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Net Zero 2050 and the Future of Coal in Asia and the Pacific

The Sixth Assessment Report of the United Nations International Panel on Climate Change recently presented key results of expert climate modelling with different emissions scenarios and their potential impacts on hydrological, terrestrial, ocean, and other systems. It is a sobering assessment that concludes that “global surface temperature will continue to increase until at least the mid-century under all emissions scenarios considered.“ It posits with high confidence a linear relationship between human CO2 emissions and global warming and that global warming will exceed 1.5 and 2 degrees centigrade “unless deep reductions in CO2 and other greenhouse gas emissions occur in the coming decades.” It confidently estimates that current CO2 concentrations have not been experienced for at least 2.8 million years.

The energy sector accounts for about 75% of global greenhouse gas emissions and profound shifts in the energy system will be needed to achieve net zero CO2 by 2050 and reductions in other GHG. At least 21 of the 34 members of the Organization of Economic Cooperation and Development (OECD), including the US and other G-7 members, have adopted net zero 2050 targets. In May, the IEA presented an urgent roadmap to achieve net zero by 2050 with the “immediate and massive development of all available clean and efficient energy technologies.”

A key feature of the IEA roadmap is the increasing electrification of all end-use sectors. In the main scenario, electricity rises to almost 50% of total energy consumption in 2050 compared to 19% in 2019. As energy demand decreases from today’s levels by 8% due to improved energy efficiency, electricity generation from clean sources, especially solar energy, increases by 2.5 times.

As we consider this scenario and the pathways to net zero, three key dimensions stand out: (1) the role of the emerging and developing (non-OECD) countries will increase in importance as demand and emissions fall in the OECD countries; (2) the Asia and the Pacific region dominates the global energy and emissions equation, with China and India the critical actors; (3) halting the development of new coal plants without CCUS, retiring older plants, and retrofitting existing coal plants, as the IEA report proposes, will be critical to the global emissions reduction effort, particularly in Asia and the Pacific. Let’s look at each of these points.

Growing Share of Non-OECD Countries: Growth in population, income, and urbanization levels in the non-OECD countries has led to steady increases in the non-OECD share of global primary energy consumption, even as energy demand in the OECD countries has stayed level or declined. Over the past twenty years, their share has increased from 42% in 2000 to 61% in 2020. With higher levels of fossil fuel consumption (86% compared to 77% in the OECD countries), energy-related CO2 emissions in the non-OECD accounted for 66% of the estimated global energy emissions in 2020.

Dominant Role of the Asia Pacific Region: The striking fact is that the Asia Pacific region is by far the largest energy consuming region of the world with 45% of primary energy consumption in 2020. With its heavy coal use, its estimated share in global energy-related CO2 emissions is 52%. Of course, China and India dominate the Asia-Pacific consumption, with 70% of the region’s consumption and together are still larger than any other region. They produced 37% of global energy-related CO2 emissions in 2020.

Halting Coal Plant Emissions: Net zero strategies must reduce emissions from the carbon-intensive coal sector, both in electricity generation and other uses of coal. Emissions from coal burning is the largest single source of CO2 emissions and IEA estimates that coal emissions in 2018 were 14.6 GT of CO2, of which 10.1GT was from electricity generation and 4.5GT was from other uses.) The IEA Climate Report for 2021 estimates the coal emissions will increase to 14.8GT in 2021, or 44.8% of expected total energy-related emissions in 2021 of 33GT. The Asia Pacific region is the leading coal consuming region accounting for 80% of total consumption. While OECD countries have reduced the role of coal and have in some cases pledged to phase out coal between 2030-2040, China and India have continued to increase their coal consumption and coal-fired electricity generation. Together they accounted for an estimated 64% of global coal-fired generation in 2020. BP statistics indicate that China alone accounted for 68% of the growth of global electricity generation over the 2010-2020 period. Despite the pandemic, China’s coal generation increased last year and accounted for 63% of its total generation. Although it has pledged to achieve net zero by 2060, China plans more coal plants in the future and its existing fleet is relatively young.

As the world looks to the November Glasgow Climate meeting, the importance of the emerging and developing countries, especially those in the Asia-Pacific region, is evident. Regardless of the fact that many of these countries have low per capita energy consumption, decisive commitments and actions by these countries to stop coal development and substitute cleaner fuels is essential. Net zero strategies, especially those that call for increasing electrification, are just not going to be successful without cleaner sources of electricity and the reduction of coal use in the Asia Pacific power sector.

Further blogs will delve into the situation in individual countries of the Asia Pacific region.

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