Category: Greenhouse gases

A ten year reduction challenge for the USA

dchone May 4, 2021

In April, at the opening of the White House Climate Summit, President Biden announced the United States Nationally Determined Contribution (NDC) for the period up to 2030, encompassing a target of greenhouse gas reductions 50-52% below 2005 levels. The US Greenhouse Gas inventory is available on the US EPA website and is summarised in the table below.

Sector and gases(Mt CO₂e)	2005	Latest data for 2019

CO₂ Fossil Fuel Combustion	5753.5	4856.7
CO₂ Non-Energy & Industrial	381	399.1
CH₄ from all sources	686.1	659.7
N₂O from all sources	455.8	457.1
HFCs, PFCs, SF₆, NF₃ from various industries	146.5	185.6
Total Emissions (Sources)	7423	6558.3

LULUCF Emissions	16.8	23.5
LULUCF Carbon Stock Change	(804.8)	(812.7)

Net Emissions (Sources & Sinks)	6635.0	5769.1

Given a baseline of 6635 Mt CO₂e, a 50% reduction in 2030 would require US emissions to be 3318 Mt or lower in that year. The 2019 data represents a reduction of 13% over 2005, so the reduction in the next 10 years must be nearly triple that of the last 15 years. The reduction seen to date from fossil fuel combustion is running slightly ahead of the overall improvement, with a reduction from 2005 to 2019 of nearly 16%.

The goal that President Biden put forward is aligned with a strategy that is designed to achieve a goal of net-zero emissions for the US in 2050. Recently, the Shell Scenario team released a US Sketch outlining one possible pathway to such an outcome. The Sketch is illustrated below (N.B. 2020 figures are a pre-pandemic view of US emissions which the US is approaching again as the recovery gains momentum).

The Sketch provides the opportunity to look at the nature of the transition required in the 2020s for the NDC. The Sketch energy system emissions in 2030 are 3440 Mt against a 2005 baseline of 6030 Mt (small differences in baselines result from different categorizations of emissions), or a reduction of 43%. While this isn’t exactly aligned with the NDC, it could be in that the NDC makes specific reference to a major expansion of sink capacity through enhanced soil carbon uptake in the agricultural sector.

Key elements of the journey to 2030 outlined for the US in the Sketch are as follows;

In 2020 (pre-COVID calculation) the US generated 3970 TWh of electricity, with 80% from coal, gas and nuclear. Solar and wind made up less than 10% of the total. By 2030 in the Sketch, the generation mix has shifted to natural gas and solar each making up about 25% of the total, with wind, nuclear and coal combined at around 40%. Notably, total electricity generation has increased to 5720 TWh, or 43% over 2020. This is in a pathway that still sees electricity system emissions at 600 Mt in 2035, the year President Biden has targeted for a zero emission system. His goal is about 5 years ahead of the Sketch.
The increase in electricity consumption comes from an increasing proportion of electricity in final energy, displacing gasoline in cars, natural gas in homes and coal in industry. Electrification is a major lever for decarbonisation. The proportion of electricity as final energy rises in a decade from 22% to 35%, breaking a near century long trend which if continued, would otherwise see it rise to 25% at most.
Over the 2020s, solar generation of electricity grows fastest, increasing by a factor of nearly 12 in a decade. The U.S. installed 19.2 gigawatts (GWdc) of solar PV capacity in 2020 to reach 97.7 GWdc of total installed capacity. With a utilisation factor of 15-20%, this could be expected to generate around 150 TWh of electricity, although the Energy Information Agency reported a total of 130 TWh (perhaps because the capacity at the start of the year was 79 GWdc). In any case, capacity by 2030 will need to grow to at least 1 TWdc, assuming some efficiency improvement in new installations compared to existing facilities. With a year-on-year installation growth of 30%, the US could be installing some 260 GWdc per year by 2030, bringing the total installed capacity to 1.2 TW by the end of that year. Very large scale energy storage will also have to deploy to support solar.
The Sketch also shows a three-fold increase in wind generation throughout the 2020s and importantly, no decline in nuclear generation. The latter becomes increasingly important as other non-intermittent generation sources decline in use.
Electric vehicle (EV) deployment is an important part of the trend towards electrification and it emerges rapidly in the Sketch. By 2030 the US will need to see 20% of all passenger vehicle use as electric, with hydrogen fuel cell vehicles rapidly appearing in the large SUV sector. At the moment, there are about 1.5 million EVs on the road, out of a total US passenger vehicle fleet of some 280 million. To reach a level of 20% EVs in terms of use, sales will need to climb rapidly from some 400,000 vehicles per year now, to over 13 million in 2030, or nearly 80% of all sales. This represents a year-on-year growth rate in EV sales of 42% through the decade.
Road freight makes less use of electricity, although it does impact the lighter end of the freight market. For larger, longer haul freight trucks, hydrogen emerges during the 2020s, with some 200,000 trucks on the road by end of the decade. This is still relatively small, but the sector is non-existent today. In the second half of the century in the Sketch, hydrogen becomes the dominant fuel for heavy road freight.
Natural gas, propane and oil are used widely in the US for cooking and/or heating in homes. Although the majority use electricity for cooking, heating is provided mostly by gaseous hydrocarbon fuels. In the US Sketch, heating and cooking in residences shifts from 13% electricity to 42% electricity in just a decade. Of all the transition tasks ahead, this may be the most challenging in that it involves convincing millions of households, individual consumers and landlords to change their behaviour, refit existing properties, invest money for the change and in some instances make use of a less preferred energy option.
While electricity already plays a significant role in light industry, this is not the case for heavy industry where very high temperatures and high thermal loads are often required for conversion processes. Heavy industry energy use in the US is currently three-quarters gas, coal and biomass and one quarter electricity. This begins to shift rapidly and by 2030 in the Sketch, 40% of energy demand for heavy industry is supplied by electricity. In addition, hydrogen is emerging, with the first industrial installations making commercial use of this fuel. While the amount is small in 2030 it could mean significant development, design and engineering of new processes in a limited amount of time. Alternatively, the amount could point to natural gas being topped up with hydrogen as a mixed fuel for industrial furnaces, prior to converting whole processes over to hydrogen based fuels.
The many changes across the energy landscape result in steep decline in the use of fossil fuels in the Sketch, with coal falling fastest. By 2030 there is a 40% reduction in coal use, a 14% reduction in natural gas and a 25% reduction in oil within the economy, compared to 2020 (pre-COVID) use.
But even by 2050 in the Sketch, natural gas and oil still play an important but significantly diminished role in the US economy. That points to the need for carbon capture and storage (CCS), both directly linked to facilities and indirectly as an atmosphere removal mechanism (e.g. BECCS). The US already has the most mature CCS industry in the world, underpinned by years of enhanced oil recovery using carbon dioxide. But an order of magnitude change is required here as well during the 2020s, with a shift from some 30 mtpa carbon dioxide stored to some 300 mtpa.

While the Sketch does not require nature based solutions (NBS) for the US energy system to reach net-zero emissions by 2050, natural carbon sinks do provide an additional lever to support the transition and the NDC also discusses this aspect of emissions mitigation. In the US, national forests cover 193 million acres, an area larger than Texas. Apart from their significant bioenergy potential, forests act as natural carbon sinks. The US could reduce CO₂ emissions by up to 300 million tons a year by 2050 through afforestation – the planting of new trees where there were none before. While new forests represent significant additional sinks, there is also potential to expand areas such as wetlands and mangrove swamps, and perhaps most importantly to encourage farmers to adopt practices that enhance soil carbon. The US NDC references this opportunity.

The rates of change outlined above are substantial, with year-on-year growth rates for several new energy technologies of 20-50%, depending on the sector. While growth at this level can be sustained when a sector is very small and this has been observed for renewable energy deployment, it becomes increasingly difficult as the sector grows and absolute levels of deployment become very large. Many of the sectors mentioned will face this issue during the 2020s. Nevertheless, the Sketch was designed to show what is possible given the right policy levers for innovation and deployment, sufficient and targeted financing and overall transition design.

Note: Scenarios don’t describe what will happen, or what should happen, rather they explore what could happen. Scenarios are not predictions, strategies or business plans. Please read the full Disclaimer here.

Meeting the goals of the Paris Agreement

dchone March 27, 2018

Over the past few months I have been deeply involved with my colleagues in the Shell Scenario team preparing a new scenario that illustrates a technically possible but challenging pathway for society to meet the goals of the Paris Agreement on climate change. From an emissions mitigation perspective, those goals are as follows;

Holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 °C above pre-industrial levels
. . . aim to reach global peaking of greenhouse gas emissions as soon as possible;
. . . achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century.

Today, that scenario is being launched as an extension of the two existing global Shell scenarios already in use, Mountains and Oceans. Both those 2013 scenarios achieve the goal of net-zero emissions, but not early enough to also ensure the rise in average surface temperature stays well below 2°C, rather they plateau at around 2.5°C. The new scenario, named Sky, sees a rapid energy transition taking place over 50 years as the Paris Agreement moves into full operation and countries ratchet their nationally determined contributions (NDC) in two five-year cycles through the 2020s towards a pathway that reaches net-zero emissions in the energy system by 2070. The ‘ratchet’ mechanism is the underlying driver of the Paris Agreement, although the formal way in which it will function is still being negotiated. But it is critical that it works, given that the first round of NDCs result in a ~3°C pathway, or possibly higher.

The Sky outlook is not a given though; it sits in the top right corner of a classic scenario matrix, one which embraces both global leadership and the need for mechanisms and approaches to share common interests. Both will be required to address the climate issue, but on a consistent and long-term basis. In 2014 and 2015 the world saw a flash of the potential that is there as the Paris Agreement was brought to fruition.

Sky means big transformations for society on many fronts; we identified seven major changes for the coming decades for success. Sky requires a complex combination of mutually reinforcing drivers being rapidly accelerated by society, markets, and governments.

From now to 2070 –

A change in consumer mindset means that people preferentially choose low-carbon, high-efficiency options to meet their energy service needs.
A step-change in the efficiency of energy use leads to gains above historical trends.
Carbon-pricing mechanisms are adopted by governments globally over the 2020s, leading to a meaningful cost of CO2 embedded within consumer goods and services.
The rate of electrification of final energy more than triples, with global electricity generation reaching a level nearly five times today’s level.
New energy sources grow up to fifty-fold, with primary energy from renewables eclipsing fossil fuels in the 2050s.
Some 10,000 large carbon capture and storage facilities are built, compared to fewer than 50 in operation in 2020.
Net-zero deforestation is achieved. In addition, an area the size of Brazil being reforested offers the possibility of limiting warming to 1.5°C, the ultimate ambition of the Paris Agreement.

But Sky is not without its challenges.

For example, the existing energy system has been under pressure for much of this century with rapidly rising demand, driven by population growth, development and even a much-heralded saviour, energy efficiency. The connections people make through international travel have already doubled in the first two decades of this century (measured in terms of international air travel arrivals), partly through the efficiency drives by airlines and aeroplane manufacturers which in turn lower costs.

Coal also remains a fuel of choice, despite its higher CO2 emissions and local air quality impact in some cities. A stark reality of the early 21st century is the lack of a clear development pathway for an emerging economy that doesn’t include coal. Coal is a relatively easy resource to tap into and make use of. It requires little technology to get going but offers a great deal, including electricity, heating, industry, and, very importantly, smelting to make iron. Although solar PV and wind offer clean, distributed electricity, benefiting households, electricity alone is currently insufficient for rapid urbanisation and industrialisation, including the construction of cities and the manufacture of products such as automobiles and appliances.

Nevertheless, Sky shows that achieving net-zero emissions in just 50 years is technically possible, but there is no margin for interruption, stalled technologies, delayed deployment, policy indecision, or national back-tracking. Rather, it requires a rapid acceleration in all aspects of an energy transition and particularly robust policy frameworks that target emissions. Success can be accomplished only through a broad process that is embraced by societies, led by governments, and lightly coordinated by organisations including the UNFCCC, the EU, ASEAN, and others.

Perhaps the most interesting aspect of the work over the past months has been the collaboration with the MIT Joint Program on the Science and Policy of Global Change. They used their Integrated Global System Modelling (IGSM) framework to assess the rise in global average surface temperature that we might see under the Sky transition, which then led to the recognition that the extended ambition of the Paris Agreement, limiting the temperature rise to 1.5°C, was still a possibility. It wouldn’t be the energy transition alone that could deliver that, but the addition of a significant and rapid program of reforestation happening around the world. Nature based solutions (NBS) will be very important over the coming decades.

Sky on its own lands squarely between 1.5 and 2°C, meeting the primary goal of the Paris Agreement, but with large scale reforestation gives the world a shot at 1.5°C. The MIT report can be found here.

You can read the full story on the Shell website at www.shell.com/skyscenario.

Note: Scenarios are not intended to be predictions of likely future events or outcomes and investors should not rely on them when making an investment decision with regard to Royal Dutch Shell plc securities. Please read the full cautionary note in www.shell.com/skyscenario.

Drivers behind flattening CO2 emissions

dchone March 29, 2017

The International Energy Agency (IEA) recently reported that carbon dioxide emissions from energy use remained flat in 2016, the third year in a row. This is a noticeable departure from the 21^st century trend which has seen global carbon dioxide emissions rise by some 40% in just 14 years. The Guardian reported this story and added the by-line “International Energy Agency report puts halt in emissions from energy down to growth in renewable power”. But the story within the energy system has more facets than this (Data sourced from the BP Statistical Review of World Energy).

Although global growth hasn’t been outstanding in recent years, it has nevertheless chugged along at around 2.5-3%. Energy use has also increased, albeit at a lower rate of some 1% per annum. This is at the lower end of the expected range of energy vs. GDP, but it is probably too early to say that this represents a longer term shift in this relationship. However, this could be the case if efficiency improvements can outpace economic development or at least come close.

Renewable energy is growing rapidly, although this is mainly in the area of electricity generation. From 2014 to 2015 solar and wind generation increased globally by about 200 TWh, which was nearly equal to the overall growth in electricity generation for that year. As an aside, BP reported that the overall electricity growth rate in 2015 was down on 2014 (2.4%) and remained well below the 10-year trend (2.8%). This is slightly concerning as electrification of the energy system is a key requirement for long term emissions reduction. Electricity generation needs to be accelerating compared to overall energy demand growth.

Although the 2016 data isn’t available yet, BP reported that coal use declined globally in 2015 vs. 2014 by 1.8% and natural gas use increased. While most of this could be attributed to the USA and Canada, China also saw a notable coal decline along with growth in natural gas use. The global coal use reduction is equivalent to nearly 300 million tonnes CO2, or about 0.8% of global emissions. Any replacement with natural gas would result in about half the emissions. This is very noticeable in the USA where coal use fell in 2015 by 13%, natural gas use grew by 3% (but against a larger absolute use), oil demand increased by 3%, but emissions declined by 2.6%.

Coal use is declining for a number of reasons;

The surge in natural gas production in the USA in particular, triggering the closure of older coal fired power stations that cannot meet new environmental regulations.
Air quality concerns in China, leading to a shutdown of coal fired industry and power generation around the major cities.
Some mothballing or closure of overcapacity in metallurgical industries in China.
The impact of a modest carbon price in a number of jurisdictions and some government imposed moratoriums on new coal generation construction (e.g. Canada).

However, coal use continues to increase sharply in a number of developing countries such as Vietnam, the Philippines, Malaysia, India, Colombia and Indonesia. Current expectations are that this will continue.

Oil use continues to increase, with BP reporting a global rise from 2014 to 2015 of 2%.

The final story is therefore one of several parts and it would appear that this trend has continued into 2016 although further data will be required for verification;

Global growth is modest, but energy use increases are trending at the lower part of the expected rise for this level of economic growth.
Coal use is declining, with natural gas filling much of the gap but at lower emissions.
Renewables are growing quickly, covering most of the increase in electricity generation, but not quite all.
Oil demand continues to increase, with its growing emissions being offset by the reduction in coal use.

The end result is that flattening in global emissions that has been seen for three years now.

Another momentous step?

dchone October 21, 2016

Following the ICAO deal to offset the global growth in aviation emissions and the Paris Agreement passing the 55 / 55 criteria for entry into force, a third major announcement has followed in as many weeks; the agreement of an addendum to the Montreal Protocol (agreed in 1987 to progressively eliminate the use of chlorinated fluorocarbons or CFCs, coming into force in 1989) which will bring the HFC family of gases into that process, leading to their eventual elimination from day to day use.

Hydrofluorocarbons or ‘HFCs’ have been increasingly used this century as an alternative to ozone damaging CFCs in refrigeration systems. Though HFCs provide an effective alternative to CFCs, they are also powerful greenhouse gases. A snapshot of current greenhouse gas emissions to atmosphere highlights the HFC issue; today they represent approximately 1 Gt on a CO₂ equivalent basis, or about 2% of the total GHG problem.

While 2% is not insignificant, being just above the impact that aviation currently has on the climate issue, it is the longer term impact that the growth in use of these products has that is the main cause for concern. India alone could build upwards of 400 million refrigerators over the coming 20 years. But following seven years of negotiations, the 197 Montreal Protocol parties reached a compromise, under which developed countries will start to phase down HFCs by 2019. Developing countries will follow with a partial freeze of HFCs consumption levels in 2024, with some countries freezing consumption in 2028. By the late 2040s, all countries are expected to consume no more than 15-20 per cent of their respective baselines. A small group of countries is treated more leniently owing to the very high local temperatures experienced during much of the year.

This is an important agreement, but I certainly didn’t expect to see the claim that came from UNEP (United Nations Environmental Programme) that the Kigali Amendment to the Montreal Protocol (as this was agreed at the 28^th Meeting of the Parties to the Montreal Protocol at their meeting in Kigali, Rwanda) was the equivalent of shaving 0.5°C from the anticipated warming of the climate system. Secretary of State John Kerry rounded this up slightly and referred to the result as a 1°F achievement. The claim was reminiscent of the pre-Paris statement by the UNFCCC that the INDCs submitted had already reduced warming to 2.7°C, a story that carried right through the December COP and gave great confidence to the negotiators. Such a number could be arrived at with some big assumptions about the future but most commentators put the level of warming after the INDCs (and assuming they are delivered) at something around 3.8°C (which was at least less than 4+°C).

The source of the 0.5°C figure is a series of academic papers, such as a 2013 paper from Scripps Institution of Oceanography (The role of HFCs in mitigating 21st century climate change, Y. Xu1, D. Zaelke, G. J. M. Velders, and V. Ramanathan). This paper notes that most HFCs now in use have relatively short lifetimes in the atmosphere in comparison with long-lived GHGs, such as CO2 and N2O (nitrous oxide) and are therefore referred to as short-lived climate pollutants (SLCPs). The global average lifetime, weighted by the production of the various HFCs now in commercial use, is about 15 years, with a range of 1 to 50 years. But the chemicals have very high global warming potentials (e.g. over 4000 for HFC-143a).

Therefore, HFCs have a significant impact on radiative forcing in the years immediately after release into the atmosphere, but their impact on peak warming when that occurs depends more on the level of HFC emissions at that time rather than the emissions now or in the near term. As such, the warming that they induce is nearer term and tends to mean that we will reach a certain temperature earlier than we might have, even if the eventual peak warming remains the same. Peak warming is dictated primarily by cumulative CO2 emissions, with the approximate relationship of 2°C for every trillion tonnes of carbon (or 3.7 trillion tonnes CO2) emitted.

Nevertheless, some significant warming numbers arise, although they are very dependent on the HFC demand projections and scenarios that are developed. Mitigation of the potential growth of HFCs is shown to play a significant role in limiting the warming to below 2°C this century and could contribute additional avoided warming of as much as 0.5°C by 2100. Using the lower limits of BAU increase of HFC, 0.35°C warming is shown to be avoided.

Most importantly though, this paper emphasizes that HFC mitigation should not be viewed as an “alternative” strategy for avoiding the 2°C peak warming, but rather as a critical component of a strategy that also requires mitigation of CO2 and the other SLCPs. The focus of the study presented was on near-term warming over the next several decades to end of the century. For the longer-term (century and beyond), mitigation of CO2 would be essential for a significant reduction in the warming.

A further feature of the Kigali Amendment was an agreement to provide adequate financing for HFCs reduction, the cost of which is estimated at billions of dollars globally. The exact amount of additional funding will be agreed at the next Meeting of the Parties in Montreal, in 2017. Grants for research and development of affordable alternatives to hydrofluorocarbons will be the most immediate priority. But this financing requirement may still cause problems, particularly if the US Senate requires oversight of the amendment, given it ratified the Montreal Protocol in the first place. With the ink barely dry on the Kigali documents, The Guardian was already reporting that in the view of some legal experts the US Senate will have to vote on the issue.

Debating the global temperature goal

dchone August 5, 2016

Within the Decision Text supporting the Paris Agreement, paragraph II.21 calls on the IPCC as follows;

21. Invites the Intergovernmental Panel on Climate Change to provide a special report in 2018 on the impacts of global warming of 1.5 °C above pre-industrial levels and related global greenhouse gas emission pathways;

This has prompted a number of academic institutions and climate scientists to start publishing on the issue of a 1.5°C goal, with much more likely to come in the months ahead. One such paper (Huntingford, C. and Mercado, L. M. High chance that current atmospheric greenhouse concentrations commit to warmings greater than 1.5 °C over land. Sci. Rep. 6, 30294; doi: 10.1038/srep30294 (2016).) was reported on recently by the BBC, under the heading Debate needed on 1.5C temperature target.

In fact the paper was about where we are today in terms of temperature and reaches a similar conclusion to the one that I reported on recently after attending an MIT Joint Program forum. At that meeting, the response to my question about current levels of warming was as follows;

. . . . current warming is around 1.1°C since pre-industrial times, but that there is more to the story than this. The climate system is not at equilibrium, with the oceans still lagging in terms of heat uptake. Therefore, if the current level of carbon dioxide in the atmosphere was maintained at some 400 ppm, the surface temperature would rise by another few tenths of a degree before the system reached an equilibrium plateau.

Similarly, the paper reported on by the BBC, argues much the same line;

There is strong evidence that even for current levels of atmospheric GHGs, there is a very high probability that the planet is committed to a mean warming over land greater than 1.5 °C relative to pre-industrial times. Such warming could be greater than 2.0 °C, and in particular for large continental regions away from coastlines.

While a debate about the global goal wasn’t a feature of the paper itself, the BBC interviewed the authors and reported that while they believed it to be a good idea to have an “aspirational” 1.5°C goal in the Paris agreement, that nevertheless if the world is to take 1.5°C seriously, then a serious discussion needs to be held about the implications of that goal. The author of the paper is quoted as saying “I think there needs to be a very thoughtful debate about what’s to be gained at these different temperature levels, if approaching the lower levels meant severely damaging the economy,”.

Such a discussion has been largely absent, replaced with a somewhat myopic focus on 2°C and now “well below 2°C, with a view to 1.5°C”. I discussed this at some length in my first book, drawing on the work of the MIT Joint Program in their 2009 report Analysis of Climate Policy Targets under Uncertainty. In that report the authors demonstrated that even a modest attempt to mitigate emissions could profoundly affect the risk profile for equilibrium surface temperature. This is illustrated below with five mitigation scenarios, from a ‘do nothing’ approach (Level 5) to a very stringent climate regime (Level 1).

An important feature of the results is that the reduction in the tails of the temperature change distributions is greater than the shift in the temperature goal (represented by the median of the distribution). For example, the Level 4 stabilization scenario reduces the median temperature change by the last decade of this century by 1.7 ºC (from 5.1 to 3.4 ºC), but reduces the upper 95% bound by 3.2 ºC (from 8.2 to 5.0 ºC). In addition to being a larger magnitude reduction, there are reasons to believe that the relationship between temperature increase and damages is non-linear, creating increasing marginal damages with increasing temperature (e.g., Schneider et al., 2007). These results illustrate that even relatively loose constraints on emissions reduce greatly the chance of an extreme temperature increase, which is associated with the greatest damage.

But the other focus of the Paris Agreement stands apart from such debate. As previously discussed in several postings, Article 4 calls for a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century, i.e. a state of net-zero emissions. In fact such an outcome is eventually required irrespective of the temperature outcome; without it warming continues.

Net-zero emissions arguably brings a more practical focus to the task of emissions mitigation. It defines an end-point and allows a discussion on the pathway there, the types of technologies required and the shape of the energy economy once achieved. All of this features in the new supplement to the Shell New Lens Scenarios, A Better Life with a Healthy Planet: Pathways to Net-Zero Emissions.

Scenarios are part of an ongoing process used in Shell for more than 40 years to challenge executives’ perspectives on the future business environment. They are based on plausible assumptions and quantification, and are designed to stretch management thinking and even to consider events that may only be remotely possible.

Where are we now?

dchone June 17, 2016

Last week I presented a simple analysis of the temperature data over the last 50+ years which showed that there was good reason to think that the global surface temperature was rising by about 0.18°C per decade. But a further question to ask is when the current upward trend really started in earnest and therefore where are we today against a baseline of the pre-industrial temperature (i.e. 1850s or thereabouts). This is an important question as we have collectively established a desire to keep warming well below 2°C, but with the real prize being to limit this even further and ideally to 1.5°C.

If the current strong warming trend started in the middle of the last century, say in the post-war boom, then at 0.18°C per decade that results in warming over that period of nearly 1.2°C. The 1950s were also presumably warmer than the 1850s as CO2 levels had risen by some 30 ppm (parts per million) over that period, which argues for the current level of warming to be something more than 1.2°C.

Another way of looking at this is to use the climate sensitivity relationship between cumulative carbon and peak warming, which was estimated at 2°C per trillion tonnes of carbon by Myles Allen and his team in their formative paper published in Nature in 2009. A look at the associated Oxford University website will show cumulative carbon now stands at over 600 billion tonnes, which implies associated warming of about 1.2°C.

Yet another way is to seek an answer from a group of climate scientists and I had the opportunity to do just that earlier this week. I am in Boston for the 39^th Forum of the MIT Joint Program on the Science and Policy of Global Change. I posed the question and one respondent (Chatham House Rule applies) argued that current warming is around 1.1°C since pre-industrial times, but that there is more to the story than this. The climate system is not at equilibrium, with the oceans still lagging in terms of heat uptake. Therefore, if the current level of carbon dioxide in the atmosphere was maintained at some 400 ppm, the surface temperature would rise by another few tenths of a degree before the system reached an equilibrium plateau. That would take us perilously close, if not over, the 1.5°C goal of the Paris Agreement. This implies that 1.5°C is only possible if we see a fall in atmospheric carbon dioxide, back below 400 ppm; but noting that it is currently rising at 2-3 ppm per annum.

This isn’t to say there are no routes forward to a 1.5°C outcome, with the Joint Program itself publishing one such pathway back in 2012.

MIT analysed four pathways that result in different temperature outcomes, including 1.5°C. These are shown in the chart above against a business as usual trajectory based on the 2010 post-Copenhagen national pledges.

An immediate drop to net zero by 2015, starting in 2010 (Natural only after 2015).
A very rapid drop to net zero by 2035, but with growth from 2010 to 2030 (Natural only after 2035).
A more extended drop to net zero by 2060, with the decline commencing in 2010 (Alternative).
The IEA 450 scenario, with emissions peaking around 2020 and reaching net zero by 2070 (IEA 450).

Pathway 3 (Alternative) results in peak warming of just over 2°C, but with a return to 1.5°C by the end of the century. Of the three MIT extreme mitigation scenarios, it also represents an outcome that could at least be envisaged, albeit still very challenging to implement.

The ocean also plays an important role here, but in a different way to that described above. Atmospheric CO2 begins to decline once net zero anthropogenic emissions is reached as the ocean continues to take up significant quantities of CO2 from the atmosphere, but with nothing additional being added from human activities. This is because the ocean is also lagging in terms of its ability to dissolve CO2. After some 20-30 years, as the ocean’s upper layer comes into balance with the atmosphere, uptake of CO2 slows. The fall in atmospheric CO2 that results also brings down the global surface temperature by about 0.5°C.

However, this scenario required a very sharp decline in emissions from 2010. Current Paris NDC plans show emissions continuing to rise through to 2030 at which point there are good signs of a plateau but by which time atmospheric CO2 may be at 430-440 ppm. The conclusion from all the above; any pathway that eventually delivers 1.5°C is likely to require a fall in atmospheric carbon dioxide back to 400 ppm or even below.

Why carbon pricing matters – the video

dchone November 26, 2015

The cost of contributions

dchone July 31, 2015

The process of national governments submitting Intended Nationally Determined Contributions (INDCs) to the UNFCCC is well underway, with a number of developing and least developed economies also submitting plans. Most recent amongst these is a detailed and ambitious plan from the government of Kenya.

The Kenya INDC proposes a 30% reduction in national greenhouse gas emissions from a business-as-usual (BAU) trajectory, which it is also very clear in defining. The plan notes that Kenya strives to be a newly industrialized middle income country by 2030. Current emissions are very low, with the majority coming from land use change (LULUCF). In 2010 emissions were 73 MtCO₂eq, with the IEA reporting energy CO₂ emissions of 11.4 Mt for that year. Given the population of 41 million in 2010, that gives an energy linked CO₂ per capita of 0.28 tonnes, amongst the lowest in the world. Kenya has projected BAU emissions of 143 MTCO₂eq by 2030, so that gives them a goal of just on 100 MTCO₂eq for that year on the basis of their INDC.

Kenya has also made it clear that their INDC is subject to international support in the form of finance, investment, technology development and transfer, and capacity building. With some of this support coming from domestic sources, they estimate the total cost of mitigation and adaptation actions across sectors at US$40 billion, through to 2030. My first reaction to this was that it seemed like quite a hefty bill, but better to look at the numbers.

First of all, a few assumptions. These are all open to challenge, but they help frame the issue and allow some assessment of the numbers to at least establish a ballpark estimate of value for money and the implications flowing from that.

I will look at mitigation only, so let’s assume that the $40 billion is split between mitigation and adaptation, but with emphasis on mitigation. That allows ~$10+ billion for major public works and capacity building programmes focussed on areas such as water and agriculture and $20-$30 billion in the energy system.
I will assume that energy system growth and adaptation funding allows for a plateau and then gradual decline in LULUCF emissions, such that by 2050 these are below 10 MT per annum.
A BAU for energy emissions only would see Kenya rising to nearly 2 tonnes per capita by 2030 (current Asia, excluding China) and 6 tonnes per capita by 2050 (approaching current Europe). This would mean extensive use of fossil fuels, but supplemented by their geothermal and hydroelectric resources in particular. This is the pathway that they might be on in the absence of this INDC.
Kenya’s population rises in line with the UN mid-level scenario, i.e. to 66 million by 2030 and 97 million by 2050.

Based on the above, energy emissions could rise to some 120 Mt p.a. by 2030 and 600 Mt p.a. by 2050 under a BAU scenario. But in the INDC scenario, this could be curtailed such that they are at 70 Mt p.a. in 2030 and perhaps as low as 130 Mt p.a. in 2050, or 70-80% below BAU. The 2030 number is the more important one for this calculation as this is what the $20-$30 billion delivers, although the benefits of the investment stretch beyond 2030. However, further additional investment would be required to keep emissions at such a low level through to 2050 as energy demand grows.

The deviation from BAU is nearly 50 Mt p.a. by 2030, with that deviation starting in the early 2020s. If the gains are held through to 2050, then the cumulative emission reduction over the period is around 1 billion tonnes. On a simple 20 year project life with no discounting, that equates to around $25 per tonne of CO₂ against the $20-$30 billion investment in the 2020s. On that basis, this looks like a good deal and is well within the bounds of plausibility. It could equate to a mixture of expanded renewable energy deployment, natural gas instead of coal and possibly some biofuel development for transport.

What is perhaps more interesting is how this scales up across Africa and other parts of the world where energy access is currently limited. If 1-2 billion people globally need support for similar energy infrastructure, that implies a financial requirement of about US$1 trillion over the period 2020-2030 just for mitigation (i.e. 30+ times the Kenya population of 50 million, multiplied by $US30 billion). This equates to $100 billion per annum, which is also the number that was agreed in Copenhagen in 2009 as the call on increased financial flows to developing countries, although that was for both mitigation and adaptation purposes. It also implies that if the world does reach the US$100 billion per annum goal, then most of this will be for mitigation in the least developed economies as they build their 21^st century energy systems.

The flip side of this is that the emerging economies will probably have to self-fund, which argues for the implementation of a carbon price on a far wider basis than is currently envisaged. China is leading the way here, but so too are countries like Mexico and Chile.

The Kenya INDC offers some interesting insight into climate politics in the years to come.

How should national contributions be measured?

dchone April 2, 2015

The last days of March have seen the start of submissions of Intended Nationally Determined Contributions (INDCs) to the UNFCCC. The United States, Switzerland, European Union, Mexico and Russia have all met the requested deadline of the end of Q1 2015. As is expected and entirely in line with the UNFCC request, the INDCs focus on national emissions. After all, this is the way emissions management has always been handled and reported and there is no sign of anything changing in the future.

As was to be expected, the United States submitted an INDC that indicated a 26-28% reduction in national emissions by 2025 relative to a baseline of 2005. This is an ambitious pledge, and highlights the changes underway in the US economy as it shifts towards more gas, backs out domestic use of coal, improves efficiency and installs renewable generation capacity. So far the USA national inventory indicates that the 2020 target is being progressively delivered, although it will be interesting to see whether this trend changes as a result of the sharp reduction in oil prices and a couple of summer driving seasons on the back of that.

My own analysis in 2011 (see below) was that the USA would come close to its 2020 goal, but may struggle to meet it. The different overall level of emissions in the charts is the result of including various sources (e.g. agriculture) and gases, or not.

Direct emissions represent just one view of US emissions. Some would argue that the national inventory should also include embedded emissions within imported products, but this introduces considerable complexity into the estimation.

Another representation of US emissions which is perhaps more relevant to the climate issue is the actual extraction of fossil carbon from US territory. As the climate issue follows a stock model, the development of global fossil resources and subsequent use over the ensuing years is a measure that is closer to the reality of the problem. The larger the resource base that is developed globally, the higher the eventual concentration of carbon dioxide that the atmosphere is likely to reach. This is because the long-term accumulation will tend towards the full release of developed fossil fuel reserves simply because the infrastructure exists to extract them and as such they will more than likely get used somewhere or at some time. This isn’t universally true, as the closure of some uneconomic coal mines in the USA is showing; or are they simply being mothballed?

A look at US carbon commitment to the atmosphere from a production standpoint reveals a different emissions picture. Rather than seeing a drop in US emissions since 2005, the upward trend that has persisted for decades (albeit it a slower rate since the late 1960s) is continuing.

In the case of measured direct emissions, reduced coal use is driving down emissions. But for the extraction case, additional coal is now being exported and the modest drop in coal production is being more than countered by increasing oil and gas production. Total carbon extraction is rising.

While there is no likelihood that national emission inventories will start being assessed on such a basis, it does nevertheless throw a different light onto the picture. In a recent visit to Norway it was interesting to hear about national plans to head rapidly towards net-zero emissions, but for the country to maintain its status as an oil and gas exporter. This would be something of a contradiction if Norway was not such a strong advocate for the development of carbon capture and storage, a strategy which will hopefully encourage others to use this technology in the future.

Getting to net-zero emissions

dchone March 11, 2015

It is looking increasingly likely, but not a given, that a reference to global net-zero emissions or even a specific goal to achieve net-zero emissions by a certain date (e.g. end of the century) will appear in the climate deal that is expected to emerge from the Paris COP at the end of this year. But like many such goals, it is both open to interpretation and raises questions as to how it might actually be achieved.

The background to this is that the issue itself implies that this outcome is necessary. The IPCC says in its 5th Assessment Report;

Cumulative emissions of CO2 largely determine global mean surface warming by the late 21st century and beyond. Limiting risks across RFCs (Reasons for Concern) would imply a limit for cumulative emissions of CO2. Such a limit would require that global net emissions of CO2 eventually decrease to zero and would constrain annual emissions over the next few decades (Figure SPM.10) (high confidence).

However, the term net-zero needs some sort of definition, although this is currently missing from the UNFCCC text. One online source offers the following;

Net phase out of GHG emissions means that anthropogenic emissions of greenhouse gases to the atmosphere decrease to a level equal to or smaller than anthropogenic removals of greenhouse gases from the atmosphere.

The above effectively means stabilization of the atmospheric concentration of CO2, which also aligns with the ultimate aim of the UNFCCC Convention (stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system). This could still leave room for some level of emissions in that climate models show atmospheric concentration of carbon dioxide will decline if anthropogenic emissions abruptly stopped. In a 450 – 500 ppm stabilization scenario emissions could remain in the range 7-10 billion tonnes CO2 per annum without driving the atmospheric concentration higher. This is far below current levels (35 billion tonnes per annum from the energy system alone), but it isn’t zero. It can be classified as net-zero though, in that the atmospheric concentration isn’t rising.

However, such an outcome, while stabilizing the atmospheric concentration may not be sufficient to prevent dangerous interference with the climate system. In that case an even lower level of emissions may be required, such that atmospheric concentrations do begin to fall and stabilize at a lower concentration.

Another definition of net-zero may simply apply to anthropogenic emissions directly, irrespective of what the concentration in the atmosphere might be doing. In this case, any remaining emissions from anthropogenic sources (and there will be some) would have to be offset with sequestration of carbon dioxide, either via CCS or a permanent forestry solution. In the CCS case, the carbon dioxide would need to come from a bio-source, such as the combustion of biomass in a power station. This is what the IPCC have termed BECCS.

A final step which goes beyond net-zero, is to have an anthropogenic net-negative emissions situation, which is drawing down on the level of carbon dioxide in the atmosphere through some anthropogenic process. This would be necessary to rapidly lower the concentration of carbon dioxide in the case of a significantly elevated level that comes about in the intervening years between now and the point at which the concentration stabilizes. Very large scale deployment of BECCS or an atmospheric capture solution with CCS would be required to achieve this.

Finally, there is the consideration that needs to be given to greenhouse gases other than carbon dioxide. Methane for example, while a potent greenhouse gas, is relatively short lived (a decade) in the atmosphere so will require some thought. Even in a zero energy emissions system, methane from agriculture and cattle will doubtless remain a problem.

Both of the Shell New Lens scenarios end in a net zero emissions outcome by the end of the century, but this is within the energy system itself and does not encompass the full range of other sources of CO2 emissions and other long lived greenhouse gases. Nevertheless, with extensive deployment of CCS the Mountains scenario heads into negative emissions territory by 2100 and the Oceans scenario soon after that (which means there is potential to offset remaining emissions from very difficult to manage sources). Oceans relies on this approach in a major way to even approach zero in the first instance

Many look to renewable energy as a quick solution to the emissions issue, but the reality is far more complex. While we can imagine a power generation system that is at near zero emissions, made up of nuclear, renewables and fossil fuels with CCS, this is far from a complete solution. Electricity currently represents only 20% of the global final energy mix (see below, click for a larger image: Source IEA).

Solutions will need to be found for a broad range of goods and services that give rise to greenhouse gas emissions, including non-energy sources such as limestone calcination for cement and cattle rearing for dairy and direct consumption. While we can also imagine a significant amount of global light transport migrating to electricity, shipping, heavy transport and aviation will not be so simple. Aviation in particular has no immediate solution other than through a biofuel route although there is some experimentation underway using high intensity solar to provide the energy for synthesis gas manufacture (from carbon dioxide and water), which is then converted to jet fuel via the well-established Fischer–Tropsch process. There are also dozens of industrial processes that rely on furnaces and high temperatures, typically powered by fuels such as natural gas. Metal smelting currently uses coal as the reducing agent, so a carbon based fuel is intrinsic to the process. Solutions will be required for all of these.

Whether we aim for a very low level of emissions, true net-zero anthropogenic emissions or negative emissions is somewhat academic today, given the current level of emissions. All the aforementioned outcomes are going to require a radical re-engineering of the energy system in a relatively short amount of time (< 80 years).