Tracking Clean Energy Progress: 2017

Tracking Clean Energy Progress examines the progress of a variety of clean energy technologies towards interim 2°C scenario targets in 2025. Click on any of the technologies to find out more:

Status against 2°C scenario targets to 2025
On track, but sustained deployment & policies required
Improvement, but more efforts needed
Not on track
Recent trends
Positive developments
~Limited developments
Negative developments

Electric vehicles

Overview

With over 750 000 plug-in electric cars sold worldwide in 2016, a new historic record has been hit in the electrification of personal transportation. The global PEV car stock has reached 2 million units in circulation. Policy efforts need to be sustained and reinforced to accelerate wider adoption and ensure that PEV deployment will not fall short of 2DS growth rates in the coming years.

Recent trends

Even though PEV sales grew by 40% between 2015 and 2016, in line with 2DS objectives, this is a slowdown from the 70% growth observed between 2014 and 2015, suggesting an increasing risk to start diverging from a 2DS trajectory.

Recommendation for 2017

Prioritise financial incentives for purchasing PEVs and the availability of charging infrastructure. Offer local incentives favouring PEVs over conventional cars, such as access to urban areas restricted to conventional cars and preferential parking rates. Use public procurement programmes for vehicle fleets to support PEV uptake and support RD&D efforts aiming to reduce battery costs and improve performances.

Energy storage

Overview

Energy storage deployment is on track with 2DS due to positive market and policy trends, but an additional 20 GW of capacity is needed by 2025. To remain on track with the 2DS targets, technology deployment will need to continue at its current growth trajectory and grow twenty fold over the next decade.

Recent trends

Deployed storage reached 930 megawatts (MW) in 2016, with remarkable year-on-year growth of over 50% for non-pumped hydro storage.

Recommendation for 2017

Clarify the position of storage in the different steps of the electricity value chain to enhance systems-friendly deployment of energy storage and improve business cases for the use of storage in vertically-integrated markets.

Solar PV and onshore wind

Overview

Solar PV and onshore wind electricity generation are expected to grow by 2.5 times and by 1.7 times, respectively, over 2015-20. This growth trend is on track with the 2DS target, providing a solid launching pad for the further 2 times increase in solar PV and 1.7 times increase in onshore wind, respectively, required over the 2020-25 period.

Recent trends

Strong capacity growth continued for both solar PV and onshore wind, and record-low contract prices were announced in 2016.

Recommendation for 2017

Implement system-friendly solar PV and wind deployment and address market design challenges to improve grid integration of renewables.

Aluminium

Overview

Meeting the 2DS pathways will require continued efforts to improve specific energy consumption (SEC) of both primary and secondary aluminium, as well as improvement of scrap collection and recycling rates and new technologies to mitigate process CO2 emissions. To stay on track towards 2DS, overall average energy use increase by the aluminium sector needs to be limited to 4.3% per annum by 2025.

Recent trends

World average energy intensities of primary aluminium smelting and alumina refining decreased by 1.9% and 5.3%, respectively, from 2013 to 2014. In 2014, 31% of aluminium was produced from scrap, maintaining nearly the same share as in 2013, despite 6.7% growth in overall production.

Recommendation for 2017

Further incentivise the secondary production of aluminium through increased recycling of all scrap types to significantly decrease the energy and emissions intensity of production. Also incentivise material efficiency strategies to provide significant CO2 and energy savings.

Aviation

Overview

Recent annual average fuel efficiency improvements of 3.7% have exceeded industry aviation targets. Yet, with few alternatives to fossil fuels, aircraft efficiency needs to continue to improve at a rapid rate, and incremental shares of advanced biofuels need to be adopted, to be in line with 2DS targets. The WTW GHG emissions of the aviation sector are expected to grow at a rate of 2.0% per year from 2015 to 2025. Emissions must stabilise by 2025 and rapidly decrease afterwards to align with the 2DS.

Recent trends

The pace of improvement required for the recently proposed CO2 standard by the International Civil Aviation Organization (ICAO) for new aircrafts falls short of 2DS targets.

Recommendation for 2017

Introduce carbon taxes on aviation fuels based on their life cycle GHG emissions. Align the ambition of ICAO CO2 standard with the sectorial mitigation targets (carbon-neutral growth by 2020, 2% annual efficiency improvement to 2050, and halving of emissions by 2050 compared with 2005) and clarify the magnitude of the emission savings expected from the recently adopted Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) across them and with policy action.

Cement

Overview

To stay on track towards 2DS, biomass and waste fuels they need to reach 12.1% of thermal energy consumption by 2025 in the 2DS, and the overall energy use increase by the sector needs to be limited to 0.5% per annum by 2025.

Recent trends

Thermal energy intensity of cement kilns continues to improve, with the shift toward higher-efficiency dry kilns. Alternative fuels combined, including biomass and waste, contributed about 5.3% of thermal energy consumption in 2014.

Recommendation for 2017

Increase public and private support for RDD&D of alternative products, clinker substitutes and process routes to decrease cement production CO2 emissions in the long term.

Chemicals and petrochemicals

Overview

Average annual growth in the sector’s final energy consumption and direct energy-related CO2 emissions was 2.3% and 2.6%, respectively, during 2000-14, slowing down mainly by switching to lighter feedstocks made economical by price trends in some regions. This trend towards lower CO2 emissions feedstocks must be sustained in the long term to bring the sector on track to meet the 2DS. Annual increases in process energy consumption and direct CO2 emissions must stay below 3.1% and 2.8%, respectively, in spite of considerable production increases.

Recent trends

The chemicals and petrochemicals sector has made progress in shifting towards lower-carbon feedstocks in recent years, driven by price changes in some regions.

Recommendation for 2017

Improve publicly available statistics for the chemicals and petrochemicals sector, so as to robustly track progress and set appropriate targets.

Fuel economy of light-duty vehicles

Overview

Progress in improving the average tested fuel economy of light-duty vehicles (LDVs) has slowed in recent years, from an annual rate of 1.8% in 2005-08, to 1.2% in 2012 15 and only 1.1% in 2014-15. To stay on track with the 2DS, this trend must be reversed, and an annual fuel economy improvement rate of 3.7% through 2030 must be achieved.

Recent trends

Globally, the average rate of fuel economy improvements has slowed in recent years to only 1.1% in 2014-15.

Recommendation for 2017

Introduce fuel economy regulations, starting from labels and consumer information, developing fuel economy baselines and setting fuel economy improvement targets in countries that do not yet have them in place. Strengthen regulatory policies in countries where they already exist, spelling out ambitions for the long term. Make sure that annual improvement rates are compatible with long term ambitions that match the GFEI goal. Adopt supporting policy tools, including differentiated taxation and low-interest loans, also targeting second-hand vehicles traded between developed and developing countries.

Industry

Overview

Decoupling of industrial production from CO2 emissions is critical to achieve the 2DS targets. Annual growth in CO2 emissions between 2014 and 2025 needs to be limited to 0.1%, compared to 1.1% in the current pathway, with peaking of industrial CO2 emissions by 2020.

Recent trends

The industrial sector has continued to progress in energy efficiency and low-carbon technology deployment, limiting its final energy consumption y-o-y growth to 1.3% in 2014. To meet the 2DS, action must accelerate further to limit the growth in energy consumption to 1.2% per annum by 2025 and CO2 emissions remaining flat to 2025.

Recommendation for 2017

Incentivise energy efficiency improvements through mechanisms facilitating retrofitting of existing capacity and deployment of current best available technologies.

Iron and steel

Overview

Global crude steel production in electric arc furnaces (EAFs) grew from 29% in 2010 to 30% in 2014. To meet the 2DS targets, global crude steel production in EAFs, needs to grow to 40% by 2025, shifting away from basic oxygen furnaces/open hearth furnaces, with the overall energy demand of the sector declining by 6% and CO2 emissions declining by 11%.

Recent trends

Despite economic difficulties in some regions, crude steel production in EAFs continues to grow.

Recommendation for 2017

Deploy best available technologies and energy efficiency improvements in existing capacity to meet 2DS goals, including maximising deployment of scrap-based EAF production.

Lighting, appliances and equipment

Overview

Electricity consumption by lighting, appliances and building equipment needs to halve from the current 3% average increase per year over the last decade to a 1.5% annual increase in the 2DS.

Recent trends

The growing shift to light-emitting diodes (LEDs) in the last two years is encouraging, with LEDs representing 15% of total residential lamp sales in 2015 (expected to have grown to nearly 30% in 2016). Effort is needed in markets everywhere to ensure that progress carries over to high-performance appliances and equipment.

Recommendation for 2017

Countries should seize on momentum under the recent Kigali Agreement to rapidly move global markets for cooling equipment to much higher energy performances.

Natural gas-fired power

Overview

Global natural gas-fired power generation increased by 2.2% in 2014. OECD countries experienced 7.1% growth in 2015 with indications of the continuation of this trend in 2016. Generation growth in non-OECD countries is estimated to have equally remained strong into 2015 and 2016.While this growth is well above the annual growth rate needed to achieve the 2025 2DS target of 1.2%, recent declines show the fragility of the growth path. Additional progress in also needed in efficiency and flexibility performance of plants to provide support for the integration of variable renewables and serve as a short-term, lower-carbon alternative to coal plants, while preventing long-term stranding of natural gas plants.

Recent trends

Gas-fired power capacity investment declined by 40% year-on-year in 2015 to United States dollars (USD) 31 billion, leading to gas capacity additions of 46 GW.

Recommendation for 2017

Support natural gas-fired power generation as a lower carbon alternative to coal through electricity market mechanisms that establish competitiveness of gas with coal, including carbon pricing and additional support policies, such as maximum emission caps and capacity markets.

Nuclear power

Overview

The average construction starts over the last decade were about 8.5 GW per year. To meet the 2DS targets, more than a doubling is needed-to over 20 GW per year by 2025.

Recent trends

Nuclear power saw 10 GW of capacity addition in 2016, the highest annual increase since 1990, but the year brought only 3 GW of new construction starts.

Recommendation for 2017

Provide clear and consistent policy support for existing and new capacity that includes nuclear power in clean energy incentive schemes and that encourages its development in addition to other clean forms of energy.

Offshore wind and hydropower

Overview

Offshore wind generation has grown fivefold over 2010-15 and is expected to double over 2015-20. However, over 2020-25, offshore wind generation needs to triple to be fully on track with its 2DS target. For hydropower, the trend of capacity and generation growth is expected to slow down over the 2015-20 period compared with the previous five years. To be on track with 2DS 2025 targets, an increase in capacity growth rates is required.

Recent trends

Offshore wind additions in 2016 declined by a quarter year-on-year. Hydropower additions decreased for the third consecutive year in 2016.

Recommendation for 2017

Ensure timely grid connection of offshore wind plants, and continue implementing policies that spur competition to achieve further cost reductions for offshore wind. Improve market design to better value the system flexibility of hydropower.

Pulp and paper

Overview

The sector’s energy use has grown only 1% since 2000, despite a 23% increase in paper and paperboard production. Major reductions in energy use and CO2 emissions are needed in the 2DS by 2025, with energy use and direct non-biomass CO2 emissions declining by 0.8% and 17%, respectively, by 2025.

Recent trends

Research and development on innovative low-carbon processes and products, such as deep eutectic solvents, has become a priority for the pulp and paper sector in recent years, which could lead to CO2 and energy benefits.

Recommendation for 2017

Encourage optimal use of by-products as a substitute for fossil fuels, and incentivise increased recycling of paper products and pulp.

Renewable power

Overview

Over 2010-15, renewable power generation expanded by more than 30%, and it is forecast to grow by another 30% between 2015 and 2020. However, generation growth needs to accelerate further over 2020-25, by an additional 40% for renewables to reach the 2DS electricity generation target.

Recent trends

Renewable power capacity additions broke another record in 2016, with 160 GW of capacity additions. Renewable electricity generation grew an estimated 6%, representing over half of global power generation growth.

Recommendation for 2017

Accelerate growth of renewable electricity generation through policy improvements focused on both system-friendly deployment and technology development.

Transport

Overview

Transport emissions grew by 2.5% annually between 2010 and 2015. To reach 2DS targets, the sector’s well-to-wheel (WTW) greenhouse gas (GHG) emissions must remain stable from 2015 to 2025 and decrease rapidly afterwards. More specifically, WTW GHG emissions from Organisation for Economic Co-operation and Development (OECD) countries need to decline by 2.1% annually between 2015 and 2025 to reach 2DS targets.

Recent trends

CO2 emissions from transport are still growing, and the transport measures laid out in the NDCs to the Paris Agreement are not sufficiently ambitious to reach 2DS targets.

Recommendation for 2017

Increase the ambition of the EEDI and expand this framework to also include operational efficiency standards for existing ships. This requires swift action to ensure the adequate collection of data along trading patterns of individual vessels.

Trucks/heavy-duty vehicles

Overview

Countries with vehicle efficiency standards account for just over half of new heavy-duty vehicle (HDV) sales worldwide. The resultant 10% annual improvement in truck fuel economy over the coming decade is insufficient to counterbalance emissions growth due to increasing trucking activity. To attain 2DS goals, annual WTW GHG emissions growth of heavy-duty trucks must be capped at 1.75% between 2015 and 2025.

Recent trends

Heavy-duty vehicle efficiency and GHG standards have only been recently implemented in Canada, the People’s Republic of China (China), Japan and the United States. Nowhere else do such standards exist, but they would need to be adopted more broadly to achieve 2DS goals.

Recommendation for 2017

Develop vehicle efficiency and/or GHG standards for new HDV sales in major markets that do not yet apply them (e.g. Association of Southeast Asian Nations [ASEAN], Brazil, the European Union, India, Korea, Mexico, South Africa, etc.). Better data collection on truck operations is also needed to exploit opportunities to improve systems and logistics efficiencies.

Bioenergy, CSP, ocean energy and geothermal

Overview

Progress in renewable technologies at earlier technology development stages remains behind the performance needed to get on track to reach their 2DS targets.

Recent trends

Generation costs and project risks remain higher than conventional alternatives, preventing faster deployment.

Recommendation for 2017

Devise plan to address technology-specific challenges to achieve faster growth. Strategies could include: better remuneration of the market value of storage for CSP; improved policies tackling pre-development risks for geothermal energy; facilitating larger demonstration projects for ocean technologies; complementary policy drivers for sustainable bioenergy.

Buildings

Overview

Global average building energy use per person since 1990 has remained constant at 5 MWh per person per year. This rate would need to decrease to less than 4.5 MWh per person by 2025 to be in line with 2DS targets. Furthermore, current investments in building energy efficiency are not on track to achieve the 2DS targets.

Recent trends

Average global building energy intensity per square metre only improved by 1.3% last year, while total floor area grew by 3%. Progress in some countries is promising, but overall, buildings are still not on track to meet 2DS objectives by 2025.

Recommendation for 2017

Countries can take immediate action to put forward commitments for low carbon and energy-efficient buildings to implement their NDCs as a first step and a clear signal to scale up actions across the global buildings sector.

Building envelopes

Overview

Global annual average building envelope energy intensity improvements of 1.4% have been achieved since 2010. Building envelope intensities need to improve by 30% by 2025 to keep pace with growth in floor area and the demand for greater comfort.

Recent trends

Progress on building energy codes in developing regions last year is a positive step toward 2DS ambitions, but two-thirds of countries still do not have mandatory building energy codes in place.

Recommendation for 2017

Global cooperation should seek to ensure that all countries implement and enforce building energy codes and standards for both new and existing buildings, with improvement in enforcement and verification of codes and standards to overcome barriers to their implementation.

Carbon capture and storage

Overview

The total potential annual capture rate of existing projects is over 30 MtCO2, but given its current proven rate of 9.3 MtCO2, storage is falling short of meeting the 2DS. Average storage must accelerate to reach over 400 MtCO2 annually to be on track to meet the 2DS in 2025.

Recent trends

The global portfolio of large-scale CCS projects continued to expand, with the first steel plant CCS project and the first bioenergy with carbon capture and storage (BECCS) plant being deployed.

Recommendation for 2017

Strengthen public and private investment in large-scale projects and CO2 transport and storage infrastructure plans, across jurisdictions where applicable.

Coal-fired power

Overview

To get on track with the 2DS, emissions from coal power would need to decline on average by 1.7% per year until 2025. Adding to the challenge, in 2015, new coal capacity additions stood at 84 GW, 25 GW of which was subcritical. Under the 2DS, unabated coal capacity additions would have to slow down, with subcritical technology deployment abandoned altogether.

Recent trends

Global coal generation increased by 0.7% year on year in 2014 and continued to dominate global power generation in 2014, with a share of over 40%. Coal generation in 2015 and 2016 is estimated to have decreased, but pronounced regional and annual variations can be found.

Recommendation for 2017

Implement national energy plans and policies to rapidly phase out construction of plants using subcritical technology.

International shipping

Overview

Meeting the 2DS requires the global shipping fleet to improve its fuel efficiency per ship-km with an annual rate of 2.3% between 2015 and 2025. Yet, the Energy Efficiency Design Index (EEDI) of the IMO, applying to new ships only, results in a fleet average of 1% annual efficiency improvement per ship-km to 2025. The gap in ambition between these rates of improvement needs to be addressed to achieve the 2DS.

Recent trends

The International Maritime Organization (IMO) has made progress in agreeing on regulations on reducing sulphur oxide (SOx) and nitrogen oxide (NOx) emissions from ships. Yet its GHG policy is still under consideration: an initial GHG strategy is expected by 2018, which will be a stepping stone to the final strategy expected by 2023. Implementing IMO’s final GHG strategy only by 2023 will have very little impact on the possibility of meeting 2025 2DS targets.

Recommendation for 2017

Strengthen enforcement mechanisms for emissions from ships and the EEDI, including inspections, sanctions and legal frameworks, to ensure compliance with IMO measures. Stimulate the engagement of ports in encouraging GHG reductions in ships, e.g. with bonus/malus schemes supporting clean ships from fees applied to ships with poorer environmental performances. Introduce carbon taxes on shipping fuels based on their life cycle GHG emissions.

Renewable heat

Overview

The direct use of renewables for heat (efficient biomass, solar thermal and geothermal) increased by 8% from 2010 to 2014. Yet, renewable heat use remains largely unexploited, in spite of promising potential. An increase in consumption of direct renewables for heat by 32% is needed by 2025 to meet the 2DS. For solar thermal, heat production would have to triple by 2025, requiring doubling of the current annual deployment rate.

Recent trends

Renewable heat has seen some growth in recent years but at a much slower rate than for renewable electricity.

Recommendation for 2017

Governments should set targets and develop strategies for heat decarbonisation that cover all sectors and consider the appropriate balance between renewable heat deployment, heat electrification and energy efficiency improvement.

Transport biofuels

Overview

Conventional biofuels are generally on track to meet 2DS requirements by 2025. However, in excess of 57 billion litres of advanced biofuels are required by the 2DS in 2025. Based on forecasted advanced biofuel production growth to 2020, rapid commercialisation will be necessary over 2020-25 to deliver a twenty-five-fold scale-up in output to stay on track with the 2DS.

Recent trends

Global biofuel production increased by 2% in 2016, a significantly slower rate than pre-2010 levels. However, policy support for advanced biofuels is growing, including the announcement of advanced biofuel mandates in an increasing number of European countries.

Recommendation for 2017

Enhance advanced biofuel policies, including mandates, frameworks limiting the life-cycle carbon intensity of transportation fuels, and financial de-risking measures for advanced biofuel plant investment while costs remain high.