Image: © Habman18/Stock.adobe.com
PwC highlights that the growing demand for energy continues to outpace the adoption of renewables.
Carbon intensity, which is a measure of clean electricity, refers to how many grams of carbon dioxide (CO2) are released while producing a kilowatt hour of electricity. Last year, the required rate of carbon intensity reduction to limit global heating to 1.5°C above pre-industrial levels was 17.2pc, however, the world only achieved 1.02pc.
The data was revealed in this year’s annual PwC Net Zero Economy Index, an analysis that tracks economic growth and CO2 emissions data against the rates required to achieve targets set by the Paris Agreement.
The rate of carbon intensity reduction last year was the smallest drop since 2011 and a far cry from the year-on-year rate of decarbonisation of 20.4pc now required to keep global heating below 1.5 degrees Celsius.
This means that the world must now decarbonise at a rate 20 times faster than what it achieved last year.
Temperatures reaching more than 1.5 degrees Celsius is fast becoming a reality and limiting global heating to 2 degrees Celsius – the lowest end of the Paris Agreement’s target – would require an annual global decarbonisation rate of 6.9pc, according to the Index.
While some progress is being made, with the global renewable energy capacity hitting a record high – increasing by 14pc to 3,870 gigawatts (GW) from 2022 to 2023 – and set to become the largest electricity source by 2025, fossil fuel consumption also increased by 1.5pc in 2023 to 16,007GW.
The growing energy demand from economies continues to outpace the adoption of renewables with additional challenges like inflation and geopolitical tensions further complicating the transition away from fossil fuels.
However, a separate PwC study with the World Economic Forum found that current technology can enable the world to reduce its energy needs by approximately a third (31pc) without reducing economic output – which could lead to a possible annual savings of up to $2trn at current energy prices.
Even with lowered emissions, Ireland is off target
Echoing previous reports, the PwC Index reveals that Ireland is still not on track to meet either the national or EU emissions reductions targets for 2025 or 2030.
According to the index, Ireland reduced its carbon intensity by 2.7pc in 2023, performing better than the global average of 1pc. Similarly, the country reduced its fuel factor – or how much CO2 is emitted per unit of energy consumed – by 2.6pc, better than the 0.1pc global average. However, even that is far off the required reduction of 16.9pc.
Meanwhile, Ireland’s energy consumption for the year remained unchanged.
According to PwC, one of Ireland’s 2030 targets under the EU’s Effort Sharing Regulation (ESR) is to achieve a 42pc reduction in emissions by 2030, compared to 2005 levels. However, Environmental Protection Agency projections currently show Ireland achieving only a 9pc to 25pc reduction on 2005 levels.
In 2023, Ireland’s emissions fell to a three-decade low with a 6.8pc reduction compared to 2022, which PwC called a “significant milestone”. However, the professional services firm pointed out that the country’s Climate Change Council has warned that the cost of not meeting the ESR targets could exceed €8bn.
David McGee, the PwC environmental, social and governance leader said: “The gap Ireland needs to bridge is significant and requires immediate and intensified efforts across all sectors to accelerate incremental progress into exponential change.
“Time is running out to bridge the gap between ambition and action to ensure a sustainable and resilient future for all.”
The report also highlighted the disparity of decarbonisation rates between developing and developed countries, showcasing the need for greater financial support in the transition to renewables.
“As COP29 takes place, we urgently need an ambitious New Collective Quantified on climate finance to empower developing nations to meet their climate goals,” said McGee.
Recently, the Sustainable Energy Authority of Ireland assessed the country’s performance against the national Climate Action Plan and EU targets and found a “severe risk” of delayed achievement of the majority of the plan’s targets including for renewable electricity, biomethane, electric vehicles and building energy efficiency upgrades.
Don’t miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic’s digest of need-to-know sci-tech news.
