Energy Efficiency: at the center of the climate change challenge

Energy Efficiency: at the center of the climate change challenge ATEE COP 21, December 11, 2015 Philippe Benoit Head, Energy Efficiency and Environmen...
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Energy Efficiency: at the center of the climate change challenge ATEE COP 21, December 11, 2015 Philippe Benoit Head, Energy Efficiency and Environment (Climate) Division © OECD/IEA 2015

efficient

The little engine that could …

© OECD/IEA 2015

Prologue

© OECD/IEA 2015

“Getting to the top is optional.

Getting down is mandatory.”

The global challenge: Climbing down Ed the Viesturs mountain 40000 35000

Mt CO2e

30000 25000 20000 15000 10000

5000

2DS

0 1900 © OECD/IEA 2015

1925

1950

1975

2000

2025

2050 © www.nordiclandscapes.com

Our mitigation story © OECD/IEA 2015

Portfolio of actions to reduce energy sector emissions Gt CO2

60 50 40 30 20 10 0 2011

Source: ETP 2014 © OECD/IEA 2015

2020

2030

2040

2050

Portfolio of actions to reduce energy sector emissions Gt CO2

60 Nuclear 7%

50 Power generation efficiency and fuel switching 2%

40

Renewables 30%

30 End-use fuel switching 9%

20 CCS 14%

10 0 2011

Source: ETP 2014 © OECD/IEA 2015

End-use fuel and electricity efficiency 38%

2020

2030

2040

2050

Portfolio of actions to reduce energy sector emissions Gt CO2

60 50 Power generation efficiency and fuel switching 2%

40 30 20 10 0 2011

End-use fuel and electricity efficiency 38%

2020

2030

2040

2050

EE provides largest contribution to abatement at 40% Source: ETP 2014 © OECD/IEA 2015

Energy efficiency investment: bigger than you might think Investments in various fuels

400 350

USD Billion

300

250 200 150 100 50 0 Energy efficiency*

Renewable power** Fossil fired power*** Upstream oil, gas and coal****

* IEA (2014), Energy Efficiency Market Report, Paris: OECD/IEA. ** IEA (2015), Renewable Energy Market Report, Paris: OECD/IEA. *** Frankfurt School-UNEP Center (2015), Global Trends in Renewable Energy Investment, Frankfurt: Frankfurt School of Management, UNEP and Bloomberg New Energy Finance. **** IEA (2014), World Energy Investment Outlook, Paris: OECD/IEA. © OECD/IEA 2015

Big . . . but not big enough . . . Cumulative Investment in the New Policies and 450 Scenarios, 2014-2035

New Policies Scenario

26

450 Scenario

7

22

10

Fossil fuels

6

20

Power T&D

8

7

14

11

30

40

Low-carbon

50 60 Trillion dollars (2012) Energy Efficiency

Spending on energy efficiency in the 450 (2DS) scenario needs to top over $600 billion/yr

WEO 2013 Special Report © OECD/IEA 2015

Potential for energy efficiency scale-up is there … Energy efficiency potential used by sector in the WEO 2012 New Policies Scenario 100%

Unrealised energy efficiency potential

80%

Realised energy efficiency potential

60% 40% 20% Industry

Transport

Power generation

Buildings

Two-thirds of the economic potential to improve energy efficiency remains untapped in the period to 2035 © OECD/IEA 2015

Energy efficiency: the gift that keeps on giving . . . in so many ways © OECD/IEA 2015

Energy efficiency: more ‘productive’ that we give it credit for

EE keeps producing : 1999

© OECD/IEA 2015

Energy Efficiency

1999

2004

2004

2015

2015

EE’s avoided consumption in IEA topped 22 EJ (520 Mtoe) in 2014  Avoided consumption generated by energy efficiency increased by 10% in 2014 Avoided TFC in IEA countries from energy efficiency investments made since 1990

24 20

EJ

16 Avoided consumption

12 8 4 0 1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

IEA countries avoided more consumption in 2014 than the TFC of Korea and Japan combined © OECD/IEA 2015

EE is saving household, business and government consumers billions each year  IEA countries saved USD 550 billion in TFC in 2014 as a result of energy efficiency investments since 1990 Avoided expenditure in IEA countries from energy efficiency investments made since 1990

600

USD billion (2014)

500 400 300 Cumulative savings = USD 5.7 trillion

200 100

0 1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

Annual savings are greater than the EU’s fuel import bill © OECD/IEA 2015

A clean energy source: efficiency reduces emissions  Without energy efficiency investments, estimated IEA member country emissions would have been 870 Mt CO2 higher in 2014 IEA emissions from fossil fuel combustion and emissions savings from energy efficiency investments since 1990

13.5

GtCO2

13.0

Cumulative savings = 10.2 GtCO2

12.5 12.0

Emissions savings

11.5 11.0

Emissions

10.5 10.0 1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

Energy efficiency has helped to make the 2 degrees target more achievable by lowering emissions to date

© OECD/IEA 2015

The multiple benefits of EE

© OECD/IEA 2015

Dirty air prompts free public transport in Paris Public transportation in the capital will be "gratuit" from Friday morning to Sunday night, as officials battle against a spike in "dangerously" poor air quality. Velib' rental bikes and the car-sharing Autolib' scheme are also on the house.

Shifting to more efficient transport to fight air pollution March 11, 2014

© OECD/IEA 2015

Credit: Patrick Kovarik AFP

Energy Efficiency: now showing around the World

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Emissions reductions and economic growth worldwide GHG emissions reduction by measure in the Bridge Scenario, relative to the INDC Scenario, 2030 Russia European Union China

United States Middle East

India

Efficiency Inefficient coal plants Renewables Methane reductions Fossil-fuel subsidies

Latin America

Southeast Asia

Africa

Source: World Energy Outlook Special Report: Energy and Climate Change (2015).

The measures in the Bridge Scenario apply flexibly across regions, with energy efficiency & renewables as key measures worldwide © OECD/IEA 2015

Shifting geography of growth in Global Energy Demand

Over 95% of the projected growth in energy demand between now and 2035 happens outside the OECD (NPS) Source: based on World Energy Outlook 2014

© OECD/IEA 2015

Changing Geography: OECD and nonOECD action for a low-emissions future 60 Other OECD 9% 50

United States 13% European Union 7%

GtCO2

40

Other non-OECD 15% 30

Other emerging economies 14% India 13%

20

China 29%

10

0 1990

© OECD/IEA 2015

2000

2010

2020

2030

2040

2050

Changing Geography: OECD and nonOECD action for a low-emissions future 60 Other OECD 9% 50

United States 13% European Union 7%

GtCO2

40

Other non-OECD 15% 30

Other emerging economies 14% India 13%

20

China 29%

10

0 1990

2000

2010

2020

2030

2040

2050

About 70% of the decarbonization actions need to take place in non-OECD countries © OECD/IEA 2015

EE: Decoupling GDP from Energy 20 000

160 000 140 000

18 000

120 000

Mtoe

100 000 14 000

80 000

60 000 12 000 40 000 10 000 20 000 8 000

0 2001

© OECD/IEA 2015

2006

2011

2016

2021

2026

USD Billions 2005 PPP

16 000 TPES 6DS GDP (right axis)

EE: Decoupling GDP from Energy 20 000

160 000 140 000

18 000

120 000

Mtoe

100 000 14 000

80 000

60 000 12 000 40 000 10 000 20 000 8 000

0 2001

© OECD/IEA 2015

2006

2011

2016

2021

2026

USD Billions 2005 PPP

16 000 TPES BAU-Low EE 6DS

GDP (right axis)

EE: Decoupling GDP from Energy 20 000

160 000 140 000

18 000

120 000

Mtoe

100 000 14 000

80 000

60 000 12 000 40 000 10 000 20 000 8 000

0 2001

© OECD/IEA 2015

2006

2011

2016

2021

2026

USD Billions 2005 PPP

16 000 TPES 6DS BAU-Low EE 4DS 2DS High Productivity GDP (right axis)

Energy efficiency for many emerging economies: from “doing more with less” to to ”doing even more with more” © OECD/IEA 2015

Energy efficiency for many emerging economies: from “doing more with less” to ”doing even more with more”

raising standards of living and promoting prosperity © OECD/IEA 2015

IEA messages to COP21 To shift the energy sector onto a low-carbon path that supports economic growth & energy access: 1.

Take 5 key actions, led by energy efficiency & renewables, to peak then reduce global energy emissions

2.

Use the Paris Agreement to drive short-term actions consistent with long-term emission goals

3.

Accelerate energy technology innovation to make decarbonisation easier and even more affordable

4.

Enhance energy security by making the energy sector more resilient to climate change impacts

© OECD/IEA 2015

‘Et après Paris?’

© OECD/IEA 2015

Gt

Beyond INDCs: the need for more 36 INDC Scenario 33

30

27 450 Scenario 24

2015

2020

2025

2030

“Room” for further policies promoting energy efficiency WEO 2015 CC Special Report © OECD/IEA 2015

Epilogue

© OECD/IEA 2015

2O C vs

4/6OC?

Below 2OC

vs

4OC

Thank you

the little engine that can … beat climate change © OECD/IEA 2015

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