Chikafumi Hodo, Reuters 6 Jun 08;
TOKYO (Reuters) - World governments must quickly start a $45 trillion "energy technology revolution" that could drive up the cost of producing carbon ten-fold, or risk emissions surging by 2050, the West's energy watchdog warned on Friday.
The world would need to build dozens of nuclear power plants a year and bury carbon emitted from dozens more gas and coal plants, plus cutting the carbon intensity of cars, trucks, buses and planes eightfold, to halve emissions by mid-century, the International Energy Agency said in a new report.
Without taking action on government policy, emissions would surge by 130 percent and oil demand would rise by 70 percent by 2050, the IEA said, far beyond the level that many experts believe the world is capable of sustainably producing.
The report, commissioned by the Group of Eight three years ago, lays down the gauntlet for G8 leaders gathering in northern Japan next month, where Tokyo is expected to urge them to agree on a target of chopping greenhouse gases in half by 2050.
"There should be no doubt -- meeting the target of a 50 percent cut in emissions represents a formidable target. We would require immediate policy action and technological transition on an unprecedented scale," Nobuo Tanaka, Executive Director of the IEA, said in a statement.
"It will essentially require a new global energy revolution which would completely transform the way we produce and use energy... We need to act now."
The IEA said halving emissions by 2050 would require "all options up to a cost of $200 per ton of CO2" -- and in the worst case $500 a ton -- giving a rare long-term forecast that suggests a sharp rise from the 27 euro ($42) a ton price for carbon emissions rights trading in Europe.
"You would have to see one of the biggest rises in a commodity price in history to get $500 a ton," said Tom Luckock, a lawyer with international law firm Norton Rose.
Scientists say that the world must brake and reverse annual increases in greenhouse gas emissions to avoid catastrophic climate change including rising seas and more extreme weather.
But governments are at odds over how to split the costs of funding cleaner energy technology, particularly in the developing world. The IEA said the $45 trillion is equal to 1.1 percent of average annual global gross domestic product over the period.
"Carbon emissions must be cut. Costs of about 1 percent of GDP are not outrageous, so this target is realistic," said Go Hibino, a senior manager at Mizuho Information & Research Institute.
About 190 nations are racing to craft a framework by the end of 2009 to succeed the Kyoto Protocol, which binds 37 advanced nations to cut emissions by an average of 5 percent below 1990 levels by 2008-12.
OIL DEMAND CURBS
The report, which comes just ahead of a G8 energy ministers meeting this weekend in Japan, highlighted the security benefits of cracking down on carbon.
"Oil demand by 2050 would be 27 percent below the level of 2005. Yet massive investments in remaining reserves will be needed to make up for the shortfall as low-reserve provinces are exhausted," Tanaka said.
A massive research and development effort will be needed in the next 15 years costing about $10 billion to $100 billion per year to develop technology to cut CO2 emissions, the IEA said in the Energy Technology Perspectives report.
It said the power sector would need to be "decarbonized" by installing CO2 capture and storage (CCS) at 35 coal- and 20 gas-fired power plants a year from 2010 to 2050 at a cost of $1.5 billion each. The sector would also need to build 32 new nuclear plants and install 17,500 wind turbines a year.
Germany's RWE Supply and Trading said on Wednesday that CCS, often regarded as commercially impossible, could be viable with carbon prices of less than 100 euros.
The report comes ahead of a weekend meeting of G8 energy ministers and their China, India and South Korea peers in Aomori in northern Japan, where they will try to agree on the role of consumer nations in stemming oil's five-year price rally.
Tanaka said non-IEA members such as China, India and other developing countries must conserve energy to achieve the target as they are already big emitters and are likely to emit more.
"Some kind of financial facility or some scheme is needed to help developing countries participate more easily," Mizuho's Hibino said. "It would be hard for the IEA to achieve the goal without the participation of developing countries."
($1=.6417 Euro)
(Additional reporting by Emma Graham-Harrison in BEIJING; Writing by Jonathan Leff; Editing by Michael Urquhart)
Study: $45 trillion needed to combat warming
Joseph Coleman, Associated Press Yahoo News 6 Jun 08;
The world needs to invest $45 trillion in energy in coming decades, build some 1,400 nuclear power plants and vastly expand wind power in order to halve greenhouse gas emissions by 2050, according to an energy study released Friday.
The report by the Paris-based International Energy Agency envisions a "energy revolution" that would greatly reduce the world's dependence on fossil fuels while maintaining steady economic growth.
"Meeting this target of 50 percent cut in emissions represents a formidable challenge, and we would require immediate policy action and technological transition on an unprecedented scale," IEA Executive Director Nobuo Tanaka said.
A U.N.-network of scientists concluded last year that emissions have to be cut by at least half by 2050 to avoid an increase in world temperatures of between 3.6 and 4.2 degrees above pre-18th century levels.
Scientists say temperature increases beyond that could trigger devastating effects, such as widespread loss of species, famines and droughts, and swamping of heavily populated coastal areas by rising oceans.
Environment ministers from the Group of Eight industrialized countries and Russia backed the 50 percent target in a meeting in Japan last month and called for it to be officially endorsed at the G-8 summit in July.
The IEA report mapped out two main scenarios: one in which emissions are reduced to 2005 levels by 2050, and a second that would bring them to half of 2005 levels by mid-century.
The scenario for deeper cuts would require massive investment in energy technology development and deployment, a wide-ranging campaign to dramatically increase energy efficiency, and a wholesale shift to renewable sources of energy.
Assuming an average 3.3 percent global economic growth over the 2010-2050 period, governments and the private sector would have to make additional investments of $45 trillion in energy, or 1.1 percent of the world's gross domestic product, the report said.
That would be an investment more than three times the current size of the entire U.S. economy.
The second scenario also calls for an accelerated ramping up of development of so-called "carbon capture and storage" technology allowing coal-powered power plants to catch emissions and inject them underground.
The study said that an average of 35 coal-powered plants and 20 gas-powered power plants would have to be fitted with carbon capture and storage equipment each year between 2010 and 2050.
In addition, the world would have to construct 32 new nuclear power plants each year, and wind-power turbines would have to be increased by 17,000 units annually. Nations would have to achieve an eight-fold reduction in carbon intensity — the amount of carbon needed to produce a unit of energy — in the transport sector.
Such action would drastically reduce oil demand to 27 percent of 2005 demand. Failure to act would lead to a doubling of energy demand and a 130 percent increase in carbon dioxide emissions by 2050, IEA officials said.
"This development is clearly not sustainable," said Dolf Gielen, an IEA energy analyst and leader for the project.
Gielen said most of the $45 trillion forecast investment — about $27 trillion — would be borne by developing countries, which will be responsible for two-thirds of greenhouse gas emissions by 2050.
Most of the money would be in the commercialization of energy technologies developed by governments and the private sector.
"If industry is convinced there will be policy for serious, deep CO2 emission cuts, then these investments will be made by the private sector," Gielen said.
World must spend trillions to cut emissions: IEA
Daniel Rook, Yahoo News 6 Jun 08;
The world must spend about one percent of its total income every year to halve greenhouse gas emissions by 2050, the IEA said Friday, calling for an "energy technology revolution" to curb global warming.
Unless governments act now, carbon dioxide emissions will rise by 130 percent by the middle of the century and oil demand will grow 70 percent, the International Energy Agency (IEA) said in a report published in Tokyo.
To halve carbon dioxide emissions, the world would need to spend an additional 45 trillion US dollars on clean energy technologies by 2050 -- or 1.1 percent of average annual gross domestic product over the period, it estimated.
"There should be no doubt that meeting the target of a 50 percent cut in emissions represents a formidable challenge," Nobuo Tanaka, executive director of the Paris-based IEA, told a press conference here.
"We would require immediate policy action and technological transition on an unprecedented scale. It would essentially require a new global technological revolution which would completely transform the way we produce and use energy."
Halving emissions would require on average about 35 coal and 20 gas-fired power plants every year to be fitted with the technology to capture and store the carbon dioxide they belch out, the report said.
The world would also need to build an additional 32 new nuclear power plants every year along with 17,500 wind turbines.
Tanaka noted that, according to the UN-backed Intergovernmental Panel on Climate Change, such deep emission cuts are needed to limit global warming to two to three degrees C (36 to 37 degrees F) up to the end of the century.
The IEA said no single form of energy or technology could solve the problem alone, calling for increased use of carbon dioxide capture and storage, renewable and nuclear energy and better energy efficiency.
The IEA was created as an offshoot of the Organisation for Economic Cooperation and Development amid the first oil shocks of the 1970s to monitor the oil market and energy strategies for advanced economies.
Rich and poor nations are divided on what action to take to tackle climate change, despite growing fears that global warming could cause the extinction of some plants and animals within the century and put millions of people at risk.
Rapid economic growth in emerging countries such as China and India, as well as soaring oil and gas prices, are hampering efforts to reduce consumption of coal, a high-polluting source of energy, the IEA said.
In China and India, "huge savings have got to be made in coal (consumption). That's not going to be easy," said IEA deputy executive director William Ramsay.
"Their markets are not going to easily adopt these kinds of expensive technologies," while consumers may be unhappy paying higher prices for electricity generated by clean power sources, he said.
"You can see on the streets of India now that raising the price of energy is very dangerous politically," Ramsay added.
The Indian government has faced angry protests and strikes this week over a decision to hike fuel prices.
Oil prices struck record peaks above 135 dollars last month, up five-fold since 2003 amid supply worries and rising demand in emerging economies.
The more than 600 page IEA report was released on the eve of the start of a meeting between the energy ministers of the Group of Eight (G8) industrialised nations as well as China, India, South Korea in northern Japan.
Together the 11 countries release 65 percent of the carbon dioxide emissions blamed for global warming. The G8 groups Britain, Canada, Italy, France, Germany, Japan, Russia and the United States.
