Rethinking Emissions Reduction

THE HAGUE – Whether at United Nations climate-change summits or one of the many “green growth” forums, renewables and energy efficiency are consistently regarded as the solution to global warming. Even the coal industry adopted the efficiency line in its Warsaw Communiqué, released ahead of the UN’s COP19 summit last November. But a closer look at the global energy system, together with a more refined understanding of the emissions challenge, reveals that fossil fuels will likely remain dominant throughout this century – meaning that carbon capture and storage (CCS) may well be the critical technology for mitigating climate change.

The widespread focus on efficiency and renewable energy stems from the dissemination of the Kaya Identity, which the Japanese economist Yoichi Kaya developed in 1993. Kaya calculated CO2 emissions by multiplying total population by per capita GDP, energy efficiency (energy use per unit of GDP), and carbon intensity (CO2 per unit of energy). Given the impracticality of winning support for proposals based on population management or limits on individual wealth, analyses using the Kaya Identity tend to bypass the first two terms, leaving energy efficiency and carbon intensity as the most important determinants of total emissions.

But this convenient interpretation does not correspond to reality. The fact is that the rate at which CO2 is being released into the ocean-atmosphere system is several orders of magnitude greater than the rate at which it is returning to geological storage through processes like weathering and ocean sedimentation. In this context, what really matters is the cumulative amount of CO2 being released over time – a fact that the Intergovernmental Panel on Climate Change recognized in its recently released Fifth Assessment Report.

Since the industrial age began some 250 years ago, roughly 575 billion tons of fossil-fuel and land-fixed carbon – more than two trillion tons of CO2 – have been released into the atmosphere, leading to a shift in the global heat balance and a likely 1°C increase in surface temperature (the median of a distribution of outcomes). At the current rate, a trillion tons of carbon, or some 2°C of warming, could be reached as early as 2040.

This view does not align with the prevailing mechanisms for measuring progress on emissions reduction, which target specific annual outcomes. While reducing the annual flow of emissions by, say, 2050 would be a positive step, it does not necessarily guarantee success in terms of limiting the eventual rise in global temperature.

From a climate perspective, the temperature rise over time is arguably more a function of the size of the fossil-fuel resource base and the efficiency of extraction at a given energy price. As supply-chain efficiency increases, so does the eventual extraction and use of resources and, ultimately, the accumulation of CO2 in the atmosphere. This means that efficiency may drive, not limit, the increase in emissions.

In fact, since the Industrial Revolution, efficiency through innovation has revolutionized just a handful of core energy-conversion inventions: the internal combustion engine, the electric motor, the light bulb, the gas turbine, the steam engine, and, more recently, the electronic circuit. In all of these cases, the result of greater efficiency has been an increase in energy use and emissions – not least because it improved access to the fossil-resource base.

Countries’ efforts to rely on renewable energy supplies are similarly ineffective, given that the displaced fossil-fuel-based energy remains economically attractive, which means that it is used elsewhere or later. And, in the case of rapidly developing economies like China, renewable-energy deployment is not replacing fossil fuels at all; instead, renewables are supplementing a constrained fuel supply to facilitate faster economic growth. In short, placing all bets on renewable-energy uptake outpacing efficiency-driven growth, and assuming that enhanced efficiency will drive down demand, may be a foolish gamble.

Instead, policymakers should adopt a new climate paradigm that focuses on limiting cumulative emissions. This requires, first and foremost, recognizing that, while new energy technologies will eventually outperform fossil fuels both practically and economically, demand for fossil fuels to meet growing energy needs will underpin their extraction and use for decades to come.

Most important, it highlights the need for climate policy that focuses on the deployment of CCS systems, which use various industrial processes to capture CO2 from fossil-fuel use and then store it in underground geological formations, where it cannot accumulate in the biosphere. After all, consuming a ton of fossil fuel, but capturing and storing the emissions, is very different from shifting or delaying its consumption.

Unfortunately, a policy framework built on this thinking remains elusive. The European Union’s recently released 2030 framework for climate and energy policies maintains the focus on domestic policies aimed at boosting efficiency and deployment of renewable energy. While the framework mentions CCS, whether the EU commits to its deployment remains to be seen.

Rallying support and political will for CCS – rather than for derivative approaches that misconstrue the nature of the problem – will be the real challenge for 2030 and beyond.

David Hone is Chief Climate Change Adviser at Royal Dutch Shell.

Copyright: Project Syndicate, 2014.
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