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Amid Danger Signs, A Global Energy Leader Finds Reason for Hope

For more than a decade, Fatih Birol has consistently warned that the world is moving far too slowly to wean itself off fossil fuels. Two weeks ago, the International Energy Agency (IEA) added its latest admonition: Global CO2 emissions this year are expected to experience their second-largest increase on record.

Last week, Birol spoke to President Biden’s climate summit and, after listening to world leaders once again vow to slash emissions, the IEA’s executive director said, “Right now the data does not match the rhetoric — and the gap is getting wider.”

Fatih Birol
IEA

In an interview with Yale Environment 360, Birol leavened his concern over still-rising CO2 emissions with a note of optimism. He talked about the need to begin phasing out coal in three key Asian countries (China, India, and Indonesia) and slashing methane emissions in the U.S., discussed the essential role the Biden administration must play in the climate fight, and explained why policymakers must send an “unmistakable signal” to businesses that investments in clean-energy technologies — not fossil fuels — will be the winners.

“[Decarbonization] is not only a drive to help the world to be a better place, but also to prepare the national economies of the future,” Birol said. “I can tell you, based on the discussions I have with different world leaders, governments, businesses, citizens, civil society, I have a great hope that this will be a glorious chapter of human history.”

Yale Environment 360: When we spoke in 2012, you delivered a message that was very similar to the one you delivered at President Biden’s climate summit last week, which is that for all the rhetoric and talk of pledges, emissions are continuing to soar at an alarming rate. That was nearly a decade ago and here we are again in the same situation. How do we begin to reverse this?

Fatih Birol: To be honest with you, the climate summit was an historical one, and I left it with mixed feelings. On the one hand it was great to see so many world leaders making commitments on behalf of their governments to meet net-zero targets or to reduce their emissions. This was excellent. But at the same time, only two days before the summit, we published our emissions numbers that global emissions were to increase this year by 1.5 gigatons [billion tons], which is the second-largest increase in history. So on the one hand we see a rather positive development in some advanced economies — not positive enough but still positive — and in the emerging world, which is developing and which needs a lot of energy, we still see emissions are growing stronger.

So the job for the world is how do we pave the way for the developing countries to continue to grow, but at the same time reduce their emissions, while advanced economies reduce their emissions further in a much more ambitious way. The hope is we all move together, and if we cannot move all together, if there’s no intelligent collaboration among countries, our chances to reach the [climate] goals will be close to zero.

e360: When you spoke at last week’s summit, you said we need real changes in the real world, but you know the world turns, and China’s economy is projected to have double-digit growth in the coming years, and with the U.S. economy we’re talking 6 to 7 percent growth. What are some of the real changes — in terms of both government policy, investment policies, and private sector involvement — that can begin to reverse this continuing upward trend?

Birol: We need two big changes to happen. One, from the technologies which are available today in the market, we have to use them at the maximum level. What are those technologies? Solar, wind, energy efficiency, electric cars — we have to use them at the maximum. This is one. But this alone is not enough. To reach our climate targets in 2050, 50 percent of the emissions reductions need to come from technologies which are not in the market today, such as hydrogen, battery storage, carbon capture-and-storage, and others.

So we have two different jobs to do. Now, in both cases — even though I am a person who thinks that market instruments are the best way to govern the energy sector — I believe given the magnitude of the challenge and the time left for us, governments need to be in the driver’s seat. Of course, this doesn’t mean that all the financing needs to come from governments. The governments provide part of the financing but give the unmistakable signal to investors that if you invest in the old, outmoded technologies, you are going to lose money, because of the regulations, and the investment policies they [governments] are going to take. And at the same time, governments should give a signal to investors that if you go for the clean-energy technologies, technologies of the future, we are going to incentivize those projects.

If we succeed in reaching our current goals, this should be a success story driven by governments, and if we fail, I think this will be the responsibility of governments. Governments play a key role here.

The clean-energy momentum will be taking place in many countries…. it will be unstoppable.

e360: Based on what you’re saying, I would think you must be encouraged so far by the actions of the Biden administration?

Birol: Definitely so. I believe the leadership of the United States is extremely important and that way we can provide unprecedented international momentum to addressing climate change. And after last week, I heard [from government ministers] that a new chapter was started. What I liked very much was that the United States administration was represented not only by the president and the energy and climate secretaries, but also across the government. We have seen there the secretary of commerce, the secretary of state, the secretary of transportation — across the government, and it set a very good example. And I hope this leadership will continue to be proven to reach the climate goals the U.S. set for itself, but also in providing international leadership in terms of helping other governments to reach their targets.

e360: How concerned are you and the various ministers you speak with that in another four years we could have a Republican administration that completely reverses what Biden is doing, just as Trump completely reversed what Obama did?

Birol: I can tell you that the clean-energy momentum will be taking place in many countries — even though government administrations will change, it will be unstoppable. And I believe some of the countries will put money and legislation to push clean-energy technologies, not only to reduce emissions but also for competitiveness and for building their economies for the future. This is not only a drive to help the world to be a better place, but also to prepare the national economies of the future. I think these are two important drivers, and therefore if governments come and go, which will be the case in many countries, it will not have a major effect, because I think these changes are unstoppable.

e360: The IEA mentioned in its latest report that the growth of coal is obviously a concern, and China continues to build coal-fired power plants, but also in places like the United States there is a very heavy reliance on natural gas. Concretely, what can be done in China with coal and in the U.S. with natural gas to make significant reductions in the use of these fossil fuels in the next decade or two?

Birol: All fossil fuels contribute to emissions, but if I am to focus on something, it is coal in Asia — in China but also India and Indonesia. These three countries make almost 45 percent of the global population, and more than 60 percent of their electricity comes from coal. And the issue is the following: In the U.S., you also have coal plants, in Europe we also have coal plants. But the average age of coal plants in Europe or the United States is about 40 years old. They are very close to retirement — a coal plant has a lifetime of 45 years or so. But in Asia, they are 11 years old, they are far from retirement, and how do we achieve early retirement in those countries, how to convince them before the investment is paid back in many cases? This is for me by far the most important issue.

With natural gas, we have to find ways to use natural gas in a low-carbon way, in terms of hydrogen, and biomethane, and the others. But most importantly in my view, an immediate task in the United States is the reduction of methane emissions. In the U.S. and elsewhere, methane emissions are very, very strong. Unfortunately, some of the [methane] regulations have been lifted in the last few years in the United States. And we need to put strict emissions regulations in the United States and elsewhere to reduce methane emissions.

Global GDP, total primary energy demand, and energy-related CO2 emissions from 2019 to 2021.

Global GDP, total primary energy demand, and energy-related CO2 emissions from 2019 to 2021.
IEA

e360: Are you saying that you think some sort of international financial help will be needed to stimulate China, India, and Indonesia to end the use of these coal-fired power plants before their natural life expires?

Birol: In some cases, there may be a need for international incentives for [some of] those countries. But many of the biggest emitters do have the ability to address these problems with their own means. It is good for them to prepare their economies for the future.

e360: In terms of renewables, you pointed out at the recent climate summit that there is encouraging news. You’re projecting wind and solar to grow by 17 or 18 percent this year, yet still CO2 emissions keep going up. What is needed to get wind and solar to the point where you actually start to see national and global emissions coming down?

Birol: Solar is growing very, very strongly around the world, and the IEA recently crowned solar as the new king of the global power markets, overtaking coal, because as you know, it was called king coal. That is over, it is passé. Now it is solar coming on very strongly. Market dynamics are going in the right direction, but still the pace needs to be accelerated by government support.

Renewables today are mainly used in electricity generation, and we are not talking about the clean-electricity transition, we are talking about the clean-energy transition. How are we going to decarbonize the iron and steel sectors? How are we going to decarbonize aviation? So renewables today are not enough. We need as much as possible renewables, but beyond that, we need other clean-energy technologies ranging from hydrogen to carbon capture to nuclear power to energy efficiency. We need all clean-energy technologies.

The energy sector is like a big tanker, so when you change direction it goes really slowly.

e360: What are the general components of your upcoming road map, both in terms of bringing down emissions rapidly in the next decade or two and then getting to net-zero emissions by 2050?

Birol: The key components are very simple. The energy sector is like a big tanker, so when you change direction it goes really slowly. It is not like a bicycle — a bicycle is very different, as we see in the IT sector, which moves very quickly. The challenge is a Herculean challenge. So we came up in our report with what needs to happen, first of all, between now and 2030. This is the first thing, and the second is how do we prepare the world after 2030 to reduce emissions, and what kind of new technologies do we need, and what kind of existing technologies do we need to stop and when do we stop them? We look at this and we look at the implications of those on employment, the economy, and energy-producing countries.

e360: When the history of this struggle to slow climate change is written in 100 or 200 years, and people look back on the era we’re in now, how do you think this chapter will be written? Will this be seen as a lull before huge progress in reducing emissions, or will this be viewed as such a Herculean challenge that the world just couldn’t make the transition fast enough and we were looking at really severe climate change?

Birol: I can tell you, based on the discussions I have with different world leaders, governments, businesses, citizens, civil society, I have a great hope that this will be a glorious chapter of human history. I believe that the technology and the political determination will write a glorious chapter of human history and this will be a leap forward.

e360: Glorious in both meeting the climate challenge and economically?

Birol: Economically preparing the world for a much better world, a more sustainable world, and also saving us from a big catastrophe. Future generations may not understand it because we will have avoided catastrophe. But people like yourself and myself, we knew what kind of challenge it was, and thanks to leaders around the world, known and unknown heroes, I think this will be a glorious chapter of human history.

e360: I hope you’re right.

Birol: I hope so, too.

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