Peak in energy emissions seen as too slow for net-zero goal, report says

OSLO – Global energy-related emissions should peak next year – marking a key point for the renewables transition – but the shift will be too slow to meet 2050 net-zero targets, Norwegian risk management company DNV said.

In the five years to 2022,

renewables met just over half of new energy demand,

with fossil-fuel usage still growing in absolute terms, it said in a report. Limiting global warming to 1.5 deg C looks less likely than ever, it added.

“Globally, the energy transition has not started, meaning that we are still adding more fossil fuels to the energy mix,” DNV chief executive officer Remi Eriksen said in an interview. “Record emissions from fossil energy are on course to move even higher next year.”

Russia’s invasion of Ukraine and knock-on supply disruptions raised fossil-fuel prices and prompted more investment in new oil and gas projects. That drew greater attention to energy security, prompting governments to focus on locally sourced supply, DNV said. And while there has been a strong green push in Europe and North America, coal-fired generation is seen rising in nations like India.

The fallout of the war in Ukraine has also undermined natural gas’ role as a bridging fuel, Mr Eriksen said. Gas supplies that once flowed to Asia are now being diverted to Europe, meaning countries such as China, Pakistan and Indonesia are also burning more coal.

Still, the energy transition is expected to take hold in the coming years, according to DNV.

Energy-related emissions by the end of the decade are forecast to be down 4 per cent from now, and 46 per cent lower by 2050, the report showed. By then, fossil fuels will account for 48 per cent of energy generation, compared with 80 per cent today.

“The oil and gas industry is going into unknown territory of declining demand,” said Mr Sverre Alvik, director of DNV’s energy transition outlook. “It’s a totally new risk picture for the sector.” BLOOMBERG