In the global fight against climate change, progress is often measured with commitments and targets that stretch decades into the future. On Tuesday, the International Energy Agency (IEA) offered a reality check: the time to stop investing in new fossil fuel resources is now.
“As of this year, there is no need for new fossil fuel supply investments—oil, gas, and coal,” said IEA head Fatih Birol as the agency unveiled a landmark report charting “the most technically feasible, cost‐effective and socially acceptable” path to eliminating global greenhouse emissions by 2050 and keep global temperatures from rising more than 1.5°C.
The report, titled Net Zero by 2050, is a comprehensive roadmap with milestones laid out all the way through 2050. In a decade, 60% of car sales across the globe should be electric and by 2035 all should be. By 2040, all coal-fired power plants without technology that captures their pollution should be retired. The list goes on.
What’s most striking about the report are the things it says need to happen now. The call to slow investment in oil and gas was the most disruptive in a raft of recommendations that underscored that a major shift in the way we use energy needs to happen right away—not decades or even years from now. Governments need to lay out “measurable short‐term targets and policies” to give confidence they can meet their long-term goals, the public sector needs to dole out $90 billion of public financing for clean energy demonstration projects “as soon as possible” and cars and railroads need to be electrified “immediately,” according to the report.
Taken together, the sum of those calls for action is a stark warning: the window to avoid the worst effects of climate change is closing quickly and avoiding the most catastrophic scenarios requires immediate action. “This pathway is a narrow one,” said Birol, “but still achievable.”
In the aftermath of IEA’s bombshell, global and U.S. benchmark oil prices fell Wednesday along with the share prices of most of the world’s largest oil companies.
In a sense, the report’s message isn’t anything new to those who have been paying attention. For years, activists have used the mantra “keep it in the ground” to insist that expanding fossil fuel production threatens climate catastrophe. In 2018, the Intergovernmental Panel on Climate Change, the UN’s climate science body, delivered a stark warning from the scientists who study the phenomenon saying that the world was dangerously close to 1.5°C of temperature rise, a point that, once passed, brings the world into a danger zone that could result in irreversible and catastrophic effects such as the disappearance of the Great Barrier Reef. And last year, as the COVID-19 pandemic shutdown the global economy, politicians from across the globe insisted that the crisis would serve as an inflection point for them to rethink their economies with climate change in mind.
But evidence is thin that the global economy has started moving away from fossil fuels at anywhere near the necessary pace. The oil and gas industry in particular has increasingly spoken publicly about the need to address climate change while still planning to invest billions in oil and gas development. The industry response following the report was dismissive. “Any pathway to net zero must include continued innovation and use of natural gas and oil,” said the American Petroleum Institute, the primary U.S. lobbying group for the oil and gas industry.
Enter the IEA—a surprising and important messenger. The IEA isn’t a household name, but the multilateral agency, whose membership consists of 30 countries with advanced economies, plays a key role shaping the global energy business as well as the policies that set the guardrails. The scenarios, reports and white papers generated by the IEA—not to mention the direct counsel provided by its experts to governments—help direct trillions of dollars in energy investment.
It wasn’t a given that the agency would produce this kind of ambitious roadmap. The IEA was founded in the midst of 1970s oil crises and has maintained a close link to the oil and gas industry. And, while the IEA has previously produced so-called “sustainable development scenarios” outlining how countries could reduce emissions as part of its annual World Energy Outlook reports, many activists and scientists say this work has failed to give an accurate view of the challenge ahead, while giving cover to energy firms intent on continuing to profit off oil and gas.
“Given the influence of the World Energy Outlook… it is no surprise that the current national commitments to reduce emissions under the Paris Agreement would track us on to an unacceptable warming pathway,” a group of investors, corporate leaders and scientists wrote to the IEA in 2019.
But in 2020 the IEA ramped up its focus on pushing for emissions reductions, publishing research amidst the pandemic calling for an immediate investment of trillions of dollars in clean energy to help lift countries out of the pandemic’s economic rut. “If I was a minister of a country who doesn’t put the climate change as a key priority, I would still focus on these policies,” Birol told TIME last summer, “just to create jobs and boost economic growth of my own country.”
In that spirit, the new IEA report lays out a slew of economic benefits offered by following the path it lays out: higher GDP and a net gain of 9 million jobs across the globe by 2030. That’s only nine years away. The IEA has laid out the path to get there. Whether nations follow its lead is far from assured.
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