The impacts of climate change, such as floods and droughts, and its subsequent policy responses, will pose significant challenges to an energy sector that must also rapidly decarbonise, a new report has warned.
The briefing, published by the World Energy Council (WEC), Cambridge University and the European Climate Foundation says that the energy industry is both a major contributor to climate change and a sector that climate change will disrupt.
Consequently, it calls for climate change mitigation and adaptation measures to be incorporated into all energy policymaking, infrastructure planning and investment decisions.
The report builds on the latest report from the Intergovernmental Panel on Climate Change (IPCC), which said trillion-dollar shifts in investment from fossil fuel energy sources to renewables were urgently needed if irreversible climate tipping points are to be avoided.
Without such efforts, scientists estimate that global temperatures may increase by as much as 3.7C to 4.8C by the end of the century, far exceeding the agreed 2C threshold.
The new report, officially released on Wednesday at the Asian Clean Energy Forum in Manila, notes that demand for energy will inevitably increase as populations rise and economies grow.
This presents a significant challenge, as the share of low-carbon electricity generation will need to triple or quadruple by 2050 and meet almost all energy demand by 2100.
To do this, the industry must scale up renewables and nuclear energy, switch to lower-carbon fuels, improve energy efficiency, reduce energy demand and introduce carbon capture and storage technology, the report says.
While this would hit the profits of coal and oil giants, it also presents significant opportunities for sustainable investments.
“The energy sector has a critical role to play in the mitigation of greenhouse gases and in helping the world to adapt to the inevitable impact brought by climate change”, said Rajendra Pachauri, chairman of the IPCC, while praising the report.
Philippe Joubert, advisory board member for the Cambridge Institute for Sustainability Leadership and chair of the WEC’s Global Electricity Initiative, added, “Leading businesses in this sector increasingly realise that business as usual is no longer possible nor acceptable.”
At the same time, the briefing warns that significant investment must be made to ensure energy infrastructure is resilient to new climate risks.
Electricity distribution networks are exposed to storms and extreme weather events, while most large power plants lack protection against floods and are vulnerable to droughts, as they require water for cooling.
“Leadership will be required at all levels”, said Christoph Frei, secretary general of the WEC.
“As we look to create resilient energy systems that meet the triple challenge of the energy trilemma the time has come to get real about the challenges facing the energy sector.
“There is no climate framework without national energy policy.”
Photo: thewritingzone via Flickr