Solar power and batteries are bringing forward the peak of global energy sector emissions. However, slow progress in other areas (including offshore wind, electrification of hard-to-abate sectors, hydrogen, third-generation nuclear, and CCS) will reduce emissions by only 5% by 2030
The energy emissions peak will likely occur as early as 2024, but it won’t be enough to meet the Paris Agreement climate goals. Solar power and storage play a crucial role in reversing the energy sector’s emission trajectory, but the decline will be slower than needed. Major obstacles include the slow expansion of renewables, limited progress in hard-to-abate sectors where electrification isn’t a viable option, and energy policies misaligned with climate targets. This is according to the Energy Transition Outlook 2024 report by Norwegian consulting firm DNV.
Towards the Energy Emissions Peak
The key factor driving DNV to predict the energy emissions peak for this year is the solar boom, increasingly paired with storage capacity, making clean energy available 24 hours a day. Solar panel and battery costs are expected to keep falling. Annual solar installations grew by 80% last year and will continue, albeit at a slightly slower pace. Solar is eating into coal’s share: global coal consumption in power plants is lower in 2024 than in 2023. In the next decade, coal growth is expected only in the Indian subcontinent.
Another important driver is the penetration of electric vehicles (EVs). The expansion is “so strong” that China has already surpassed its peak gasoline demand, while the global oil peak is expected within the next two years. EVs are on track to make up 50% of new registrations globally by 2031.
Decline or Plateau?
What happens next year? DNV offers little room for optimism. The reduction in energy emissions in 2025 is “marginal and uncertain,” at just -0.4%. Global political and economic uncertainties weigh heavily. Other factors slowing the decline after the energy emissions peak include:
- The slow adoption of decarbonization solutions in hard-to-electrify sectors such as heavy industry, maritime transport, and aviation.
- A sharp increase in global air travel demand.
- Low penetration of hydrogen in hard-to-abate sectors and other solutions like carbon capture and storage (CCS), which will capture just 2% of global emissions by 2040.
- Underperformance of offshore wind and third-generation nuclear (small reactors).
- Slow progress in energy efficiency, with global energy intensity improving by only 2% by 2030 (compared to the 4% target set at COP28).
Looking ahead, DNV suggests that global CO2 emissions linked to energy will only decrease by 5% by 2030 compared to 2023 levels. By 2050, CO2 emissions will reach 17 billion tons (Gt), halving from today’s levels. However, this reduction should be achieved 20 years earlier according to the IPCC’s transition scenarios.
“Cumulative emissions drive global temperature rise, and we are likely heading towards 2.2°C warming by 2100,” DNV concludes.
Read the full Energy Transition Outlook 2024 report here.
