IEA: ‘We can avoid 95 exajoules a year of final energy consumption by end of decade’
SØNDERBORG, Denmark, 8 June 2022: Global energy and climate leaders are gathering in Denmark for a major ministerial meeting that could drive urgently needed improvements in energy efficiency, with new analysis by the International Energy Agency (IEA) showing that stronger efficiency measures can reduce energy bills, fuel imports and greenhouse gas emissions quickly and significantly.
The IEA’s 7th Annual Global Conference on Energy Efficiency in Sønderborg, Denmark, from June 7-9, is bringing together more than 20 Ministers from countries around the world, including Denmark, Germany, Hungary, Indonesia, Ireland, New Zealand, Nigeria, Panama, Senegal, Sweden and the United Kingdom – as well as African Union Commissioner for Infrastructure and Energy, Amani Abou-Zeid and European Commissioner for Energy, Kadri Simson. Ukrainian Energy Minister, Herman Halushchenko will address the Conference live via video link. Decision-makers from industry, finance, international organisations and civil society will also participate in the discussions.
With the world contending with its biggest energy crisis since the 1970s, the focus of the Global Conference is on how to implement measures quickly to reduce energy use, with the aim of easing cost pressures on consumers, cutting reliance on fuel imports and driving progress towards climate goals – while supporting job creation and economic growth. The new IEA analysis, published to coincide with the Global Conference, underscores the vital role of energy efficiency and energy saving in meeting today’s crises by immediately addressing the crippling impacts of the spike in energy prices, strengthening energy security and tackling climate change.
Fatih Birol, Executive Director, IEA, said: “Energy efficiency is a critical solution to so many of the world’s most urgent challenges – it can simultaneously make our energy supplies more affordable, more secure and more sustainable. But inexplicably, government and business leaders are failing to sufficiently act on this. The oil shocks of the 1970s set in motion major advances in efficiency, and it is utterly essential that efficiency is at the heart of the response to today’s global energy crisis. The leaders meeting at the IEA Global Conference on Energy Efficiency need to make this the moment when the world hits the accelerator on efficiency – or we may fail to respond to the current energy crisis properly and pay the price for years to come.”
This year’s Global Conference is jointly organised by the IEA and Denmark’s Ministry of Climate, Energy and Utilities, with support from Danish engineering company, Danfoss.
Dan Jørgensen, Denmark’s Minister of Climate, Energy and Utilities. said: “It’s no longer a question of whether we should implement more energy-efficient solutions and technologies, globally – it’s a question of how we are going to do that. By increasing our energy efficiency, we can reduce our dependence of Russian oil and gas completely and move closer to achieving climate neutrality. The conference in Sønderborg and the gathering of energy and climate leaders from various sectors and all parts of the world is an important step in the right direction.”
Kim Fausing, CEO, Danfoss, said: “If the world is to meet climate goals to limit global warming, energy efficiency measures must be prioritized. A third of the reduction needed in CO2 emissions this decade, according to the IEA net-zero scenario, must come from improvements in energy efficiency. The good news is that the solutions are there to improve energy efficiency in all sectors. We don’t need to wait. We need action because the greenest energy is the energy we don’t use.”
On the main conference day, on June 8, leaders in industry, government and civil society are discussing issues, such as buildings of the future, the role of consumer behaviour and how to unlock financing for efficiency measures. The following day will include a unique closed-door session, where Ministers from around the world will share best practices on how to accelerate progress. The town of Sønderborg will also host a number of technological showcases for the leaders to visit.
According to the new IEA analysis, doubling the current global rate of energy intensity improvement to four per cent a year has the potential to avoid 95 exajoules a year of final energy consumption by the end of this decade, compared with a pathway based on today’s policy settings. This is equivalent to the current annual energy use of China. That level of savings would reduce global CO2 emissions by an additional 5 billion tonnes a year by 2030, about a third of the total emissions reduction efforts needed this decade to move the world onto a pathway to net-zero emissions by mid-century, as laid out in the Net Zero Roadmap the IEA published last year.
These extra efficiency efforts would cut global spending on energy. For example, households alone could save as much as USD 650 billion a year on energy bills by the end of the decade compared with what they would have spent in a pathway based on today’s policy settings. The amount of natural gas that the world would avoid using as a result of this would be equal to four times what the European Union imported from Russia last year, while the reduced oil consumption would be almost 30 million barrels of oil per day, about triple Russia’s average production in 2021. Compared to today, this global push on efficiency would help create 10 million additional jobs in fields including building retrofits, manufacturing and transport infrastructure.
The new IEA analysis shows the significant opportunities for rapid energy efficiency gains in all sectors of the global economy. Most of these opportunities involve readily available technologies and would fully pay for themselves through lower running costs, especially at today’s high energy prices. By 2030, around a third of the avoided energy demand comes from deploying more efficient equipment, ranging from air conditioners to cars. About a fifth comes from electrification, such as switching to heat pumps or electric cars. Digitalisation and use of more efficient materials in industry provide much of the rest.
The new analysis complements the insights on the critical role of energy efficiency and energy-saving measures in addressing today’s global energy crisis that were highlighted by the IEA’s recent 10-Point Plan to Reduce the European Union’s Reliance on Russian Natural Gas and 10-Point Plan to Cut Oil Use, as well as Playing my part: How to save money, reduce reliance on Russian energy, support Ukraine and help the planet, which was developed in cooperation with the European Commission.
Johnson Controls issues USD 500 mn sustainability-linked bond
CORK, Ireland, 16 September 2021: Johnson Controls (JCI) said it has issued its first Sustainability-Linked Bond offering of USD 500 million in 10-year senior notes. The offering of the bond, the company said through a Press release, is in conformity with the company’s recently published integrated green, social and sustainability-linked finance framework. The publication of the framework and issuance of a bond mark two new sustainability milestones for Johnson Controls, which has become the first S&P500 industrial company to complete both accomplishments, it said.
Earlier, in January 2021, Johnson Controls adopted a new set of ambitious environmental goals, which it said, were approved by the Science Based Targets Initiative. The company said it has committed to cut operational emissions by 55% and reduce customers’ emissions by 16% before 2030. Based on the commitments, the company said, it issued the bond, which ties the interest rate on the bond to the achievement of the environmental goals. This means that Johnson Controls will pay a higher interest rate to bond investors if it fails to meet its interim targets for reducing Scope 1 + 2 and Scope 3 carbon emissions by September 16, 2025.
“Experts say that an additional USD 1-2 trillion/year must be invested in sustainability and cutting greenhouse gases if we are going to have any chance of meeting the steep carbon reductions science tells us is urgently required,” said George Oliver, Chairman and CEO, Johnson Controls. “Governments alone will not be able to mobilize this sum of money, so private sector capital needs to get sustainable, and fast. Building the market for sustainable finance is, therefore, an imperative; and ensuring that the highest standards are met so that dollars flow to projects that truly accelerate decarbonization, is also critical. With our continued commitment to sustainable finance and aggressive sustainability targets, we are showing our leadership in the field.”
OECD: Climate finance from developed to developing countries totalled USD 79.6 bn in 2019
PARIS, France, 17 September 2021: Climate finance provided and mobilised by developed countries for developing countries totalled USD 79.6 billion in 2019, up two per cent from 78.3 billion in 2018, according to new figures from the OECD.
The small increase was driven by a rise in public climate finance provided by multilateral institutions, while bilateral public climate finance commitments dropped, as did climate finance mobilised from private sources, OECD said through a Press release, issued for the purpose of sharing the new figures.
‘Climate Finance Provided and Mobilised by Developed Countries: Aggregate trends updated with 2019 data’ is the OECD’s fourth assessment of progress towards the UNFCCC goal of mobilising USD 100 billion per year by 2020 to help developing countries tackle and adapt to climate change.
“Climate finance continued to grow in 2019, but developed countries remain USD 20 billion short of meeting the 2020 goal of mobilising USD 100 billion,” Mathias Cormann, OECD Secretary-General, said. “The limited progress in overall climate finance volumes between 2018 and 2019 is disappointing, particularly ahead of COP26. While appropriately verified data for 2020 will not be available until early next year, it is clear that that climate finance will remain well short of its target. More needs to be done. We know that donor countries recognise this, with Canada and Germany now taking forward a delivery plan for mobilising the additional finance required to reach the USD 100bn a year goal.”
The report finds that public climate finance from developed countries reached USD 62.9 billion in 2019. Bilateral public climate finance accounted for USD 28.8 billion, down 10% from 2018, and multilateral public climate finance attributed to developed countries accounted for USD 34.1 billion, up by 15% from 2018, the report revealed. The level of private climate finance mobilised was down four per cent at USD 14.0 billion in 2019, after USD 14.6 billion in 2018. Climate-related export credits remained small at USD 2.6 billion, accounting for just three per cent of total climate finance, the report said.
The report also shows that out of the overall climate finance in 2019, 25% went to adaptation (up from 21% in 2018), 64% went to climate change mitigation activities (down from 70% in 2019), and the remainder to cross-cutting activities. More than half of total climate finance targeted economic infrastructure – mostly energy and transport – with most of the remainder going to agriculture and social infrastructure, notably water and sanitation, the report said.
Asia has been the main beneficiary of climate finance over 2016-19, with 43% of the total, on average, followed by Africa (26%) and the Americas (17%), the report said. Climate finance for Least Developed Countries rose strongly in 2019 (up 27% on 2018), but funding for Small Island Developing States fell back to 2017 levels (from USD 2.1 billion to 1.5 billion) after a temporary increase in 2018, the report pointed out.
The data confirm that SIDS face specific challenges in accessing climate finance. The international community needs to consider financing for climate that is appropriate for the challenges that SIDS face, less fragmented, easier to access, predictable and long-term, the report said.
Cormann said: “It is more urgent than ever that developed countries step up their efforts to deliver finance for climate action in developing countries, particularly to support poor and vulnerable countries to build resilience against the growing impacts of climate change.”
In terms of public finance instruments, public grant financing jumped by 30% from 2018 to reach USD 16.7 billion in 2019, after having remained stable the three previous years. In contrast, the volume of public loans, which had increased significantly up to 2018, fell by five per cent in 2019. As a result, the share of grants in overall public climate finance was 27% in 2019, while loans (both concessional and non-concessional) represented 71%.
JCI named to FT European Climate Leaders list
CORK, Ireland, 18 May 2021: Johnson Controls (JCI) said it has been named to the inaugural FT Climate Leaders in Europe list.
Europe’s Climate Leaders 2021 is a list of companies across Europe that have shown the highest reduction of their emission intensity – that is, core greenhouse gas emissions in relation to revenues, between 2014 and 2019. Johnson Controls reported that it was one of only 300 companies selected from 4,000 across Europe.
“We are extremely proud to be recognized by the Financial Times as a European climate leader,” said George Oliver, chairman and CEO, Johnson Controls. “Sustainability has long been at the heart of everything we do, and it is an honor to be included on this prestigious list. With COP26 approaching at this critical moment in the battle against climate change, it is important that companies continue to play their part in cutting emissions and delivering clean, sustainable solutions across the entire value chain.”
According to JCI, companies on the list – compiled by research firm, Statista – were invited to submit emissions reported following the emission categories of the greenhouse gas protocol (scope 1, 2 and 3). In addition, Statista scrutinized publicly available data, mainly from financial and non-financial reports as well as from CDP (formerly the “Carbon Disclosure Project”).
Although JCI reports all three emissions scopes, the ranking only considers scope 1 and scope 2 emissions, since not all companies publish their scope 3 emissions, it said. Since 2002, JCI said, it has reduced its emissions intensity by more than 70% – equivalent to the carbon sequestered by 17,000 acres of forest. The company said it has also helped its customers save more than 30.6 million tonnes of CO2 globally and $6.6 million through guaranteed operational savings.
At the European level, JCI said, it has been effectively supporting the EU’s ambition to become carbon neutral by 2050. The European Commission recently committed to at least 55% cuts in greenhouse gas emissions (from 1990 levels) by 2030 under the European Green Deal. Decarbonizing Europe’s building stock through the European Commission’s Energy Performance of Buildings Directive has a crucial role to play in this effort – 40% of greenhouse gases come from buildings, the company said.
According to JCI, digitalization has been recognized as a key enabler for the building renovation wave in Europe and the rest of the world. Already, JCI said, it has been deploying its OpenBlue digital platform for optimizing buildings sustainability across its entire value chain – drastically improving the company’s own environmental impact and helping customers consume less energy, conserve resources and identify pathways to achieving healthy, net zero carbon communities.
Katie McGinty, Vice President & Chief Sustainability, Government and Regulatory Affairs Officers, JCI, said: “We are making positive change within our own corporation and believe we are uniquely positioned to help customers and suppliers achieve their sustainability goals. By driving global change, we are ultimately creating an environment for healthy people, healthy places and a healthy planet.”
JCI said it is also helping meet the growing demand for energy-efficient technologies. It said it has provided heat pump solutions for customers at more than a dozen district heating and cooling applications in Denmark, Finland, France, Germany, Italy and Norway.
Heat pumps, it said, have an important role to play in decarbonizing buildings and industry. They have long been in the DNA of industrial refrigeration – utilised in food and beverage, dairy and other process industries for reclaiming low-temperature waste heat and turning it into low-cost, high-temperature heat.
