Monday, June 25, 2018

Energy Efficiency and Technology Squeeze the Carbon Bubble

A homeowner installing a programable thermostat a part of an Energy Department program that assists homeowners weatherize their homes. (Image Credit: U.S. National Renewable Energy Lab/Dennis Schroeder, public domain) Click to Enlarge.
The carbon bubble will burst with or without government action, according to a new study.  That will hurt people who invest in fossil fuels.

As energy efficiency and renewable energy technologies improve and prices drop, global demand for fossil fuels will decline, “stranding” new fossil fuel ventures — likely before 2035, according to the study in Nature Climate Change, Macroeconomic impact of stranded fossil fuel assets.

Researchers from Cambridge University and elsewhere found technological advances will strand fossil fuel assets regardless of “whether or not new climate policies are adopted,” but that “the loss would be amplified if new climate policies to reach the 2°C target of the Paris Agreement are adopted and/or if low-cost producers (some OPEC countries) maintain their level of production (‘sell out’) despite declining demand.”

That could “amount to a discounted global wealth loss of US$1–4 trillion,” and Russia, the U.S., and Canada could see their fossil fuel industries nearly shut down, the report says.

The best way to limit these negative impacts is to divest from fossil fuels and speed up the transition to a diversified, energy-efficient, clean-energy economy.  Investing tax dollars to expand fossil fuel development and infrastructure, including pipelines, is irresponsible and incompatible with Canada’s Paris Agreement commitments, putting everyone at economic risk, and leaving us with polluted air, water and land, and increasing climate impacts and healthcare bills.
Researchers found that while the shift from fossil fuels to conservation and clean energy is moving quickly enough to strand fossil fuel assets, it’s not happening fast enough to keep global average temperature from rising more than 2°C [3.6°F] above pre-industrial levels.  That will require concerted action from governments worldwide to meet and exceed Paris Agreement commitments.

One often overlooked factor is efficiency.  A study in Nature Energy found energy efficiency improvements could limit global warming to 1.5°C [2.7°F] above pre-industrial levels — the aspirational Paris Agreement target.  Many experts have suggested limiting warming to that degree would require large-scale bioenergy deployment (burning forest and plant products for energy) and negative emissions technologies (removing CO2 from the air and storing it on land, underground, or in the oceans).  But many of those technologies haven’t been tested on a commercial scale, and burning biomass creates pollution and affects land use, habitat, and food production — and the new report says warming could be limited without them.

Read more at Energy Efficiency and Technology Squeeze the Carbon Bubble

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