Perhaps inspired by clear messages from the
world’s scientific community, 2014 brought the sight of politicians
across the globe speaking of the need to transition away from
fossil fuels, and acknowledging the scale of that
Here are the trends that defined the global
climate and energy debate over the past 12 months.
Renewables records keep breaking, and need to continue
to do so
Renewable power records were shattered all over the world this
year. But the vast majority of human society remains
fossil-fuelled, and nothing seems to be changing that rapidly.
In December, the equivalent of 43 per cent of the UK’s homes
were powered by wind turbines, a
new record. Germany’s renewables produced 31 per cent of the
country’s power in the first sixth months of 2014,
a new record. At the same time, Denmark’s wind turbines
provided for 41 per cent of the country’s electricity consumption,
a new record. In Asia-Pacific, solar panels are projected to
account for 19 per cent more demand in 2014 than last year, a new
You get the idea.
The International Energy Agency says the
twin drivers of growing electricity demand and an ever-growing
renewables industry means low carbon power generation records are
continue to tumble for some time.
Power generated by renewables in the UK. Source:
BP Statistical Review of World Energy 2014. Graph by Carbon
The question isn’t whether renewables will keep growing. Rather,
policymakers need to ask whether they’ll grow quickly enough to
limit global warming. The Intergovernmental Panel on Climate Change
(IPCC) says the world’s energy system need to be zero
emissions by 2100 if policymakers are going to prevent warming
of more than two degrees above pre-industrial levels.
renewables’ relatively minor contribution to the world’s energy
mix – about five per cent at the end of last year – generation
records will need to keep being obliterated, and fast.
Carbon bubble message goes mainstream, but coal power
2014 was the year the carbon bubble concept – that companies
could be sitting on fossil fuel assets they can’t burn if the world
tackles climate change – went mainstream.
At the start of December, the Bank of England announced it would
launch an enquiry into the financial risks companies were
taking as the world tries to agree ways to cut emissions. Six
months earlier, the IEA warned that companies’
assets could become ‘stranded’ if politicians chose to tackle
The Carbon Tracker Initiative thinktank first floated the idea
of a carbon bubble back in
2012. Since then, climate campaigners have been pressuring
investors to pull their backing for energy companies on the
basis that most of the world’s fossil fuels will need to stay in
But 2014 was the first time such weighty institutions backed the
concept. Perhaps the IPCC’s decision to
include a carbon budget in its landmark report at the end of
2013, which showed the world could emit enough carbon dioxide to
push global warming above two degrees
within the next two decades, jolted their imaginations.
Graphic by Carbon Brief. Click for full
Despite such backing, fossil fuel companies remained bullish. In
May, Shell wrote a 30-page letter to its investors explaining
exactly why it was unconcerned about the carbon bubble. In
July, we asked 76 oil, gas and coal companies for
their take on the carbon bubble research. 58 companies didn’t
respond, and we got no response from the coal industry.
The world’s most polluting fossil fuel, coal, certainly doesn’t
seem to be going away any time soon. The IEA expects global demand
to grow over the next five years, breaking nine billion tonnes
Coal demand is expected to stay strong
across the world. India is expected to
double its coal consumption by 2035. Despite China’s pledge for
its emissions to
peak by 2030, coal is expected to continue to be its main
fuel source well until at least 2035. Likewise, the Energy
Information Administration expects about 40 per cent of the US’s
power in 2035, despite the
President’s much lauded plans to curb coal power
The only region bucking that trend is Europe. The European
Commission expects the region’s energy
consumption from coal to halve by 2050. But that would still
mean eight per cent of the EU’s demand is met by coal. If there is
a carbon bubble, it doesn’t look like it’s going to burst just
We know we need energy efficiency, now we need to do
Efficiency improvements have the potential to save huge amounts
of energy, and appear to be
starting to curb demand in some parts of the world. But over
the past 12 months, experts have repeatedly called on policymakers
to step up efforts to cut energy demand.
In July, Russia’s annexation of the Crimea focused bureaucrats’
minds as they sought to set a new energy efficiency target for the
region. If the EU could use less energy, it would be in a better
position to negotiate with Russia over its gas supply, they
figured. In the end, they settled on the aim of
cutting the region’s energy use 30 per cent by 2030.
In November, the United Nations Environment Programme (UNEP)
report showing energy efficiency could be responsible for
up to a fifth of the cuts countries need to make to stick to
the IPCC’s carbon budget. Energy efficiency improvements could
prevent 22 to 24 gigatonnes of carbon dioxide emissions between
2015 and 2030, UNEP estimates, with new energy efficiency policies
reducing energy demand by about five to seven per cent.
Energy security and cutting emissions aren’t the only reasons to
invest in energy efficiency,
the IEA said in September, it can also boost GDP, create jobs
and improve trade balances by reducing costly imports of fossil
fuels. If that’s the case, then it’s perhaps fair to ask,
why aren’t we doing more of it?
The answer could be that some countries simply aren’t that good
at incentivising people to make such long term investments.
Britain’s schemes continue to struggle, with the UK
falling from first to sixth on a list of energy efficiency
leaders in July.
Energy use in the UK’s homes. Electricity on the left axis,
gas on the right axis. Data from the
Department of Energy and Climate Change. Graph by Carbon
Labour has promised to fix the schemes if it gets into
government next May, though
it’s not clear where it’ll get the money from to do so. Maybe
the UK could
learn some lessons from France and, in particular, Germany.
Both countries have implemented considerably more successful
schemes to get people to insulate their homes and upgrade
But it would be fair to say that 2014 saw policymakers commit to
the idea that switching to low carbon energy generation won’t be
enough on its own – countries also need to do much more to cut
The implications of a low oil price for climate change
are far from clear, yet
The biggest energy story of the second half of 2014 has been the
plummeting oil price. But it’s still too early to really assess
what it might mean for the global energy sector and greenhouse gas
The oil price fell from $115 dollars a barrel in June to
under $70 this month. Relatively sluggish demand due to the
economic recession, increased US production, and Saudi Arabia’s
desire to see Russia and Iran suffer are all partially responsible
for the price drop.
Oil price in 2014. Source: MoneyWeek
There are two conflicting schools of thought on whether or not
this is a positive thing for countries’ efforts to cut
The first argues that low prices mean people use more oil,
particularly in the
transport and agriculture sectors. It also potentially means
countries that are large exporters of oil,
such as Mexico, have less money, and so spend less on
renewables. Both are those are bad news for emissions.
The alternative argument is that a low oil price presents some
opportunities to boost low carbon energy in the long term. If oil
is cheap, energy companies can’t afford to undertake risky
extraction projects such as those planned in
certain tar sands or the Arctic. It could also give countries
an opportunity to
cut fossil fuel subsidies and implement carbon taxes,
encouraging more efficient, low carbon, energy use, the IEA
The oil price’s volatility could also serve as a reminder of an
advantage of switching to low carbon fuel sources: their
lack of sensitivity to the international fuel markets’ swings.
But switching to low carbon energy sources is easier said than
done. The New Yorker
argues, that cheap fossil fuels have become “like an industrial
form of crack. It doesn’t really matter how much damage it causes,
because we simply don’t have the power to walk away.”
Powering through 2015
In 2014 a plethora of reports contributed to identifying how the
world’s energy supply needs to change if countries are going to cut
emissions and tackle climate change over the past year. Such
information is going to be invaluable as negotiators head towards
their self-imposed deadline to agree a new global climate deal by
the end of next year.
With that in mind, we leave you with this image – the energy
sector certainly has some changing to do next year, and for many
years after that, if the world is going to prevent temperatures
rising by more than two degrees:
Source: Data from the International
Energy Agency. Graphic by Carbon Brief.