The International Energy Agency (IEA) released its World Energy Outlook 2021 (WEO-2021) on 13 October 2021. As widely predicted, 2021 saw a large rebound in coil and oil use resulting in the second-largest annual increase in CO2 emissions in history. While financial commitments have been made towards reaching the IEA’s Net Zero Emissions 2050 scenario, public spending on sustainable energy has only mobilized an estimated one-third of the required investment.
The WEO-2021 highlights four key measures that can close the gap between current pledges and those required to meet the targeted trajectory over the next ten years and post-2030. These include:
- Clean Electrification – This is predicted to require doubling solar and wind deployment compared to already announced projects, expanding into other low-emission electricity generation systems including nuclear where acceptable, building-out electricity infrastructure, phasing out of coal, and expanding electricity use for transport and heating.
- Energy Efficiency – This includes measures to temper energy service demands through materials efficiency and behavioural change. The IEA estimate 80% of any additional energy efficiency gains would result in cost savings to consumers.
- Cutting Methane Emissions – Rapid reductions in methane emissions are seen as a key opportunity, particularly in oil and gas operations, to reduce environmental impacts.
- Clean Energy Innovation – While technologies needed to achieve the significant emissions cuts targeted for 2030 are available, those required for the further 2050 target are at the demonstration or prototype stage. Current commitments fall short for deployed hydrogen-based and other low-carbon fuels, as well as CCUS. Significant investment is needed to boost innovation in these areas.
The timing of the report, weeks before COP26 in Glasgow, is not a coincidence as the IEA is calling on participants of the conference to signal an intention to realise the agenda laid out in WEO-2021. While closing the gap to meet the targeted trajectory is estimated to require a surge in annual investment in clean energy projects and infrastructure to nearly USD 4 trillion by 2030; the stated measures: driving clean electrification, improving energy efficiency, reducing methane emissions, and turbocharging clean innovation represent a market opportunity. Companies with innovative technologies in these sectors are well positioned to maximize the potential of this opportunity.
Protecting innovations in all markets accordingly forms an important part of a company’s business strategy. The IP professionals in the Energy team at Marks & Clerk have experience across global energy markets including in the oil and gas sector, as well as experience working with solar, wind turbine, hydrogen and CUUS technologies. The team works with clients to advise on technology protection and IP strategy, including commercialisation, licensing, enforcement, portfolio management, and due diligence. For further information please contact the author, Tomas Karger.
