The United Nations Framework Convention on Climate Change (UNFCCC) negotiations have the potential to instigate a significant increase to the ambition of both governments and the private sector with regard to the global effort to reduce greenhouse gas (GHG) emissions and manage the risks of climate change. Over the past 2 decades, IPIECA has actively participated in UN climate negotiations. Ahead of, during and after COP21, we’re renewing our efforts to engage with stakeholders and governments in the UNFCCC process.
Over the past 2 centuries, oil and gas have become central pillars of the global energy system and the main drivers of economic development. Today, oil production alone keeps one billion cars on the road, some 20,000 commercial jet airliners in the air and at least 50,000 trading vessels at sea. Natural gas provides almost 40% of global residential space heating, and 22% of electricity generation, while also providing heat and motive power to a significant portion of the world’s industrial base. Both oil and gas are essential feedstocks for many manufacturing processes. Together, they currently provide over 50% of global primary energy supply. The widespread use of these 2 resources arises from their many important benefits, including energy density, storability, transportability, flexibility of use and affordability.
Demand for oil and gas continues to rise in tandem with population size and the industrialization of developing economies. Given the primary role of energy in raising living standards, access to energy is widely recognized as a fundamental priority. As such, the UN has listed “access to affordable, reliable, sustainable and modern energy for all” as goal #7 in the draft UN Sustainable Development Goals. While enabling over 200 years of industrialization and development, the use of coal, oil and gas have contributed substantially to the rise in atmospheric carbon dioxide (CO2) from 275 ppm in 1750 to 400 ppm today. This in turn has contributed to a warming of the climate system. Non-energy sectors such as cement calcination, agriculture, farming, forestry and land-use change are also major contributors to GHG emissions, and are equally or more difficult to mitigate. In order to stabilize atmospheric GHG concentrations and global temperature, the world will need to transition to a lower-carbon energy system.
The pathway to a future of low-emissions
IPIECA is the global oil and gas industry association for environmental and social issues, and we represent over 60% of international and national oil and gas production. We bring together industry leaders to work collectively towards progress on environmental and social performance. In June 2015, 6 months before the 21st session of the Conference of Parties (COP21), we released The Paris Puzzle: The Pathway to a Low-emissions Future.
This lays out our global membership’s views on the challenges the world faces in transitioning to a low-emissions future, and identifies the critical parts of the puzzle: Meeting energy needs; effective policy; managing our emissions; natural gas; and, carbon capture and storage.
We recognize that a low-emissions global energy system would look significantly different from today’s and that such a transformation poses a major challenge to accomplish. IPIECA with the Paris Puzzle proposal:
recognizes that addressing the risks of climate change is a challenge for our generation and will be for those to come. Meeting the challenge will require actions from all parts of society. Significant policy action, technological development and business response will be needed over many decades. The oil and gas industry can play a key role in helping society to meet the challenge.
supports and encourages governments in their efforts to reach an effective and clear international agreement to reduce greenhouse gas emissions and to manage the risks of climate change.
believes it is possible to address climate change risks while also meeting growing global energy demand and supporting economic development. As an industry, we are already taking a range of actions across our own operations and products to support these goals.
Today, global CO2 emissions from all anthropogenic sources stand at some 40 billion tons per annum. Energy use and CO2 emissions occur far beyond the power generation and transport sectors, and are associated with the manufacturing or provision of almost everything we use, buy, wear, eat and do.
The sustainable energy dilemma
Recently, the concept of net-zero or near-zero CO2 emissions has been put forward by stakeholders and proposed as a possible long-term goal under the UNFCCC. Net-zero CO2 emissions means that the sum of all emissions, including those from fossil fuels and various land-use sources, would match the emissions removed by carbon capture and storage (CCS) and sinks including land and forestry. The achievement of a net-zero emissions goal would be extremely challenging. Transforming the global energy system to be low-carbon would require extensive changes to many parts of society and local and national economies. Significant support for mitigation technologies and approaches would be needed, energy economics and consumption patterns would need to change substantially, and consumers would need to accept these shifts. But whatever the final destination, society, policymakers, business and civil society should start now in making the long transition. We support and encourage the international community’s efforts to address the risks of climate change and believe the oil and gas industry has an essential part to play in this transition, by improving the efficiency of existing technologies and resources and contributing to the development of new ones. An energy system that powers and moves a modern society while also delivering significant global, economy-wide carbon reduction presents a sustainable energy dilemma. Each energy option has challenges that will need to be addressed to resolve this dilemma. In general, most energy sources have issues to varying degrees around public acceptability and environmental impact. For fossil fuels, their use can be combined with CCS to mitigate CO2 emissions, although significant barriers remain. Renewable resources and technologies have significant long-term potential and are growing fast, but suffer from high cost, intermittency and other barriers, and so are starting from a very low baseline of energy delivered.
All the pieces of the puzzle can fit together
We believe the oil and gas industry must be a key part of the climate change solution. Our industry’s history of innovation, global reach, knowledge and technical expertise uniquely positions it to help develop and provide credible future energy solutions, with many pieces of the puzzle already being addressed. IPIECA has created a series of papers intended to address what we see as key components of efforts or ‘pieces of the puzzle’ to address climate change and demonstrate our commitment to meeting the challenge.
The importance of an open dialogue
We strive for ongoing transparency and dialogue with stakeholders on the crucial topic of climate change. Our members have been engaging in UN processes on climate change for over 20 years.
Improving our understanding of the physical science of climate change, potential impacts, and options for mitigation and adaptation provides a solid foundation for decision making. The association continues to partner with a number of academic institutions and projects aimed at improving knowledge, such as the MIT Joint Program on the Science and Policy of Global Change and the EU Joint Research Centre on the life-cycle analysis of our products. We regularly engage in the Intergovernmental Panel on Climate Change (IPCC) scientific assessment process and have contributed to both its Assessment Reports as well as Special Reports. The association also organizes side-events at the UNFCCC’s meetings to further facilitate and encourage active dialogue. Reporting also helps to establish a basis for transparency and facilitates the development of emission mitigation and risk management processes. Many companies within the industry were early adopters and developers of methodologies for accounting and reporting GHG emissions, with IPIECA developing the first sector guidance back in 2004. Understanding the sources and quantity of emissions is essential to achieve the emission reductions that are needed. The association continues to develop guidance for oil and gas companies on GHG reporting, including the Sustainability Reporting indicators, and the GHG reduction project guidance series. Our industry is a central part of the dialogue on the pathway to a low-emissions future. We underscore the importance of partnerships between all sectors and stakeholders to build on existing performance and expertise, improve understanding and ultimately make progress in meeting this complex challenge.