- Carbon/Climate Change
+1.7% in energy-related CO2 emissions in 2018 but Europe on a positive trend
As in 2017, energy-related CO2 emissions increased this year, according to the latest IEA’s Global energy and CO2 status report. While the increase stood at 1.4% in last year’s report, it reached 1.7% this year, with notable growth rates being observed in almost all the main regions and countries, as described below. For example, energy-related CO2 emissions increased by 2.5% in China and 3.1% in the USA during the last year. In fact, among key emitters, only Europe stands out positively on this basis, with a -1.3% reduction.
This is, of course, a positive factor supporting the climate performance of many sovereign issuers and corporates in the European region even if more improvements are to be observed in terms of energy intensity of the GDP. For example, at the global level, the energy intensity of GDP (in tonnes per USD 1000 PPP) improved by 1.3% between 2017-2018.
2017-2018 variation of energy-related CO2 and primary energy demand
It remains that efficiency improvements are currently insufficient to counter-balance the effects of GDP trends on total energy-related CO2 emissions. In the context of economic growth, even coal demand continues to increase. Of course, the growth of renewables is much higher in relative terms but it is also starting from a much lower point. In this context, if 2017-2018 energy demand trends were to be projected on the long-term (which would, of course, raise many questions in terms of climate impacts), it would take no less than 22 additional years for renewables to reach the same share of total primary energy demand as the current share of coal, with a multiplication of renewables production by 10 (based on hydro and other renewables excluding biomass/waste).
Guillaume Emin, Head of Client Solutions.
Sources: Beyond Ratings