(Reuters) – A stark appeal by the world’s top energy body to stop investment in new fossil fuel projects by next year has met a mixed reception from the world’s top producers – from guarded praise and pledges to cut back on coal to outright defiance.
The International Energy Agency said in its “Net Zero by 2050” report last week that investors should not fund new oil, gas and coal supply projects beyond this year if the world wants to reach net zero emissions by mid-century and meet the goals of the 2015 Paris Agreement on climate change.
Its findings aim to encourage ambitious climate targets from countries attending the United Nations’ Climate Change Conference (COP26) in November in Glasgow, Scotland but has yet to garner a full commitment from any country.
The world’s seven largest advanced economies agreed on Friday to stop international financing of coal projects that emit carbon by the end of this year and phase out such support for all fossil fuels. The United States, Britain, Canada, France, Germany, Italy and Japan, plus the European Union, said in a joint statement: “international investments in unabated coal must stop now”. Alok Sharma, the UK minister presiding over the global climate talks in Scotland who requested the IEA publish its Net Zero report, stopped short of committing to the fossil fuel ban.
“I welcome this @IEA report, which sets a roadmap to #NetZero and shares many of the priorities of the UK”, Sharma tweeted, adding that the UK wanted to “consign coal power to history”.
The UK government reached a deal with North Sea industry players in March to allow new offshore oil licensing rounds in exchange for pledges to cut emissions.
Following the G7’s communique on climate, Sharma said: “We are acting abroad as we’re doing at home by agreeing to phase out international fossil fuel finance, starting with coal”.
Norwegian Prime Minister Erna Solberg described the IEA’s roadmap as simply one of “many reports”, telling the NTB news agency it would not change the petroleum policy of Western Europe’s biggest oil producing country.
Norway has offered tax breaks as an incentive for new higher-cost oil projects and is preparing new licenses for offshore exploration.
“If this roadmap becomes a reality … it may in the long run affect the companies’ interest in looking for new discoveries”, Norwegian Oil and Energy Minister Tina Bru told Reuters.
White House National Climate Advisor Gina McCarthy said the IEA advice deserved close scrutiny but that change would be gradual and fossil fuel projects remained in the pipeline.
“I think that’s one of the things that we have to think about and struggle with … I’m not suggesting this transformation is going to be quick”, she said, noting that hundreds of new U.S. natural gas units were planned.
U.S. climate envoy John Kerry also praised the report but also stopped short of any new commitments.
“New @IEA report is an important guide for how the energy sector can reach net-zero by 2050”, he tweeted. “It shows that we must ramp up existing technologies to rapidly decrease emissions by 2030”.
