global scenarios, the energy transition has certainly accelerated – but not nearly enough.
“This report should serve as a wake-up call: we need a rapid decline in emissions starting from now – not in five years’ time – if net zero by mid-century is to remain a possibility.”
Cleaning up the power sector accounts for almost half of emissions avoided between today and 2050, compared with a no-transition scenario where there is no further action on decarbonization, the report found.
The New Energy Outlook also details a base case ETS, in which clean-energy technologies are only deployed where they are economically cost-competitive or adopted by consumer choice, with no further policy support for clean technologies.
The affordability of renewable energy, especially solar and wind, means that they grow rapidly in this scenario, to 51% of global power generation by 2030, and 70% by 2050.
The global power system is transformed and becomes much more flexible in order to accommodate high penetrations of wind and solar.
Lead energy systems modeller at BNEF Ian Berryman said: “Our hourly modelling shows that power systems can accommodate very high penetrations of wind and solar without incurring higher costs.
“With the aid of smart electric vehicle charging, battery storage and flexible generators, the most affordable power system of the future will be one based on a foundation of inexpensive renewables.”