The world economy needs a “more decisive break from the past” if the COP21 climate targets are to stand any chance of being hit, BP has said.
Today BP released this year’s Energy Outlook, its annual document which examines current trends in energy generation and consumption before producing a series of “what if experiments” if key assumptions and judgements occur.
But while this year’s document concluded that there have been material increases in decarbonisation efforts across the globe, more action was needed or emissions stood to actually increase in the years leading up to 2040.
BP’s Energy Outlook examines the energy transition in three key parts, namely sectors, regions and fuels. This year’s Outlook concludes that oil and other liquid fuels look set to plateau towards the end of the 2030s, all the while renewables’ share of energy consumption is forecast to reach 40%.
The oil and gas major said that renewables would play an “ever increasing role” in the world’s energy mix out to 2040.
Europe will lead the energy transition, BP said, with the continent’s carbon emissions set to fall 35% by 2040. Furthermore, carbon emissions per unit of GDP in Europe will be around half the world’s average.
And it is that statistic which looks the most damaging in BP’s outlook.
Renewables will indeed be increasingly competitive moving forward – BP has also rewritten some of its estimates from 2015, including a 150% increase in expected solar generation capacity. BP now expects solar in particular to reach grid-parity before the mid-2020s, some 10 years earlier than previously expected.
However far more deployment than that accounted for in BP’s ‘Evolving Transition’ model needs to occur. The company’s ‘Even Faster Transition’ model, which aligns with the International Energy Agency’s sustainable development scenario, requires around 11 billion tonnes of additional CO2 to be removed from the power sector by 2040.
This, BP said, would mean “significant implications” for the global energy system while simultaneously requiring a sharp increase to current carbon pricing and further renewable policies to support greater renewable deployment in development economies.
Bob Dudley, chief executive at BP, said there was “no silver bullet” to achieve the break from the past necessary.
“We need to adapt and change to play our part in achieving the transition to a low carbon energy system. This raises important challenges – but also opportunities and choices,” he said.
More to follow…