IEA
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The Global Low-Carbon Energy Transition
Dr. Fatih Birol, Executive Director, International Energy Agency
Generation Energy, Winnipeg, Canada, 11 October 2017

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The global energy context today
Ø Global energy markets are changing rapidly
Ø North America is entering a new age of energy
Ø Solar at records highs, driven by policy support & cost reductions
Ø Electric car sales are growing exponentially
Ø Digitalization is having profound impacts on the energy sector
Ø Local air pollution remains a key driver of energy policy
Ø Current climate pledges fall short of meeting mitigation goals

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Global energy-related CO2 emissions
5
10
15
20
25
30
35
1970 1975 1980 1985 1990 1995 2000 2005 2010 2014 2015 2016
Gt
IEA analysis shows that global CO2 emissions remained flat in 2016 for a third consecutive year, although the global
economy grew; changes to the fuel mix and energy efficiency played key roles
Global CO2 emissions flat for 3 years – an emerging trend?

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Supply-side investment needs to be re-directed, not increased; demand-side investment for energy efficiency,
electrification & renewables needs to ramp up significantly
Renewables and efficiency are key to global climate change mitigation
Gt
18
22
26
30
34
38
2010 2020 2030 2040
Central Scenario
Efficiency
Renewables
CCS
Nuclear
Fuel switching
Other
2 °C Scenario
Global CO2 emissions reductions in the Central & 2 °C Scenario by technology

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The power sector is at the heart of the energy transition
More flexible power systems, including dispatchable hydro, and targeted policies are needed to integrate larger
shares of wind and solar in a secure and cost-effective way
Share of wind, solar, and hydropower in total electricity generation in selected countries, 2016
0%
10%
20%
30%
40%
50%
60%
70%
Canada Denmark Spain Italy China Germany United
Kingdom
India
Wind and solar PV Hydropower

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Price discovery through competitive auctions effectively reduces costs along the entire value chain;
Auctions with long-term contracts will drive almost half of new capacity growth
Announced wind and solar PV average auction prices by commissioning date
Competition driving renewables costs down
0
20
40
60
80
100
120
140
160
180
2012 2013 2014 2015 2016 2017 2018 2019 2020
USD/MWh
Onshore wind
average auction
price
Solar PV average
auction price

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Petrochemical
Other
Transport
70
75
80
85
90
95
Oil demand (mb/d)Transport sector transition - Trucks drive global oil demand
Trucks were responsible for nearly 40% of the growth in global oil demand since 2000; they are the fastest growing
source of oil demand, in particular for diesel
2000 2015Increase by sector
Trucks
Cars
Other transport

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CO2 emissions growth in the Reference Scenario, 2015-2050
A modern truck sector is still a long haul away
Nearly 40 countries have fuel efficiency standards for cars;
Only Canada, China, Japan and the United States have standards for trucks
Power sector Industry sector
100 200 300 400 500 600 700 800 900
Trucks
Coal use
Mt

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The potential of clean energy technology remains under-utilised
Recent progress in some clean energy areas is promising, but many technologies still need a strong push to achieve their
full potential and deliver a sustainable energy future
Energy storage
Solar PV and onshore wind
Building construction
Nuclear
Transport – Fuel economy of light-duty vehicles
Lighting, appliances and building equipment
Electric vehicles
Energy-intensive industrial processes
Transport biofuels
Carbon capture and storage
More efficient coal-fired power
●Not on track ●Accelerated improvement needed ●On track

R&D funding for clean energy has remained steady at around $37 billion/year,
leaving significant room for growth
Global clean energy R&D funding needs a strong boost
Global R&D spending
on clean energy and electricity networks
Top 3 IT company R&D spending
0
10
20
30
40
2012 2015
USD (2016) billion
Private Public
0
10
20
30
40
2012 2015
USD (2016) billion

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The global energy transition and Canada
Ø An energy transition of exceptional scope, depth & speed is needed to address
energy & environmental objectives
Ø In the transition to low carbon fuels, Canada also has a key role to play as a source
of reliable oil & gas supply to global markets
Ø Federal / Provincial / Territorial collaboration is needed to fully capitalise on
Canada’s clean energy opportunities
Ø Energy RD&D investment & technology innovation in Canada requires long-term
energy & climate policies
Ø IEA stands ready to support Canada during its Presidency of 2018 G7 and of 2019
Clean Energy Ministerial