Press releases

Increased reliance on natural gas risks an emissions lock-in – Climate Action Tracker

Published: 22/06/2017

The future of natural gas is limited, even as a bridging fuel. Continued investments into the sector create the risk of breaching the Paris Agreement’s long term temperature goal and will result in stranded assets, the Climate Action Tracker (CAT) said today.

As part of its decarbonisation series, the CAT today released an examination of gas in the power sector.  The report, titled Foot off the gas: an increased reliance on natural gas in the power sector risks an emissions lock-in”, warns that natural gas will have to be phased out along with coal, if the world is to limit warming to 1.5˚C, as spelt out in the Paris Agreement long term temperature goal.

The CAT foresees a dwindling role for natural gas in the power sector toward the middle of the century, not only to meet the Paris Agreement goals, but also due to increasing competition from renewables.

This outlook challenges projections that forecast an increase in natural gas consumption. Although these projections have proven too bullish in the past, governments and companies are staking significant investments in natural gas infrastructure on them, ignoring the increasing role of low-carbon alternatives, and the need to reduce emissions to combat climate change.

“Natural gas is often perceived as a ‘clean’ source of energy that complements variable renewable technologies.  However, there are persistent issues with fugitive emissions during gas extraction and transport that show that gas is not as ‘clean’ as often thought,” said Bill Hare of Climate Analytics.  “Natural gas will disappear from the power sector in a Paris Agreement-compatible world, where emissions need to be around zero by mid-century.” 

Although the emissions from gas plants can be reduced by up to 90% with Carbon Capture and Storage (CCS), this is not sufficient for full decarbonisation.  Even if these capture rates could be increased, ultimately, the cost of gas with CCS is unlikely to be competitive with renewables and a flexible grid, the CAT said.

“The idea of a continuing role for natural gas as a bridging technology is not consistent with the reality of advances in flexibility enabling technologies, such as grid expansion, supply and demand response, as well as storage,” said Yvonne Deng of Ecofys, a Navigant company. 

Many projections for the use of natural gas—including from the International Energy Agency, investors, and many governments—not only fail to consider the need for complete decarbonisation within three decades, but they also ignore the increasing role of low-carbon alternatives.

“One example is China, where in 2016 the IEA projected renewables would rise to 7.2% of the power supply by 2020—but by the end of 2016 they had already reached 8%. Additionally, India and the Middle East are also seeing renewables rising much faster than mainstream projections,” said Niklas Höhne from NewClimate Institute. 

Despite these developments, massive investments into LNG pipelines and terminals continue, even as the utilisation rates of such infrastructure are decreasing.  For example, utilisation rates in US natural gas infrastructure are at 54%, and are even lower in Europe at 25%. 

“This overinvestment in natural gas infrastructure is likely to lead to either emissions overshooting the Paris Agreement’s 1.5°C and 2°C goals—or a large number of stranded assets as the shift to cheaper renewables takes place, “ said Andrzej Ancygier of Climate Analytics.

Contacts
Andrzej Ancygier, Climate Analytics: +49 30 259 22 95 38, andrzej.ancygier@climateanalytics.org
Niklas Höhne, NewClimate Institute: +49 173 715 2279, n.hoehne@newclimate.org
Bill Hare, Climate Analytics: +49 160 908 62463, bill.hare@climateanalytics.org
Yvonne Deng, Ecofys: + 44 7788 973 714, y.deng@ecofys.com 

www.climateactiontracker.org
The Climate Action Tracker is an independent science-based assessment that tracks the emission commitments and actions of countries. It is a joint project of the following organisations:

Climate Analytics
Climate Analytics is a non-profit institute based in Berlin, Germany, with offices in Lomé, Togo and New York, USA, that brings together inter-disciplinary expertise in the scientific and policy aspects of climate change with the vision of supporting science-based policy to prevent dangerous climate change, enabling sustainable development. Climate Analytics aims to synthesise and advance scientific knowledge in the area of climate, and by linking scientific and policy analysis provide state-of-the-art solutions to global and national climate change policy challenges. Contact: Dr. h.c. Bill Hare, +49 160 908 62463
www.climateanalytics.org

Ecofys – A Navigant Company 
Ecofys, a Navigant company, is a leading international energy and climate consultancy focused on sustainable energy for everyone. Founded in 1984, the company is a trusted advisor to governments, corporations, NGOs, and energy providers worldwide. The team delivers powerful results in the energy and climate transition sectors. Working across the entire energy value chain, Ecofys develops innovative solutions and strategies to support its clients in enabling the energy transition and working through the challenges of climate change. Contact: Prof. Kornelis Blok, +31 6 558 667 36
ecofys.com

NewClimate Institute
NewClimate Institute is a non-profit institute established in 2014. NewClimate Institute supports research and implementation of action against climate change around the globe, covering the topics international climate negotiations, tracking climate action, climate and development, climate finance and carbon market mechanisms. NewClimate Institute aims at connecting up-to-date research with the real world decision making processes. Contact: Dr. Niklas Höhne, +49 173 715 2279
www.newclimate.org