General – COP28
At the COP28 climate summit IEA chief Fatih Birol said fossil fuel use will peak in 2030, and urges companies to lead switch to green energy: convert to renewables or face decline.
“We have to find a way to reduce fossil fuel consumption, and as such there is an important role that the oil and gas industry can play. I very much hope that they can show in Dubai that they can be part of the solution when it comes to tackling climate change.”
Birol warned that oil and gas companies would find it more difficult to operate in future. “It is not just people in Europe or the US, or Australia, who are raising the alarm – more and more people around the world, from the streets of New Delhi and Jakarta, to Nairobi and Rio. They are seeing the clear links between the continued high use of fossil fuels and the increasingly severe climate impacts they are seeing almost on a daily basis.”
Governments should bring in policies to encourage the switch, but even if they did not, on current policies fossil fuel use would peak by 2030, leaving companies with an uncertain future, he warned.
Currently only 2.5% of the capital investment of oil and gas companies goes towards renewable energy, which Birol said was insufficient.
Birol warned that fossil fuel companies must prepare now for an orderly decline rather than try to expand or continue their operations. He said the skills and technology such companies already possess could be used in renewable energy generation, if they refocused their aims.
Many experts and countries, including the EU, now regard the COP28 target of tripling renewables by 2030 to be insufficiently stretching, as recent analysis has shown it is likely to be achieved on current trajectories.
Birol also repeated his view that simply investing in carbon capture and storage (CCS) would not give companies a licence to operate in future. “It’s a fantasy,” he said in an interview with The Guardian this week.
According to Birol CCS technology will never scale up to cover the emissions of the oil and gas sector if they carry on with business as usual, and its use should be concentrated among sectors such as steel and cement that face the greatest difficulty in switching from fossil fuels.
Current investment in CCS is about $4bn (£3.15bn) a year, but it would need to be $4tn a year to cover the emissions from fossil fuel use, amounts which Birol said were “implausible”.
