US$78 TRILLION REQUIRED TO ACHIEVE NET ZERO BY 2050 - WOOD MACKENZIE

KUALA LUMPUR, Oct 30 (Bernama) -- Wood Mackenzie in its latest ‘Energy Transition Outlook’ report revealed that US$78 trillion of cumulative investment is required across power supply, grid infrastructure, critical minerals and emerging technologies and upstream to meet Paris Agreement goals, a legally binding international treaty on climate change. (US$1=RM4.36)

According to the report, a string of global shocks has likely put 2030 emissions reduction targets out of reach, but with decisive action, there is still time to reach net zero emissions by 2050.

The new report analyses four different pathways for the energy and natural resources sector, Wood Mackenzie’s base case (2.5-degrees), country pledges scenario (two-degrees), net zero 2050 scenario (1.5-degrees) and delayed transition scenario (three-degrees), according to a statement.

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It also found that globally, energy demand is growing strongly due to rising incomes, population and the emergence of new sources of demand, including data centres and transport electrification. 

“Electricity’s share of final energy demand steadily rises from 23 per cent today to 35 per cent by 2050 in our base case. And, in an accelerated transition such as our net zero scenario, the share of electricity increases to 55 per cent by 2050,” said Wood Mackenzie vice president, head of scenarios and technologies, Prakash Sharma.

The report showed that strong renewables growth is a certainty and this will continue under all scenarios modelled in this update with renewables capacity growing two-fold by 2030 in the base case, short of the global pledge made at COP28 to triple renewables by 2030.

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Solar is the biggest contributor of renewable electricity, followed by wind, nuclear (including large and small reactors) and hydro. Together, renewables’ share rises from 41 per cent today to up to 58 per cent by 2030 and up to 90 per cent by 2050, depending on the scenario.

Meanwhile, nuclear’s ability to supply zero-carbon electricity round-the-clock is finding favour with technology companies building data centres capacity. Wood Mackenzie projects nuclear capacity to double in its base case and triple in its net zero scenario by 2050, compared with 383 gigawatts (GW) last year.

In addition, oil and gas are projected to continue playing a role in the global energy system to 2050, and innovation will improve the commerciality of carbon capture and low-carbon hydrogen and derivatives, driving uptake to six billion tonnes of carbon capture (Btpa) and 0.45 Btpa by 2050.

Policy certainty is crucial to helping unlock demand for new technologies and increase capital flow into all segments, including supply chains and critical minerals.

-- BERNAMA