The good news: it is possible to cut carbon emissions enough to keep a lid on global warming. The bad news: economic and energy sector realities

The technology to cut greenhouse gas emissions from energy generation to a level that limits global temperature rises to 2C above pre-industrial levels already exists, according to the International Energy Agency.

Yet nine out of 10 technologies that hold potential for energy and CO₂ savings are failing to meet the deployment objectives required to secure the transition to a low-carbon future.

These were among the main conclusions of Energy Technology Perspectives 2012, the IEA’s biennial presentation of energy scenarios and strategies that will limit global temperature rises to 2C.

Of particular interest is the report’s analysis of the role natural gas can play in delivering the 2C scenario. It concludes that while natural gas use may rise initially, displacing coal for base-load energy, beyond 2030 gas will complement renewable energy serving to “balance power generation and manage fluctuations”. The findings may prove uncomfortable reading for proponents of natural gas.

“Shell believes that natural gas is not just a ‘transition’ fuel; it’s a ‘destination’ fuel and is an important component of a sustainable global energy mix,” says David Hone, Shell’s senior climate change adviser.

“Displacing coal-fired power with natural gas is the fastest and cheapest route to CO₂ emissions reductions in the global power sector over the next 20-plus years,” Hone says. Shell has been investing accordingly. According to Hone, the company will in 2012 produce more natural gas than it does oil, for the first time.

Such a perspective sits uneasily with the IEA’s findings. The report questions the viability of some current gas infrastructure investments. Locking in fossil fuel infrastructure now may prevent adaptation to low-carbon technologies in the future.

The report comes at a difficult time for the natural gas industry, particularly in Europe and in light of larger public concerns around the practice of shale gas fracking. Both France and Bulgaria have banned shale gas fracking, while operations in the UK were recently halted – later given the green light – following a government investigation into earthquakes near drilling sites.

Business as usual

“The nuclear and gas industries, and many of the big energy companies are more interested in doing things as they’ve always done – which has proved highly profitable,” says Paul Steedman, senior campaigner at Friends of the Earth UK. 

Where Shell, environmental pressure groups and the IEA may be in closer alignment is around the importance of carbon capture and storage (CCS). Under the 2C scenario the IEA believes CCS could be responsible for up to 20% of global cumulative CO₂ reductions by 2050.

According to the Global CCS Institute, there are only 14 integrated large-scale CCS demonstration projects operating, or under construction, globally. In the UK, Shell, in partnership with SSE, is the only company currently committed to a large scale CCS demonstration project.

For the IEA this lack of progress is “particularly worrisome”. The report blames inadequate government funding, highlighting a steady decline in public support for energy-related public research, development and demonstration since the 1980s.