1. WBCSD, November 2004 Energy and climate change Facts and Trends to 2050

2. 2 The issue at a glance... Growth, development & energy demand Energy is the fuel for growth, an essential requirement for economic and social development. Energy demand could double or triple by 2050 as a result of development. Facts and trends Reshaping our energy future By 2050 energy demand will be sharply higher, but global carbon emissions must be no higher than today and trending downward. No single solution will deliver this change. Above all, we need to start now. The dynamics of technological change Global technological change is a lengthy process, measured in decades. Very large systems such as transport and energy infrastructures can take up to a century to fully develop. Energy use and climate impacts Carbon dioxide levels in our atmosphere are rising, as is global temperature. By starting to manage carbon dioxide emissions now, we can limit the change.

3. 3 The issue at a glance... Facts and trends - section 1 Growth, development & energy demand Energy is the fuel for growth, an essential requirement for economic and social development. Energy demand could double or triple by 2050 as a result of development. Reshaping our energy future By 2050 energy demand will be sharply higher, but global carbon emissions must be no higher than today and trending downward. No single solution will deliver this change. Above all, we need to start now. The dynamics of technological change Global technological change is a lengthy process, measured in decades. Very large systems such as transport and energy infrastructures can take up to a century to fully develop. Energy use and climate impacts Carbon dioxide levels in our atmosphere are rising, as is global temperature. By starting to manage carbon dioxide emissions now, we can limit the change.

4. 4 How will our energy system develop? Primary, Energy, EJ 200 0 400 600 800 1000 1200 1920-1930s Coal economy OECD countries Non-OECD countries Development of oil, gas and large-scale hydro, introduction of nuclear. 2000 New renewables such as wind and solar The transition is uncertain? 2050 Low High 0 2000 4000 6000 8000 CO 2 emissions -0.4 -0.2 0.0 0.2 0.4 Temperature variation Source: Hadley Centre and CDIAC Global CO 2 emissions from fossil fuel use, MtC Temperature variation (w.r.t. 1961-1990)

5. 5 Global Trend Growth, development and energy demand Basic premise – energy use and growth are strongly linked 0 50 100 150 200 250 300 350 400 $0$5'000$10'000$15'000$20'000$25'000$30'000 GDP per capita, US$ 1995 ppp Energy Use, GJ per capita EU-15 North America Korea 1970-2000 Malaysia 1970-2000 China 1970-2000 Source: WBCSD adaptation of IEA 2003

6. 6 Global population divided into income groups: Poorest (GDP < $1,500) Developing (GDP < $5,000) Emerging (GDP < $12,000) Developed (GDP > $12,000) Shifting the development profile to a low poverty world means energy needs double by 2050 Shifting the development profile further to a developed world means energy needs triple by 2050 0 2000 4000 6000 8000 10000 20002050 Low Poverty Base caseProsperous world Population, millions Population expected to rise to 9 billion by 2050, mainly in poorest and developing countries. Developed (GDP>$12,000) Emerging (GDP<$12,000) Developing (GDP<$5,000) Poorest (GDP<$1,500) Primary energy Growth, development and energy demand Source: WBCSD adaptation of IEA 2003

7. 7 Energy use, development and CO 2 Other sectors Non-road transport Road transport Manufacturing Energy industries Heat and power World USA Canada UK Germany Poland France Japan Australia OECD 20000 Indonesia Venezuela Brazil South Africa Nigeria Mozambique Russia China Pakistan India Non-OECD 5000 10000 Emissions by sector, kg CO 2 per capita per year (2001) Source: WBCSD adaptation of IEA 2003

8. 8 Energy use, development and CO 2 Power generation emissions gCO2/kWh 1000 800 600 400 200 0 Diversity of fuel sources South Africa (C) Brazil (H) Mozambique (H) India (C, H) Australia ( C, G) China (C, H) Poland (C, G) Pakistan (G, H) Netherlands (G, C) Venezuela (H, G) France (N, H) Iceland (H, Ge) USA (C, G, N) Germany (C, G, N) UK (G, N, C) Nigeria (O, G, H) Denmark (G, C, W) New Zealand (H, G, Ge) Indonesia (G, O, C, H) Japan ( G, N, C, H) Russia (G, C, H, N) Canada (H, C, G, N) Coal > Oil > Gas > Geothermal Nuclear Hydro Wind > Source: WBCSD adaptation of IEA 2003 and CIA 2004

9. 9 The issue at a glance... Growth, development & energy demand Energy is the fuel for growth, an essential requirement for economic and social development. Energy demand could double or triple by 2050 as a result of development. Facts and trends - section 2 Reshaping our energy future By 2050 energy demand will be sharply higher, but global carbon emissions must be no higher than today and trending downward. No single solution will deliver this change. Above all, we need to start now. The dynamics of technological change Global technological change is a lengthy process, measured in decades. Very large systems such as transport and energy infrastructures can take up to a century to fully develop. Energy use and climate impacts Carbon dioxide levels in our atmosphere are rising, as is global temperature. By starting to manage carbon dioxide emissions now, we can limit the change.

10. 10 Using the IPCC scenarios IPCC developed many scenarios, each with several models. A1B and B2 were consistent on population and development goals with Low Poverty and Prosperous World case. A1B-AIM and B2-AIM used in this publication. 1500 1000 500 Coal Oil Biomass Renewables Nuclear 20002050 Natural gas Primary energy, EJ per year A1B B2 Source: IPCC 2000 IPCC A1B, the higher energy use scenario, describes a future world of very rapid economic growth and the rapid introduction of new and more efficient technologies. RE IPCC B2, the lower energy use scenario, represents an intermediate level of economic growth with an emphasis on local solutions to sustainable development. In this world there is less rapid but more diverse technological change. RE

11. 11 Is there an acceptable limit for CO 2 emissions? Scenario A1B emissions range Scenario B2 emissions range Is there an acceptable limit for CO 2 emissions? 15 20 25 5 10 0 200020202040206020802100 1980 550 ppm Large-scale high-impact events Higher Very Low Risks to many Risks to some Unique and threatened systems Large Increase Increase Extreme climate events ºC 450 ppm 1000 ppm 2100 2300 1990 6 - 5 - 4 - 3 - 2 - 1 - 0 - 450 ppm 2100 2300 550 ppm 2100 2300 Source: IPCC 2001 CO 2, GtC

12. 12 Adapting to climate change The impact on our climate could be substantial even at an achievable stabilization level, so adaptation to climate change will have to play a part of any future strategy. Impacts will vary from region to region; much of the detail is uncertain. Measures might include: Flood defences in low-lying areas, ranging from Florida to Bangladesh Refugee planning for island states such as the Maldives Improved water management (e.g. aqueducts) as rainfall patterns change

13. 13 The issue at a glance... Growth, development & energy demand Energy is the fuel for growth, an essential requirement for economic and social development. Energy demand could double or triple by 2050 as a result of development. Facts and trends - section 3 Reshaping our energy future By 2050 energy demand will be sharply higher, but global carbon emissions must be no higher than today and trending downward. No single solution will deliver this change. Above all, we need to start now. The dynamics of technological change Global technological change is a lengthy process, measured in decades. Very large systems such as transport and energy infrastructures can take up to a century to fully develop. Energy use and climate impacts Carbon dioxide levels in our atmosphere are rising, as is global temperature. By starting to manage carbon dioxide emissions now, we can limit the change.

14. 14 All change tomorrow ? Many advocate that a rapid change in our energy infrastructure is the only solution to the threat of climate change. However: Major transitions at the global level will take time to implement The speed with which new technologies diffuse depends on many factors.

15. 15 Evolution of the Internet 1940195019601970198019902000 1943: I think there is a world market may be for six computers Thomas Watson, Chairman, IBM 1946: ENIAC unveiled 1964: IBM 360 1972: Xerox GUI and mouse 1982: IBM PC 2000: Cheap high speed computing 1991: www convention adopted 1990: Number of hosts exceeds 100000 1983: Switch-over to TCP/IP 1972: @ first used 1969: ARPANET commissioned by DoD for research into networking 1961: First paper on packet-switching theory Dot.com boom: explosive growth of the internet, acceptance as an everyday part of life

16. 16 The lifetime of energy infrastructure 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 ++ The rate of technological change is closely related to the lifetime of the relevant capital stock and equipment Motor vehicles 12 – 20 years Nuclear 30 – 60 years Coal power 45+ years Hydro 75+ years Gas turbines 25+ years Buildings 45+++ years

17. 17 « Technology transfer »? 1930194019501960197019801990200020102020 First prototype First concept 1 million produced 16 million produced Production at 1000 cars/month 1 million per annum produced 21.5 million produced Production ends in Germany Production ends in Mexico Last vehicles on the road in the EU Last vehicles on the road? New technologies in developed countries may arrive, mature and even decline before their widespread adoption in developing regions.

18. 18 Case 1: Light duty vehicles 0 500 1000 1500 2000 2500 200020102020203020402050 Total vehicles, millions Total alternative vehicles Total traditional vehicles Annual total vehicle growth of 2% p.a. Annual vehicle production growth of 2% p.a. Large scale "alternative" vehicle manufacture starts in 2010 with 200,000 units per annum and grows at 20% p.a. thereafter.

19. 19 Case 2: Power generation technologies 0 2000 4000 6000 8000 1999201020202030 Global installed generation capacity GW... because of the large existing base of power stations and their long lifetimes Additional capacity needed Declining current capacity CO 2 emissions Mt per year 10000 8000 9000 … CO 2 emissions from the power sector will still not start to decline before 2030 All new coal stations capture and store carbon or nuclear/ renewable capacity is built instead Natural gas is the principal other fossil fuel Even if…

20. 20 The issue at a glance... Growth, development & energy demand Energy is the fuel for growth, an essential requirement for economic and social development. Energy demand could double or triple by 2050 as a result of development. Facts and trends - section 4 Reshaping our energy future By 2050 energy demand will be sharply higher, but global carbon emissions must be no higher than today and trending downward. No single solution will deliver this change. Above all, we need to start now. The dynamics of technological change Global technological change is a lengthy process, measured in decades. Very large systems such as transport and energy infrastructures can take up to a century to fully develop. Energy use and climate impacts Carbon dioxide levels in our atmosphere are rising, as is global temperature. By starting to manage carbon dioxide emissions now, we can limit the change.

21. 21... about 1400 1GW CCGT power stations... about 700 conventional 1GW coal fired power stations... about 600 million SUVs... or more than one and a half billion hybrid- electric vehicles One Giga-tonne of carbon emissions per year?

22. 22 Todays energy infrastructure 700+ coal power stations1.5 Gt 25EJ per year solar 500,000 5MW wind turbines 1000 1GW coal power stations 1000 1GW coal stations with sequestration 1000 1GW oil power stations 1000 1GW gas power stations 1000 1GW nuclear plants 1000 1GW hydro/ tidal /geothermal 50EJ non- commercial fuel 100 EJ direct fuel use (Biofuels) 500 million vehicles (Biofuels) 500 million low CO 2 (Biofuels) 800 gas or oil power stations 0.7 Gt 800 million vehicles1+ Gt Non-commercial biomass 1 Gt Direct burning of fuel 3-4 Gt 8.0 Gt 8 Gt carbon 309 EJ 2000 Non emmitting technologies 0 Gt Final Energy Non-commercial Solids Liquids Electricity Gas

23. 23 2050 (B2-AIM) 2050 (A1B-AIM) Meeting future energy needs (IPCC) Final Energy Non-commercial Solids Liquids Electricity Gas 671 EJ 1002 EJ Intermediate growth, local solutions, less rapid technological change. Rapid economic growth and rapid introduction of new and more efficient technologies. 15 Gt carbon 16 Gt carbon

24. 24 Achieving an acceptable CO 2 stabilizationAchieving a lower CO 2 stabilization 0 5 10 15 20 25 30 200020202040206020802100 CO 2 emissions GtC / year A1B/B2 Emissions range 550 ppm 1000 ppm 6-7 Gt reduction A1B-AIM B2-AIM Source: IPCC 2000

25. 25 Low energy / carbon intensity development, enabled by societal and technology changes. 2050 (550 ppm trajectory) 705 EJ A much lower CO 2 trajectory 9 Gt carbon Final Energy Non-commercial Solids Liquids Electricity Gas

26. 26 Some options at a glance 2000 8 Gt 309 EJ 2050 (B2-AIM) 671 EJ Intermediate growth, local solutions, less rapid technological change. 15 Gt 1002 EJ Rapid economic growth and rapid introduction of new and more efficient technologies. 16 Gt 2050 (A1B-AIM) Low energy / carbon intensity development, enabled by societal and technology changes. 2050 (550 ppm trajectory) 705 EJ 9 Gt

27. 27 550 ppm 1000 ppm 0 5 10 15 20 200020202040206020802100 CO 2 emissions GtC / year Scenario B1 emissions range Source: IPCC 2000 Energy conservation and efficiency

28. 28 Options for change – enabling technologies A further shift to natural gas 1400 1 GW CCGT rather than 700 conventional coal fired plants means 1 Gt less carbon emissions per annum. Nuclear energy 700 1 GW plants rather than 700 conventional coal fired plants means 1 Gt less carbon emissions per annum. Renewables Wind, solar, geothermal, hydroelectricity. e.g. 300,000 5 MW wind turbines is equivalent to 1 Gt carbon from conventional coal, but would cover Portugal! Bio-products By 2050, bio-products could contribute 100 EJ of final energy with little or no net CO 2 emissions. Carbon capture and storage A possible route to using our abundant coal resources, but numerous implementation challenges remain. Mass transportation CO 2 emissions per person vary over a 3:1 range for developed countries – mass transit is one of the reasons. Road transport Could rise to 3 Gt carbon by 2050 with over 2 billion vehicles. Improved efficiency or a hydrogen economy could each reduce this by 1 Gt. Buildings The US DOE Zero Energy Home program has shown that a 90% reduction in energy can be achieved for new. buildings. Low energy appliances 0.5 – 1 Gt carbon reductions could be achieved by 2050 just by changing the lights!! Doing things differently Imagine what can be achieved with the internet and wireless technology! Emission reduction Energy conservation and efficiency

29. 29 Principal references and sources BP 2003: Statistical review of world energy Central Intelligence Agency 2004: The world factbook Evan Mills Ph.D., IAEEL and Lawrence Berkeley National Laboratory 2002: The $230-billion global lighting energy bill Hadley Centre and Carbon Dioxide Information Analysis Centre (CDIAC) IEA 2003: CO2 emissions from fuel combustion 1971-2001 IEA 2002: World Energy Outlook IPCC 2001: Climate change 2001, Synthesis report IPCC 2000: Emissions scenarios: A special report of working group III of the Intergovernmental Panel on Climate Change UN 2002: World population prospects WBCSD 2004: Mobility 2030: Meeting the challenges to Sustainability