The Power Is in the Data - reports reveal the status of global clean-energy transition

Melissa C. Lott

As any analyst will tell you, the power is in the data. To know where we are going, we first must know where we are. But, setting global energy baselines is anything but easy.

Today, at the Clean Energy Ministerial meeting in New Delhi, the International Energy Agency released two reports – “Tracking Clean Energy Progress 2013” and the “Global EV Outlook.” The latter includes landmark trending data for the global electric vehicle (EV) market, which was then used to determine the overall trajectory of a global clean-energy transition.

The Highlights

According to these two reports, despite significant gains in renewable power generation, coal technologies still dominate and nuclear power continues to struggle. But, a window of opportunity is opening in the transportation sector.

The tracking report reveals analysis shows that the world is not moving quickly enough to meet environmental targets. Key technologies are not being developed. Global research and development investments need to be dramatically increased. The clean-energy transition appears to have stalled.

The world is sitting on a sustainability precipice and, in the words of IEA Executive Director Maria van der Hoeven, “we must change course before it is too late."

Eleven Progress Areas – Two On Track

In this IEA “Tracking Clean Energy Progress 2013” report, the authors outline a set of eleven progress areas that their analysis has identified as being essential in moving the globe through a cost-effective clean-energy transition. These areas are:

• Renewable power
• Nuclear power
• Gas-fired power
• Coal-fired power
• Carbon Capture and Storage (CCS)
• Industry
• Fuel Economy
• Electric and hybrid-electric vehicles
• Biofuels
• Buildings
• Smart grids

Of these eleven interrelated areas, just two – renewable power and electric and hybrid-electric vehicles (EV and HEVs) - are on track according to IEA metrics. The other nine are all behind with gas-fired power, industry, fuel economy, and smart grids showing limited improvement. Progress for the remaining five (nuclear power, coal-fired power, CCS, biofuels, and buildings) hardly registered in 2012.

Defining Clean-Energy “Progress”

“Progress” is discussed in this IEA report in context with the 2°C Scenario (2DS), as presented in the IEA’s “Energy Technology Perspectives” (ETP) publication. The 2DS looks at the most cost-effective way to cut energy-related CO2 emissions in half by 2050 (compared to a 2009 baseline). This level of emissions reduction is broadly consistent with the “450” scenario that climate scientists argue “would give an 80% chance of limiting average global temperature increase by 2°C.”

For reference, the world today is estimated to be on track toward an average global temperature increase of 6°C by 2050. This scenario is shown at the top line in the chart below. This 6DS represents a doubling of energy-related emissions between 2012 and 2050.

ETP publications include the results of least-cost scenario analysis for a global clean-energy transition to meet the 2DS environmental constraints. Modeling was completed using MARKAL-TIMES and a series of independent Excel-based demand models for industry, buildings, and transportation.

With this modeling approach, the least-cost pathway for a 2DS was shown to include contributions from all sectors and a wide variety of technologies. This lease cost pathway is what led to the set of eleven areas that the IEA uses in measuring global clean-energy progress.

Nine Progress Areas Are Struggling

Out of the eleven progress areas defined in the IEA’s 2DS, nine are not on track to meet 2020 targets. These technologies struggle with a host of challenges including high capital investment requirements and a lack of supporting policies.

Nuclear power, for example, costs relatively little to operate. But, these power plants require significant upfront investment. Most world markets are not structured to reduce investment risks and so plants don’t get built. Further, the Fukushima incident in March 2013 shook public confidence.

Coal power continues to dominate in the electricity generation space. Without pricing and climate change policies it is unlikely that this trend will change. Further, the lack of government commitment to emissions reductions is preventing carbon capture and sequestration (CCS) demonstration projects from getting off the ground.

But, perhaps the most frustrating to energy analysts is the off-track progress area of energy efficiency in buildings. Only three countries in the world have best-practice building codes. As a result, new construction is still dominated by less energy-efficient designs.

Transport – “A Window of Opportunity”

According to the IEA, transport is one of only two progress areas on track to meet 2DS targets. According to their tracking report, while biofuels production was static in 2012, advanced biofuels capacity grew by about 30%. Further, electric and hybrid-electric vehicles realized significant gains.

Hybrid-electric vehicle (HEV) sales reached 1.2 million (43% growth rate) in 2012, with Japan and the US representing 91% of global sales. EV sales more than doubled in 2012, with more than 100,000 in total sales. In order to meet 2DS target deployment rates, HEV and EV sales need to average 50% and 80% annual growth rates, respectively.

This is the first time that these global data for EV sales have been published. Today, in conjunction with the New Delhi meetings, the first “Global EV Outlook” report was also released. Included are the results of two years of primary data gathering and analysis by the Clean Energy Ministerial’s Electric Vehicles Initiative (EVI).

This initiative’s membership includes 15 governments and the IEA, with 8 of the 10 largest auto markets represented. The data that EVI has collected gives a baseline for measuring progress in this area. And, simultaneously, it demonstrates the importance of data access to measuring progress in global clean-energy efforts.

Data presented today in the “Global EV Outlook” (GEO) illustrated a rapidly growing EV market that is on track to reach 20 million EVs on the road by 2020. But, it also cautions that there is still a long way to go, with current market shares for EVs still sitting below 1% in major markets. Regardless, current sales are on track to meet or exceed the IEA’s 2DS scenario goals.

Renewable Power Going Strong

In order to meet the energy-related emissions goals, the IEA’s 2°C Scenario shows renewable power generation growing from 20% to 57% of total generation between 2010 and 2050. Hydropower is the largest contributor, followed by wind, biomass, waste, and solar technologies. This scenario also shows renewables growing to 28% of total generation by 2020. And, these technologies appear to be on track to hit this midterm goal.

According to the IEA, renewables have shows steady market growth over the last decade. Renewable deployment is continuing to spread geographically, with countries including China, India, and Brazil increasing their use of renewables from 45% of total generation in 2010 to 53% in 2011.

Solar PV has seen “explosive growth” over the past year, almost doubling its total generation from 2010 to 2011. Further, new capacity installations continued, despite incentive cuts in markets including Germany and Italy. In fact, deployment seems to be spreading into Africa, Asia, Latin America, and the Middle East.

Other renewables including onshore and offshore wind, geothermal, biomass, biogas, and renewable municipal waste are on track to hitting 2DS 2020 targets. But, ocean power still remains a small contributor due to costly technology.

The Power is in the Data

One of the key findings in the IEA’s Clean Energy Tracking report was that poor quality and availability of data consistently constrains their ability to track and assess progress. For example, the smart grids category has seen significant movement over the last few years. According to the IEA, demonstration and deployment of smart grid technologies are accelerating. But, data collection efforts on national and international levels are too limited to give a solid picture of the progress made.

The premier of the “Global EV Outlook” (GEO) at this year’s CEM meeting is one example of IEA’s facilitation of better data collection. Last year, its predecessor – the EV City Casebook – established a baseline for the global EV market. This year’s publication presents the results of two years of primary data gathering and analysis from 8 of the 10 largest auto markets in the world.

Put another way – this is the first time that global data on EV market growth has been published since the Clean Energy Ministerial was established. As IEA continues its work, improved collection of and access to data will be an important factor in measuring 1) how far the clean-energy transition has come and 2) how much further it has to go.