Net Zero
Roadmap

A Global Pathway to
Keep the 1.5 °C Goal
in Reach
2023 Update

INTERNATIONAL ENERGYAGENCYThe IEA examines thefull spectrumof energy issues
including oil, gas
and coal supply anddemand, renewableenergy technologies,
electricity markets,energy efficiency,
access to energy,
demand side
management andmuch more. Throughits work, the IEA
advocates policies
that will enhance thereliability, affordability
and sustainability ofenergy in its
31 member countries,
13 association
countries andbeyond.

Please note that thispublication is subject tospecific restrictions that limit
its use and distribution. The
terms and conditions areavailable online atwww.iea.org/t&c/
This publication and any
map included herein arewithout prejudice to thestatus of or sovereignty
over any territory, to thedelimitation of international
frontiers and boundaries andto the name of any territory,
city or area.

Source: IEA.
International Energy Agency
Website: www.iea.org

IEA member
countries:

IEA association
countries:

Australia
Austria
Belgium
CanadaCzech Republic
Denmark
Estonia
FinlandFranceGermany
GreeceHungary
Ireland
Italy
Japan
Korea
Lithuania
Luxembourg
MexicoNetherlands
New Zealand
NorwayPolandPortugal
Slovak Republic
Spain
SwedenSwitzerland
Republic of Türkiye
United Kingdom
United States

Argentina
Brazil
China
Egypt
India
Indonesia
Kenya
MoroccoSenegalSingapore
South Africa
ThailandUkraine

The European
Commission also
participates in thework of the IEA

Foreword
The publication of the first Net Zero Roadmap by the International Energy Agency (IEA) in
May 2021 was a landmark moment for the energy and climate world, setting out what would
need to happen in the global energy sector in the years and decades ahead to limit global
warming to 1.5 °C. The interest in the report was huge. The world finally had an authoritative
benchmark for what a clear pathway to net zero energy sector CO2 emissions by 2050 would
look like – something against which the proliferation of net zero pledges could be compared.
The significance of the report was reflected by the massive number of readers it attracted
online. It quickly became our most viewed and downloaded publication ever, a sign of thestrong demand for clear and unbiased analysis, translating the temperature goals of the Paris
Agreement into practical milestones for the global energy sector. Our Roadmap became areference point for governments, companies, investors and civil society, helping informdiscussions and decision-making on pursuing secure, inclusive and affordable transitions toclean energy.
Much has happened since its launch two and half years ago: first, the strong and carbonintensive economic recovery from the Covid crisis; then, the global energy crisis triggered by
Russia’s invasion of Ukraine. The negative consequences of these major events include therise of global energy-related carbon dioxide emissions to a new record in 2022 and increased
investment in new fossil fuel projects.
However, we have also seen some extremely positive developments, most notably the rapid
progress of key clean energy technologies, such as solar PV and electric vehicles, backed bysignificant policy efforts to advance them further. Recognising the importance of theseindustries of the future for energy security and economic competitiveness, countries aroundthe world are seeking to boost their clean technology manufacturing capacities, driving aresurgence in industrial policy. Innovation is also accelerating, strengthening the pipeline oftechnologies that will be needed to complete the world’s journey to net zero.

With this in mind, the IEA is therefore providing a 2023 update to our Net Zero Roadmap,
drawing on the latest data and analysis to map out what the global energy sector would needto do, especially in the crucial period between now and 2030, to play its part in keeping the
1.5 °C goal in reach. The findings are clear: while the global pathway to net zero by 2050 we
mapped out previously has narrowed, it is still achievable. It is too soon to give up on 1.5 °C.
And I would like to underscore that net zero by 2050 globally doesn’t mean net zero by 2050
for every country. In our pathway, advanced economies reach net zero sooner to allow
emerging and developing economies more time.
Foreword

3

IEA. CC BY 4.0.

At the same time, the case for climate action is stronger than ever. July 2023 was the hottest
month on record – and 2023 as a whole appears likely to become the hottest year. Severe
wildfires, droughts, floods and storms further underlined that the climate crisis is with us andthat the costs are mounting. Politically, this year is an important test for the Paris Agreement,with the first Global Stocktake at the COP28 Climate Conference providing a comprehensive
assessment of where things stand five years on. To succeed, it needs to set a course for all
countries to step up to meet the challenge.

Among the wealth of insights contained in this report, I would like to highlight one message
in particular: in an era of international tensions, governments need to separate climate fromgeopolitics. Meeting the shared goal of preventing global warming from going beyond criticalthresholds requires stronger cooperation not fragmentation. Climate change is indifferent togeopolitical rivalries and national boundaries – in its causes and its effects. What matters isemissions, regardless of which country produces them, calling for leadership on collaborative
efforts to tackle them. As this Roadmap makes clear, we have the proven technologies andpolicies to reduce those emissions quickly enough this decade to keep 1.5 °C in reach. All
countries need to work together to make that happen or we all lose in the end.
I hope the insights this report offers will inform international discussions going into COP28
and beyond. For the rigorous and incisive analysis it contains, I’d like to thank my colleagues
who led the work, Laura Cozzi and Timur Gül, and their excellent teams.

4International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Dr Fatih Birol
Executive Director
International Energy Agency

Acknowledgements
This International Energy Agency report was designed and directed by Laura Cozzi, Director
for Sustainability, Technology and Outlooks, and Timur Gül, Chief Energy Technology Officer.
The lead authors and co‐ordinators of the analysis were Araceli Fernández andThomas Spencer. Analytical teams were led by Stéphanie Bouckaert (demand),Christophe McGlade (fossil fuels supply), Uwe Remme (hydrogen and alternative fuels
supply) and Brent Wanner (power). Davide D’Ambrosio was also part of the core team.
The other main authors and modellers were:
Caleigh Andrews (employment), Oskaras Alšauskas (transport), Yasmine Arsalane (leadon economic outlook, power), Heymi Bahar (renewables), Praveen Bains (bioenergy),
Simon Bennett (hydrogen, innovation), Jose Bermúdez Menéndez (lead on hydrogen),Sara Budinis (carbon capture, utilisation and storage), Eric Buisson (critical minerals),
Olivia Chen (co-lead on buildings, equity), Leonardo Collina (industry), Elizabeth Connelly(co-lead on transport, electrification), Daniel Crow (lead on climate modelling, behaviour),
Amrita Dasgupta (critical minerals), Tomás de Oliverira Bredariol (fossil fuels, methane),
Chiara Delmastro (co-lead on buildings), Stavroula Evangelopoulou (hydrogen),Mathilde Fajardy (carbon capture, utilisation and storage), Víctor García Tapia (buildings),
Alexandre Gouy (industry, critical minerals), Will Hall (low-emissions standards),
Paul Hugues (co-lead on industry), Jérôme Hilaire (lead fossil fuel modelling),
Mathilde Huismans (transport), Bruno Idini (employment), Hyeji Kim (transport),
Tae‑Yoon Kim (critical minerals, energy security), Martin Kueppers (industry, decomposition
analysis), Jean-Baptiste Le Marois (innovation), Peter Levi (co-lead on industry, clean energy
technology), Luca Lo Re (Nationally Determined Contributions and pledges),
Shane McDonagh (transport), Rafael Martinez Gordon (buildings), Yannick Monschauer(energy efficiency, affordability), Faidon Papadimoulis (decomposition analysis), Francesco
Pavan (hydrogen), Diana Perez Sanchez (industry), Apostolos Petropoulos (co-lead ontransport), Amalia Pizarro (hydrogen), Ryszard Pospiech (fossil fuel modelling, data
management), Arthur Rogé (data science), Gabriel Saive (Nationally Determined
Contributions and pledges), Richard Simon (clean energy technology, industry), Leonie Staas(buildings, behaviour), Cecilia Tam (finance), Jacob Teter (transport), Tiffany Vass (clean
energy technology, industry), Anthony Vautrin (buildings), Daniel Wetzel (lead on
employment) and Wonjik Yang (data visualisation).
Marina Dos Santos and Eleni Tsoukala provided essential support.
Edmund Hosker carried editorial responsibility. Trevor Morgan provided writing support.
Debra Justus was the copy-editor.

Acknowledgements

5

IEA. CC BY 4.0.

Other key contributors from across the IEA were: France d’Agrain, Tanguy de Bienassis,
Clara Camarasa, Laurence Cret, Carl Greenfield, Alexandra Hegarty, Teo Lombardo,
Jeremy Moorhouse, Alana Rawlins Bilbao, Melanie Slade and Fabian Voswinkel.

Valuable comments and feedback were provided by Tim Gould (Chief Energy Economist),other IEA senior management and numerous other colleagues, in particular Mary Warlick,
Keisuke Sadamori, Dan Dorner, Nick Johnstone, Toril Bosoni, Paolo Frankl, Dennis Hesseling,
Brian Motherway, Alessandro Blasi, Hiro Sakaguchi and Pablo Hevia-Koch.
Thanks go to the IEA Communications and Digital Office for their help to produce the report
and website materials, particularly Jethro Mullen, Poeli Bojorquez, Curtis Brainard,
Hortense De Roffignac, Astrid Dumond, Merve Erdil, Grace Gordon, Julia Horowitz,
Oliver Joy, Robert Stone, Julie Puech, Clara Vallois, Lucile Wall and Therese Walsh. The IEA
Office of the Legal Counsel, Office of Management and Administration and Energy Data
Centre provided assistance throughout the preparation of the report.
Valuable input to the analysis was provided by: David Wilkinson (independent consultant).
Support for the modelling of air pollution and associated health impacts was provided byPeter Rafaj, Gregor Kiesewetter, Laura Warnecke, Katrin Kaltenegger, Jessica Slater,
Chris Heyes, Wolfgang Schöpp, Fabian Wagner and Zbigniew Klimont (International Institutefor Applied Systems Analysis). Valuable input to the modelling and analysis of greenhousegas emissions from land use, agriculture and bioenergy production was provided by
Nicklas Forsell, Zuelclady Araujo Gutierrez, Andrey Lessa-Derci-Augustynczik, Stefan Frank,
Pekka Lauri, Mykola Gusti and Petr Havlík (International Institute for Applied Systems
Analysis). Advice related to the modelling of global climate impacts was provided by
Jared Lewis, Zebedee Nicholls (Climate Resource) and Malte Meinshausen (Climate Resourceand University of Melbourne).

6International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

This work was supported by the Clean Energy Transitions Programme, the IEA’s flagshipinitiative to transform the world’s energy system to achieve a secure and sustainable
future for all.

Peer reviewers

Doug Arent

National Renewable Energy Laboratory, United States

Florian Ausfelder

Dechema

Adam Baylin-Stern

Carbon Engineering

Christoph Beuttler

Climeworks

Sama Bilbao Y Leon

World Nuclear Association

Diane Cameron

Nuclear Energy Agency

Rebecca Collyer

European Climate Foundation

Delphine Eyraud

Permanent Representation of France to the OECD

Nicklas Forsell

International Institute for Applied Systems Analysis

Hiroyuki Fukui

ToyotaOliver Geden

German Institute for International and Security Affairs

Bernd Hackmann

United Nations Climate Change

Ryo Hamaguchi

United Nations Climate Change

Yuya Hasegawa

Ministry of Economy, Trade and Industry, Japan

Harald Hirschhofer

TCX FundRonan Hodge

Glasgow Financial Alliance for Net Zero

Christina Hood

Compass Climate

Dave Jones

EMBER

Vijayalaxmi Jumnoodoo

United Nations Climate Change

Ken Koyama

Institute of Energy Economics, Japan

Francisco Laveron

Iberdrola

Emilio Lèbre La Rovere

Universidade Federal do Rio de Janeiro

Joyce Lee

Global Wind Energy Council

Ritu Mathur

NITI Aayog, Government of India

Malte Meinhausen

University of Melbourne, Australia

Vincent Minier

Schneider Electric

Steve Nadel

American Council for an Energy‐Efficient Economy,
United States

Yasuko Nishimura

Ministry of Foreign Affairs of Japan

Thomas Nowak

European Heat Pump Association

Henri Paillere

International Atomic Energy Agency

Glen Peters

CICERO

Stephanie Pfeifer

Institutional Investors Group on Climate Change

Acknowledgements

7

IEA. CC BY 4.0.

Many senior government officials and international experts provided input and reviewed
preliminary drafts of the report. Their comments and suggestions were of great value. They
include:Cédric Philibert

French Institute of International Relations, Centre for Energy &ClimateVicky Pollard

Directorate-General for Climate Action, European Commission

Andrew Purvis

World Steel Association

Anshari Rahman

GenZeroJulia Reinaud

Breakthrough Energy

Toshiyuki Sakamoto

Institute of Energy Economics, Japan

Vivian Scott

UK Climate Change Committee

Stephan Singer

Climate Action Network International

Jim Skea

Imperial College London, Chair, Intergovernmental Panel on
Climate Change

Sandro Starita

European Aluminium Association

Wim Thomas

Independent consultant

Fridtjof Fossum Unander

Aker Horizons

Noé Van Hulst

International Partnership for Hydrogen and Fuel Cells in the
EconomyMarkus Wråke

Swedish Energy Research Centre

The work reflects the views of the International Energy Agency Secretariat, but does notnecessarily reflect those of individual IEA member countries or of any particular funder,
supporter or collaborator. None of the IEA or any funder, supporter or collaborator that
contributed to this work makes any representation or warranty, express or implied, inrespect of the work’s contents (including its completeness or accuracy) and shall not be
responsible for any use of, or reliance on, the work.
This document and any map included herein are without prejudice to the status of orsovereignty over any territory, to the delimitation of international frontiers and boundaries
and to the name of any territory, city or area.
Comments and questions are welcome and should be addressed to:Laura Cozzi and Timur Gül
Directorate of Sustainability, Technology and Outlooks
International Energy Agency
9, rue de la Fédération
75739 Paris Cedex 15
FranceE-mail: ieanze2050@iea.org

8International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

www.iea.org

Table of Contents
Foreword ................................................................................................................................. 3
Acknowledgements ................................................................................................................. 5
Executive summary ............................................................................................................... 13
1

Progress in the clean energy transition

19

1.1 The context .................................................................................................... 20
1.2 Bending the emissions curve ......................................................................... 23
1.3 Nationally Determined Contributions and Net Zero Emissions Pledges ....... 31
1.3.1 Nationally Determined Contributions ............................................... 31
1.3.2 Net zero emissions pledges ............................................................... 32
1.4 Clean energy technologies ............................................................................ 35
1.4.1 Deployment ....................................................................................... 35
1.4.2 Supply chains ..................................................................................... 41
1.4.3 Costs and performance...................................................................... 48
1.4.4 Innovation.......................................................................................... 50
2

A renewed pathway to net zero emissions

55

2.1 Overview of the NZE Scenario ....................................................................... 56
2.1.1 Scenario design .................................................................................. 56
2.1.2 Emissions and temperature trends ................................................... 62
2.1.3 Key mitigation levers ......................................................................... 66
2.2 Energy trends ................................................................................................ 72
2.2.1 Total energy supply ........................................................................... 72
2.2.2 Fuel supply ......................................................................................... 75
2.2.3 Electricity generation......................................................................... 79
2.2.4 Final energy consumption ................................................................. 84
2.3 Net zero emissions guide............................................................................... 90
Low-emissions sources of electricity ............................................................. 91
Unabated fossil fuels in electricity generation .............................................. 92
Road transport............................................................................................... 93
Shipping and aviation .................................................................................... 94
Steel and aluminium ...................................................................................... 95
Primary chemicals ......................................................................................... 97
Table of Contents

9

IEA. CC BY 4.0.

Cement .......................................................................................................... 96

Space heating ................................................................................................ 98
Space cooling ................................................................................................. 99
Energy efficiency and behavioural change .................................................. 100
Hydrogen ..................................................................................................... 101
Carbon capture, utilisation and storage ...................................................... 102
Bioenergy..................................................................................................... 103
Energy access and air pollution ................................................................... 104
Fossil fuel supply ......................................................................................... 105
3Making the NZE Scenario a reality

107

3.1 Achieving deep emissions reductions by 2030 ............................................ 108
3.1.1 Triple renewables capacity .............................................................. 108
3.1.2 Double the rate of energy intensity improvements ........................ 116
3.1.3 Accelerate electrification ................................................................. 124
3.1.4 Reduce methane emissions ............................................................. 129
3.2 Accelerate long lead time options ............................................................... 132
3.2.1 Carbon capture, utilisation and storage .......................................... 132
3.2.2 Hydrogen and hydrogen-based fuels............................................... 136
3.2.3 Bioenergy ......................................................................................... 141
3.2.4 Infrastructure................................................................................... 146
3.3 Consequences of further delays for the clean energy transition ................ 149
3.3.1 The world has already delayed too long to avoid hard choices....... 150
3.3.2 Implications of not raising climate ambitions to 2030 .................... 151
3.3.3 What would it take to bring temperatures back below 1.5 °C? ...... 152
3.3.4 Implications for the oil and natural gas industry ............................. 156
4

Secure, equitable and co-operative transitions

157

4.1 Introduction................................................................................................. 158
4.2 Energy security ............................................................................................ 158
4.2.1 Bridging the gap between critical mineral supply and demand ...... 158
4.2.2 Scaling up clean energy technologies and scaling back fossil fuels
need to be well synchronised .......................................................... 162

10International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

4.2.3 Fossil fuel markets shrink, but vigilance is still needed ................... 163

4.3 Equity........................................................................................................... 165
4.3.1 Accelerating clean energy deployment in emerging market anddeveloping economies ..................................................................... 165
4.3.2 Enhancing clean energy affordability .............................................. 169
4.3.3 Managing the employment transition ............................................. 172
4.4 International co-operation .......................................................................... 173
4.4.1 Addressing financing barriers in emerging economies .................... 173
4.4.2 Enhancing ambitions through the United Nations Framework
Convention on Climate Change and Global Stocktake .................... 179
4.4.3 Accelerating clean energy technology deployment ........................ 181

Annexes
Annex A. Tables for scenario projections ............................................................................ 191
Annex B. Definitions ............................................................................................................ 201

Table of Contents

11

IEA. CC BY 4.0.

Annex C. References ........................................................................................................... 217

Executive Summary
In 2021, the IEA published its landmark report, Net Zero by 2050: A Roadmap for the Global
Energy Sector. Since then, the energy sector has seen major shifts. Based on the latest dataon technologies, markets and policies, this report presents an updated version of the Net Zero
Emissions by 2050 (NZE) Scenario; a pathway, but not the only one, for the energy sector toachieve net zero CO2 emissions by 2050 and play its part, as the largest source of greenhousegas emissions, in achieving the 1.5 °C goal.

The path to 1.5 °C has narrowed, but clean energy growth is keeping it open
The case for transforming the global energy system in line with the 1.5 °C goal has neverbeen stronger. August 2023 was the hottest on record by a large margin, and the hottest
month ever after July 2023. The impacts of climate change are increasingly frequent andsevere, and scientific warnings about the dangers of the current pathway have become
stronger than ever.
Global carbon dioxide (CO2) emissions from the energy sector reached a new record highof 37 billion tonnes (Gt) in 2022, 1% above their pre-pandemic level, but are set to peakthis decade. The speed of the roll-out of key clean energy technologies means that the IEA
now projects that demand for coal, oil and natural gas will all peak this decade even without
any new climate policies. This is encouraging, but not nearly enough for the 1.5 °C goal.
Positive developments over the past two years include solar PV installations and electric
car sales tracking in line with the milestones set out for them in our 2021 Net Zero by 2050
report. In response to the pandemic and the global energy crisis triggered by Russia’s
invasion of Ukraine, governments around the world announced a raft of measures designed
to promote the uptake of a range of clean energy technologies. Industry is ramping up quickly
to supply many of them. If fully implemented, currently announced manufacturing capacity
expansions for solar PV and batteries would be sufficient to meet demand by 2030 in thisupdate of the NZE Scenario.

We have the tools needed to go much faster

Executive Summary

13

IEA. CC BY 4.0.

Ramping up renewables, improving energy efficiency, cutting methane emissions andincreasing electrification with technologies available today deliver more than 80% of theemissions reductions needed by 2030. The key actions required to bend the emissions curve
sharply downwards by 2030 are well understood, most often cost effective and are taking
place at an accelerating rate. The scaling up of clean energy is the main factor behind a
decline of fossil fuel demand of over 25% this decade in the NZE Scenario. But well-designed
policies, such as the early retirement or repurposing of coal-fired power plants, are key tofacilitate declines in fossil fuel demand and create additional room for clean energy to
expand. In the NZE Scenario, strong growth in clean energy and other policy measures
together lead to energy sector CO2 emissions falling by 35% by 2030 compared to 2022.

Renewables and efficiency are key to drive fossil fuel demand down
Tripling global installed renewables capacity to 11 000 gigawatts by 2030 provides thelargest emissions reductions to 2030 in the NZE Scenario. Renewable electricity sources, inparticular solar PV and wind, are widely available, well understood, and often rapidly
deployable and cost effective. Current policy settings already put advanced economies andChina on track to achieve 85% of their contribution to this global goal, but stronger policies
and international support are required in other emerging market and developing economies.
For all countries, speeding up permitting, extending and modernising electricity grids,
addressing supply chain bottlenecks, and securely integrating variable renewables are
critical.
Doubling the annual rate of energy intensity improvement by 2030 in the NZE Scenario
saves the energy equivalent of all oil consumption in road transport today, reduces
emissions, boosts energy security and improves affordability. Although the mix of priorities
will differ by country, at the global level energy intensity improvements stem from threeequally important actions: improving the technical efficiency of equipment such as electricmotors and air conditioners; switching to more efficient fuels, in particular electricity, andclean cooking solutions in low-income countries; and using energy and materials more
efficiently.
These two actions reduce fossil fuel demand, enabling continued adherence to a key
milestone of our 2021 report: an immediate end to new approvals of unabated coal plants.

Accelerating electrification and cutting methane are also essential

Cutting methane emissions from the energy sector by 75% by 2030 is one of the least cost
opportunities to limit global warming in the near term. Strong reductions in both energy
sector CO2 and methane emissions are essential to meeting the 1.5 °C goal. Without efforts
to reduce methane emissions from fossil fuel supply, global energy sector CO2 emissions
would need to reach net zero by around 2045, with important implications for equitable
pathways. Reducing methane emissions from oil and natural gas operations by 75% costs
around USD 75 billion in cumulative spending to 2030, equivalent to just 2% of the net
income received by the oil and gas industry in 2022. Much of this would be accompanied by
net cost savings through the sale of captured methane.

14International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Booming technologies like electric vehicles and heat pumps drive electrification across theenergy system, providing nearly one-fifth of the emissions reductions to 2030 in the NZE
Scenario. Recent growth puts electric car sales on track to account for two-thirds of new car
sales by 2030 – a critical milestone in the NZE Scenario. Announced production targets fromcar makers underscore that this high share is achievable. Heat pump sales increased by 11%
globally in 2022, and many markets, notably in the European Union, are already tracking
ahead of the roughly 20% annual growth rate needed to 2030 in the NZE Scenario. China
remains the world’s largest market for heat pumps.

Innovation is already delivering new tools and lowering their cost
In the 2021 NZE Scenario, technologies not available on the market at the time delivered
nearly half of the emissions reductions needed in 2050 to reach net zero; that number has
fallen to around 35% in this update. Progress has been rapid: for example, the firstcommercialisation of sodium-ion batteries was announced for 2023, and commercial-scaledemonstrations of solid oxide hydrogen electrolysers are now underway.

But we still need to do much more, notably on infrastructure
Today much of the momentum is in small, modular clean energy technologies like solar PV
and batteries, but these alone are not sufficient to deliver net zero emissions. It will also
require: large new, smarter and repurposed infrastructure networks; large quantities of lowemissions fuels; technologies to capture CO2 from smokestacks and the atmosphere; more
nuclear power; and large land areas for renewables.
Electricity transmission and distribution grids need to expand by around 2 million
kilometres each year to 2030 to meet the needs of the NZE Scenario. Building grids today
can take more than a decade, with permitting a particularly time-consuming bottleneck. The
same is true for other kinds of energy infrastructure. Policy makers, industry and civil society
need to work together to nurture a “build big” mentality and to expedite decision making,while preserving public engagement and respecting environmental safeguards.
Carbon capture, utilisation and storage (CCUS), hydrogen and hydrogen-based fuels, andsustainable bioenergy are critical to achieve net zero emissions; rapid progress is neededby 2030. The history of CCUS has largely been one of underperformance. Although the recent
surge of announced projects for CCUS and hydrogen is encouraging, the majority have yet toreach final investment decision and need further policy support to boost demand andfacilitate new enabling infrastructure.

Increasing clean energy investment in developing countries is vital

Executive Summary

15

IEA. CC BY 4.0.

The world is set to invest a record USD 1.8 trillion in clean energy in 2023: this needs toclimb to around USD 4.5 trillion a year by the early 2030s to be in line with our pathway.
Clean energy investment is paid back over time through lower fuel bills. By 2050, energy
sector investment and fuel bills are lower than today as a share of global GDP. The sharpest
jump in clean energy investment is needed in emerging market and developing economies
other than China, where it surges sevenfold by the early 2030s in the NZE Scenario. This will
require stronger domestic policies together with enhanced and more effective international
support. Annual concessional funding for clean energy in emerging market and developing
economies will need to reach around USD 80-100 billion by the early 2030s.

As clean energy expands and fossil fuel demand declines in the NZE Scenario,
there is no need for investment in new coal, oil and natural gas
Stringent and effective policies in the NZE Scenario spur clean energy deployment and cut
fossil fuel demand by more than 25% by 2030 and 80% in 2050. Coal demand falls fromaround 5 800 million tonnes of coal equivalent (Mtce) in 2022 to 3 250 Mtce by 2030 andaround 500 Mtce by 2050. Oil declines from around 100 million barrels per day (mb/d) to77 mb/d by 2030 and 24 mb/d by 2050. Natural gas demand drops from 4 150 billion cubic
metres (bcm) in 2022 to 3 400 bcm in 2030 and 900 bcm in 2050.
No new long-lead time upstream oil and gas projects are needed in the NZE Scenario,
neither are new coal mines, mine extensions or new unabated coal plants. Nonetheless,continued investment is required in existing oil and gas assets and already approved projects.
Sequencing the decline of fossil fuel supply investment and the increase in clean energy
investment is vital if damaging price spikes or supply gluts are to be avoided.
The drop in fossil fuel demand and supply reduces traditional risks to energy security, butthey do not disappear – especially in a complex and low trust geopolitical environment. In
the NZE Scenario, higher cost producers are squeezed out of a declining market and supply
starts to concentrate in large resource-holders whose economies are most vulnerable to theprocess of change. But attempts by governments to prioritise domestic production must
recognise the risk of locking in emissions that could push the world over the 1.5 °C threshold;and that, if the world is successful in bringing down fossil demand quickly enough to reachnet zero emissions by 2050, new projects would face major commercial risks.

The net zero emissions transition must be secure and affordable
Particular attention needs to be paid to bridging the looming supply and demand gap for
critical minerals. Announced mining projects for minerals such as nickel and lithium fall shortof booming demand in the NZE Scenario in 2030. New projects, innovative extraction
techniques, more recycling and material-efficient design can help to bridge this gap.

As electricity becomes the “new oil” of the global energy system in the NZE Scenario,
secure electricity supplies become even more important. The hugely increased need forelectricity system flexibility requires massive growth of battery energy storage and demand
response; expanded, modernised and cybersecure transmission and distribution grids, andmore dispatchable low-emissions capacity, including fossil fuel capacity with CCUS,
hydropower, biomass, nuclear, and hydrogen and ammonia-based plants.
16

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Extraordinary advances in clean energy technology supply chains have kept the door to net
zero emissions open, but have been accompanied by a high degree of geographicalconcentration. The mining and refining of critical minerals are similarly highly concentrated.
This presents an increased risk of disruption, such as from geopolitical tensions, extreme
weather events or a simple industrial accident. While more diverse and resilient supply
chains are highly desirable, the pace at which clean energy must be scaled up will be evenharder to achieve without open supply chains.

By 2030 in the NZE Scenario, total household energy expenditure in emerging market anddeveloping economies decreases by 12% from today’s level, and even more in advanced
economies. The decrease reflects large energy and cost savings from energy efficiency andelectrification. However, policy makers need to support households, particularly low-income
ones, to meet the often higher upfront costs of clean energy technologies.

There is no low international co-operation route to limit warming to 1.5 °C
and no slow route either
By 2035, emissions need to decline by 80% in advanced economies and 60% in emerging
market and developing economies compared to the 2022 level. Current Nationally
Determined Contributions are not in line with countries’ own net zero emissions pledges,
and those pledges are not sufficient to put the world on a pathway to net zero emissions by
2050. COP28 and the first Global Stocktake under the Paris Agreement provide a key
opportunity to enhance ambition and implementation.
As part of an equitable pathway to the global goal of net zero emissions by 2050, almost
all countries need to bring forward their targeted net zero dates. In the NZE Scenario,
advanced economies take the lead and reach net zero emissions by around 2045 inaggregate; China achieves net zero emissions around 2050; and other emerging market anddeveloping economies do so only well after 2050. The NZE Scenario is a global but
differentiated pathway: each country will follow its own route based on its resources andcircumstances. However, all must act much more strongly than they are today. The net zero
pathway achieves full access to modern forms of energy for all by 2030 through annual
investment of nearly USD 45 billion per year — just over 1% of energy sector investment.
Our Delayed Action Case shows that failure to increase ambition to 2030 would create
additional climate risks and make achieving the 1.5 °C goal dependant on the massive
deployment of carbon removal technologies which are expensive and unproven at scale.
Nearly 5 Gt CO2 would have to be removed from the atmosphere every year during thesecond half of this century. If carbon removal technologies fail to deliver at such scale,returning the temperature to 1.5 °C would not be possible. Removing carbon from theatmosphere is costly and uncertain. We must do everything possible to stop putting it there
in the first place.

The energy sector is changing faster than many people think, but much more needs to bedone and time is short. Momentum is coming not just from the push to meet climate targets
but also from the increasingly strong economic case for clean energy, energy security
imperatives, and the jobs and industrial opportunities that accompany the new energy
economy. Yet, momentum must be accelerated to be in line with the 1.5 °C goal and toensure that the process of change works for everyone. Above all, this needs to be a unified
effort in which governments put tensions aside and find ways to work together on what isthe defining challenge of our time. All of us, and in particular future generations, willremember with gratitude those who act upon the urgency of now.
Executive Summary

17

IEA. CC BY 4.0.

The fierce urgency of now

Chapter 1
Progress in the clean energy transition
Bending the curve
S U M M A R Y• The IEA’s landmark report Net Zero by 2050: A Roadmap for the Global Energy Sector
was published in 2021. It translates the goal of limiting global warming to 1.5 degrees
Celsius (°C) into a concrete roadmap for the global energy sector. In the two years
since then, the energy sector has undergone major shifts.

• Energy sector CO2 emissions remain worryingly high, reaching a new record of
37 gigatonnes (Gt) in 2022. Instead of starting to fall as envisaged in the 2021 report,
demand for fossil fuels has increased – spurred by the energy crisis of 2022 after
Russia’s invasion of Ukraine – and so have investments in supply. Progress on energy
access has stalled while millions of people still lack access to electricity and clean
cooking, notably in sub-Saharan Africa.

• On a brighter note, clean energy technology adoption surged at an unprecedented
pace over the last two years. Solar PV capacity additions increased by nearly 50%, andcurrently track ahead of the trajectory envisaged in the 2021 version of our Net Zero
Emissions by 2050 Scenario (NZE Scenario). Electric car sales expanded 240% andstationary battery installations by 200% since 2020. We now estimate that global
manufacturing capacities for solar PV and electric vehicle batteries would be sufficient
to meet projected demand in 2030 in the updated NZE Scenario, if announced
projects proceed. This progress reflects cost reductions for key clean energy
technologies – solar PV, wind, heat pumps and batteries – which fell by close to 80%
on a deployment weighted average basis between 2010 and 2022.

• Driven by policies, expanding markets, and falling costs, clean energy technologies are
shifting the outlook for emissions even under current policies. In the Stated Policies
Scenario, emissions are now projected to be 7.5 Gt lower in 2030 than in our 2015
Pre-Paris Baseline Scenario, of which policy driven expansions of solar PV and windaccount for 5 Gt and electric vehicles for nearly 1 Gt. This shift in the outlook meansthat the projected warming of 2.4 °C in 2100 under current policy settings, throughstill worryingly high, is now 1 °C lower than before the Paris Agreement in 2015.
(NDC) under the Paris Agreement. If countries deliver in line with their revised NDCs,
emissions in 2030 will be around 5 Gt lower than under the first round of NDCs. But
more needs to be done to be on course by 2030 to deliver announced longer-term
net zero pledges or our NZE Scenario. Both advanced economies and emerging
market and developing economies need to strengthen ambition. Fair and effective
international co-operation is urgently needed to unlock clean energy investment inemerging market and developing economies other than in China.

Chapter 1 | Progress in the clean energy transition

19

IEA. CC BY 4.0.

• Nearly 90% of countries have updated their first Nationally Determined Contribution

1.1

The context

Net Zero by 2050: A Roadmap for the Global Energy Sector was published in 2021 (IEA,
2021a). It translates the goal of limiting global warming to 1.5 °C into a concrete roadmap
for the global energy sector. It describes a pathway, not the definitive pathway, to the goalof net zero emissions by 2050. It takes into account countries’ varying circumstances andchallenges.
An update of that roadmap is the focus of this report. It is based on recent developments intechnologies, markets, policies and investment, and identifies what governments and otherstakeholders need to do to keep alive the goal of net zero emissions by 2050. The importanceof that goal has been underlined by a number of recent climate-related disasters, with 2023
seeing the hottest July and hottest August ever recorded.

Gt CO₂

Figure 1.1 ⊳Global energy sector CO2 emissions, 2000-2022

40

30

20

10

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

2020

2022

IEA. CC BY 4.0.

Global energy sector emissions have not fallen in the last two years,
as envisaged in our 2021 roadmap, but instead have risen to record levels

1 Unless otherwise specified, energy sector emissions in this report refer to CO emissions from fossil fuel2
combustion, industrial processes, and fugitive and flaring CO2 from fossil fuel extraction.

20

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The energy sector has undergone major shifts in the two years since the release of our 2021
report. Energy sector emissions have remained stubbornly high, reaching a new record of
37 gigatonnes (Gt) of carbon dioxide (CO2) in 2022, 1% above the 2019 level (Figure 1.1). 1
Even with the very strong economic rebound in advanced economies since the Covid-19
pandemic, their emissions in 2022 were around 4% below the pre-pandemic level. By
contrast, in emerging market and developing economies emissions were around 4.5%
(roughly 1 Gt) above the 2019 level. This rise was largely driven by the People's Republic ofChina (hereinafter China), where emissions increased 7% between 2019 and 2022, relative
to a 2% increase in other emerging market and developing economies.

1

Since the publication of the original Net Zero by 2050 report, concerns about energy security
have become more acute, in large part due to the invasion of Ukraine by the RussianFederation (hereinafter Russia) in 2022, which precipitated an unprecedented global energy
crisis. Prices for energy commodities surged to five- to ten-times their historical levels insome instances, adding to the inflationary pressures that had been building in the wake of
the Covid-19 pandemic. The crisis spurred an increase in clean energy deployment andinvestment, but also in investment in fossil fuel supply. Concerns about energy security willremain an important consideration in the development of policy frameworks that shapeinvestment decisions.
Increasing geopolitical fractures have also stoked energy security concerns about the
pronounced concentration in a small number of countries of both mining and processing of
critical minerals and clean energy technology manufacturing. In response, several countries
introduced measures that aim to promote the development of domestic supply chains. Suchmeasures should help to scale up the supply of clean energy technologies but could also put
at risk the benefits of global supply chains. More broadly, increased geopoliticalfragmentation highlights the need for fair and effective international co-operation to achieve
the clean energy transition.
Although fossil fuel demand has not yet started to fall, deployment and investment in someclean energy technology supply chains has risen very rapidly since the 2021 Net Zero by 2050
report. This is partly thanks to stronger policy support in post-Covid-19 economic recovery
packages and partly due to policy responses to the global energy crisis. Recent rates ofgrowth for solar photovoltaics (PV) adoption and electric vehicles (EVs) sales have been
particularly impressive. If all announced projects are realised, manufacturing capacity forsolar PV will exceed the level required in 2030 in our 2021 Net Zero Emissions by 2050 (NZE)
Scenario, and capacity for EV batteries will come very close to requirements. Progress intechnologies such as wind power and carbon capture, utilisation and storage (CCUS) has
been less rapid. Overall, recent progress on clean energy technologies has been encouraging,although much more remains to be done to get the world on track with the roadmap in the
NZE Scenario.

Chapter 1 | Progress in the clean energy transition

21

IEA. CC BY 4.0.

This report is being published in an important year for global climate change diplomacy. The
sixth assessment cycle of the Intergovernmental Panel on Climate Change (IPCC) recently set
out with greater clarity than ever before both the dangers of exceeding the 1.5 °C limit andthe availability and cost effectiveness of a range of emissions reduction options. Alongside
the IPCC scientific stocktaking, a political review of the progress towards internationallyagreed climate goals concludes this year in the form of the first Global Stocktake under theParis Agreement (see Spotlight).

S P O T L I G H TFirst global stocktake under the Paris Agreement
The Global Stocktake (GST) is a process under the Paris Agreement designed to provide
a regular assessment of collective progress towards the long-term goals of theAgreement in order to inform subsequent updates of Nationally Determined
Contributions and enhance international co-operation on climate action. The firststocktake (GST1) started at 26th Conference of the Parties (COP) in 2021 and is expected
to conclude at COP28 in 2023. Countries and other stakeholders have submitted morethan 170 000 pages of input to the GST1. The 1.5 °C goal is a central priority of country
submissions, as is the enhancement of climate finance (Figure 1.2).
Figure 1.2 ⊳Key aspects of energy transition mentioned in
Global Stocktake submissions by region

Climate finance
1.5 °C goal

Just transitions
Renewables
Action on fossil fuels
Technology transfer
Hard-to-abate sectors
Other low-emissions
technology
techn.
Atmospheric removal
20%
AfricaAsia Pacific

C & S America

40%
Europe60%
Eurasia

80%
100%
Percent of submissions

Middle East

North America
IEA. CC BY 4.0.

Note: C & S America = Central and South America; Europe = the geographical region, not the European
Union.

22

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Just transitions, renewables and action on fossil fuels are priority topics in thefirst global stocktake, alongside climate finance and the 1.5 °C goal

The energy sector is a central component of the GST1 country submissions: 96% of the
181 countries included in our analysis indicate that mitigation action in the energy sector
is a priority. Around 65% of countries, representing around 60% of global CO2 emissions,indicate that just transitions, renewables and action on fossil fuels are priority topics forthe energy sector. Other areas such as atmospheric removals are not yet perceived aspriority for the GST1 by all countries.

1

At COP28, the GST1 will move to the final, political phase. How the outcomes of the GST1
process influence the ambition of the next round of NDCs, expected in 2025 ahead of
COP30, will be the acid test of its success.
This report presents an updated NZE Scenario that takes account of an in-depth, sector-bysector assessment of developments since 2021. It enhances the detail of what is needed tomake the NZE Scenario a reality by region and technology. The analysis is presented in fourchapters.


Chapter 1 provides an overview of key developments in the energy sector in recent
years. It takes stock of progress in the energy transition and development of clean
energy technologies.



Chapter 2 presents an updated NZE Scenario. It sets out some of the key differenceswith the 2021 version and provides high level “dashboards” to show how each sector
and technology needs to contribute.

Chapter 3 assesses in more depth how key sectors and technologies can make theprogress assumed in the updated NZE Scenario and looks at the implications of notreaching the ambitious milestones set out for 2030.

Chapter 4 focusses on the critical importance of energy security, equity and enhanced
global co-operation for the pathway set out in the NZE Scenario.

1.2

Bending the emissions curve

Chapter 1 | Progress in the clean energy transition

23

IEA. CC BY 4.0.

Considerable progress has been made in deploying clean energy technologies and lowering
their cost, which is altering the emissions outlook for the energy sector. IEA projections for
global CO2 emissions from the energy sector in the Stated Policies Scenario (STEPS) have been
progressively revised downward compared with our Pre-Paris Baseline Scenario (IEA, 2021b).
The Pre-Paris Baseline Scenario considered government policies in place in 2015 when the
Paris Agreement on climate change was negotiated. On the basis of these policies, it
projected a rise in average global temperature of 3.5 °C by 2100. In the latest version of the
STEPS, the equivalent figure is 2.4 °C. This reflects progress made in the transition to a lower
emissions energy system since 2015, although it still falls far short of what is needed to meet
the temperature goals of the Paris Agreement.

Box 1.1 ⊳IEA scenarios

This report is based on an updated and revised Net Zero Emissions by 2050 Scenario(NZE Scenario), which sets out a pathway for the global energy sector to achieve net zeroCO2 emissions by 2050. (Chapter 2 provides a description of the design of the NZE
Scenario.)
Three other scenarios are employed as benchmarks against which the NZE Scenario iscompared:The Stated Policies Scenario (STEPS) projects energy demand and supply and theirimplications for emissions taking account of established and planned policies andregulations. It incorporates the most recent available data and projections ontechnology costs, manufacturing capacity and the industrial strategies of countries
and companies operating in the energy sector.



The Announced Pledges Scenario (APS) assumes that all climate commitments madeby governments around the world, including all those set out in NDCs and long‐term
net zero emissions pledges, are met in full and on time.



The Pre-Paris Baseline Scenario was produced in 2015. It is based on the policies
that were in place at the time; it does not incorporate additional policy intentions
and targets since then. It corresponds to the Current Policies Scenario set out in the2015 edition of the World Energy Outlook.

Detailed projections and analysis of the updated STEPS and APS will be included in theWorld Energy Outlook 2023, to be released in October.

World
Global energy sector emissions were 37 gigatonnes (Gt) in 2022 – a record high and a 5%
increase from 2015. Nonetheless, progress since the 2015 Paris Agreement means that theoutlook in the STEPS sees emissions peak by the middle of this decade and fall to around
35 Gt by 2030, which is well below the level of around 43 Gt projected in the Pre-Paris
Baseline Scenario (Figure 1.3). To put this in perspective, this 7.5 Gt difference is equal to thecurrent combined energy sector emissions of the United States and European Union.
Three technologies contribute the bulk of the emissions reductions in the STEPS relative to
the Pre-Paris Baseline Scenario: solar PV, wind and EVs. 2 Solar PV is projected to reduce
emissions by around 3 Gt in 2030, roughly equivalent to the emissions from all the world’s
cars on the road today. Wind power reduces emissions by around 2 Gt in 2030 and EVs byaround 1 Gt. 3 The latter reflects replacement of internal combustion engine (ICE) vehicles by

3 The decomposition analysis in this section is based on direct emissions, with indirect emissions allocated tothe electricity sector.

24

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

2 STEPS refers to the 2023 version of the scenario in this report unless otherwise specified.

EVs which are increasingly powered by lower emissions electricity generation sources.
Together numerous other smaller changes across all sectors reduce emissions by a further
1.5 Gt.

Gt CO₂

Figure 1.3 ⊳1Global energy sector CO2 emissions in the Pre-Paris Baseline
Scenario and STEPS, 2015-2030

45
Pre-Paris Baseline
Other
Electric vehicles
Wind

40

Solar PVSTEPS-2023

35

30
2015

2022

2030
IEA. CC BY 4.0.

Solar PV, wind power and EVs reduce emissions by 6 Gt in 2030
in the STEPS relative to the Pre-Paris Baseline Scenario
Note: Other includes all other levers with downward or upward effects on the emissions difference between
the Pre-Paris Baseline Scenario and the 2023 STEPS projections, as detailed in Figures 1.5-1.8.

A significant strengthening of government policies in major economies is at the heart of thisimprovement. For example, successive five-years plans in China have progressively raised
ambitions for solar PV and driven down global costs. Offshore wind deployment in Europe
kick-started a global industry. EV targets, and fuel-economy and CO2 emissions standards inthe European Union and China – and more recently in the United States – have driven a majortransformation in the industrial strategies of car and truck manufacturers. Similarly, electric
two/three-wheelers and buses have seen significant uptake in India and other emerging
market and developing economies thanks to policy support, increasing economic
competitiveness and limited infrastructure needs. The United States, through the Inflation
Reduction Act (IRA) adopted in 2022, has provided unprecedented funding to support
Chapter 1 | Progress in the clean energy transition

25

IEA. CC BY 4.0.

In the Pre-Paris Baseline Scenario, only modest deployment of clean energy technologies wasprojected to 2030, based on the policies in place in 2015 (Figure 1.4). Wind power and solar
PV were projected to account for less than 10% of global electricity generation in 2030, nearlyfour times lower than in the STEPS. EVs are projected to continue recent spectacular growth,
accounting for more than one-third of car sales in 2030 in the STEPS compared with a small
fraction in the Pre-Paris Baseline Scenario.

deployment and reduce costs for a range of low-emissions technologies, notably CCUS andhydrogen. Progress across all sectors in other regions has also helped bend the global
emissions curve. The following sections focus on key developments in selected economies
which together account for over 60% of energy-related emissions today.
Figure 1.4 ⊳20%Wind power and solar PV in electricity generation, and electriccars in car sales, Pre-Paris Baseline Scenario and STEPS, 2030

Solar PV

20%

Wind

40%

15%

15%

30%

10%

10%

20%

5%

5%

10%

Pre-Paris Baseline:

2015

STEPS edition of:

2017

2019

Electric cars

2021

2023
IEA. CC BY 4.0.

Key clean energy technologies by 2030 in the STEPS have increased progressively
since 2015 reflecting stronger policies and technological advances
Notes: Wind and solar PV refer to the share of total electricity generation. Electric cars refer to the share ofpassenger light-duty vehicle sales.

United States

In the transport sector, the projected share of electric cars in total car sales in 2030 increases
from less than 10% in the Pre-Paris Baseline Scenario to 50% in the STEPS. This upwardrevision reflects public charging infrastructure funding under the Infrastructure Investment
and Jobs Act, new eligibility requirements for EV tax credits under the IRA, more stringent
26

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

In the United States, CO2 emissions in 2030 are 1.7 Gt lower in the outlook in the current
STEPS than in the Pre-Paris Baseline Scenario, with solar PV and wind together accounting
for around 0.8 Gt of the reduction (Figure 1.5). A larger switch from coal to natural gas forelectricity generation accounts for around an additional 340 million tonnes (Mt) of CO2
emissions reductions by 2030. The increased renewables projections reflect federal
government subsidies, post Covid-19 recovery spending, carbon-free electricity targets in an
increasing number of states, and large-scale support provided for a range of clean energy
technologies by the IRA. Among others, the IRA includes substantial funding for energy
efficiency measures in the buildings sector, manufacturing of low-emissions technologies
and CCUS projects.

national fuel-economy standards, and more aggressive electrification strategies of car andtruck manufacturers. Increased deployment of EVs accounts for 200 Mt of additional CO2
emission reductions by 2030. However, these reductions are partially offset by an increasein the market share of sports utility vehicles (SUVs), which are less fuel efficient than standard
passenger cars.

Gt CO₂

Figure 1.5 ⊳61Energy sector CO2 emissions in the United States in the Pre-Paris
Baseline Scenario and STEPS, 2030
2030
Pre-Parisbaseline

5
2022
4

3

2030
STEPS

Electricity
Solar PV
Wind
More coal-to-gas switching
Electricity demand
Other electricity
Transport
Electric vehicles
Road activity
Other transport
Other sectors
Buildings
Industry
Other
IEA. CC BY 4.0.

Nearly half of the emissions reductions in 2030 between the Pre-Paris Baseline Scenario andthe 2023 STEPS are due to accelerated deployment of renewables in the power sector
Notes: Other electricity includes nuclear, hydropower, emissions intensity of heat generation and electricity
sector efficiency. Other transport includes changes in the fuel economy of ICE vehicles and the deployment of
biofuels. Buildings and industry refer to direct emissions in these sectors.

European Union and United Kingdom

The buildings sector makes a big contribution to lower emissions, with CO2 emissions 150 Mt
lower in the STEPS than in the pre-Paris Baseline Scenario in 2030 thanks in part to therevised EU Energy Performance of Buildings Directive as well as new and expanded incentives
for energy efficiency retrofits. An accelerated deployment of heat pumps under the
REPowerEU Plan and a range of fossil fuel boiler bans also contribute to a smaller share ofChapter 1 | Progress in the clean energy transition

27

IEA. CC BY 4.0.

In the European Union and United Kingdom, CO2 emissions projections in the STEPS arearound 0.9 Gt lower than in the 2015 Pre-Paris Baseline Scenario (Figure 1.6). Two-thirds ofthe difference in 2030 are due to increased shares of wind and solar PV in electricity
generation, driven by a range of new incentives and targets. A number of coal phase-out
targets introduced in major European countries such as Germany, Italy and the United
Kingdom between 2018 and 2020 also contribute to lower projected emissions in theelectricity sector in the STEPS.

fossil fuels in heating demand in buildings, which is nearly 10 percentage points lower in 2030
in the STEPS than in the Pre-Paris Baseline Scenario.
The transport sector contributes through accelerated deployment of EVs, which reduce
emissions by more than 100 Mt in 2030 compared with the 2015 projections. From a small
fraction of annual cars sales by 2030 in the Pre-Paris Baseline Scenario, the projected shareof electric cars increases to nearly two-in-three new cars in the STEPS, driven by new CO2
standards, forthcoming bans on new ICE vehicles, EV incentives and investment in charging
infrastructure. As in the United States, however, slower improvements in road transport fueleconomy due to increasing SUV sales partially offset this gain.
In industry, strengthening of the European Union Emissions Trading Scheme is projected tolead to larger savings from energy-intensive industries in 2030 than previously projected,
though much of this is outweighed by higher projections for industrial activity.

Gt CO₂

Figure 1.6 ⊳
3.5

3.0

Energy sector CO2 emissions in the European Union and theUnited Kingdom in the Pre-Paris Baseline Scenario and STEPS, 2030
2030
Pre-Parisbaseline

2022

2.5

2.0

1.5

2030
STEPS

Electricity
Solar PV
Wind
More coal-to-gas switching
Electricity demand
Other electricity
Transport
Road EVs
Road activity
Other transport
Other sectors
Buildings
Industry
Other
IEA. CC BY 4.0.

Two-thirds of the emissions reductions in 2030 between the Pre-Paris Baseline Scenario
and the STEPS in Europe are due to accelerated deployment of wind and solar PV
Notes: Other electricity includes nuclear, hydropower, emissions intensity of heat generation and electricity
sector efficiency. Other transport incudes the fuel economy of ICE vehicles and the deployment of biofuels.
Buildings and industry refer to direct emissions in these sectors.

CO2 emissions in China are projected to be around 1.2 Gt lower in 2030 in the STEPS than in
the Pre-Paris Baseline Scenario (Figure 1.7). Solar PV and wind are the main drivers. In the
Pre-Paris Baseline Scenario, wind and solar PV account for slightly less than 10% of total
electricity generation in 2030; in the STEPS they account for more than one-third. This change
28International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Chinareflects more ambitious renewables deployment goals in successive five-year plans and anincrease from 20% to 25% in the updated NDC in the planned share of non-fossil fuel sourcesin primary energy by 2030.

Gt CO₂

Figure 1.7 ⊳Energy sector CO2 emissions in China in the Pre-Paris
Baseline Scenario and STEPS, 2030
Electricity
Solar PV
Wind
Less coal-to-gas switching
Electricity demand
Other electricity

16

14

1

2030
Pre-Parisbaseline

Transport
Electric vehicles
Road activity
Other transport

2022
12
2030
STEPS
10

Other sectors
Buildings
Industry
Other
IEA. CC BY 4.0.

Emissions in China in 2030 in the STEPS are projected to be 1.2 Gt lower than in the Pre-Paris
Baseline Scenario, though rising coal demand partially offsets reductions from renewables
Notes: Other electricity includes nuclear, hydropower, emissions intensity of heat generation and electricity
sector efficiency. Other transport incudes the fuel economy of ICE vehicles and the deployment of biofuels.
Buildings and industry refer to direct emissions in these sectors.

China’s drive to increase electrification in the transport, buildings and industry sectors,
together with strong demand growth in the manufacturing and residential sectors, has led
to rapidly rising electricity demand. Between 2015 and 2022, China’s electricity generation
increased at more than 6% per year, faster than the rate of GDP growth. The massive
expansion of China’s low-emissions electricity generation during this period was not
sufficient to meet demand, leading to an increase in coal-fired power generation. As a result,
Chapter 1 | Progress in the clean energy transition

29

IEA. CC BY 4.0.

EVs are projected to reduce CO2 emissions by around 250 Mt by 2030 in China in the STEPS
relative to the Pre-Paris Baseline Scenario. Electric cars account for a tiny share of total car
sales by 2030 in the Pre-Paris Baseline Scenario, but for two-thirds of all new car sales in the
STEPS. In 2016, the government set a planning target for New Energy Vehicles (largely EVs)
to reach 12% of total vehicle sales in 2020. In 2020, it set a new target of 20% of new vehicle
sales in 2025 supported by large purchase subsidies and tax exemptions. These measures,
together with continued policy support to promote EV manufacturing and high levels of EV
sales in recent years, have led to successive upwards revisions in the STEPS projections of
the EV share in total vehicle sales in 2030.

China’s share in global coal-fired power generation increased by 10 percentage points during
these years. This growth in coal-fired electricity generation moderates the emissions
reductions in the STEPS relative to the Pre-Paris Baseline Scenario by 2030. In the longer
term, however, China’s early electrification of energy consumption will also bring lower CO2
emissions in end-use sectors as power generation continues to decarbonise.

India
Projected CO2 emissions in India in 2030 are 1.3 Gt lower in the STEPS than the Pre-Paris
Baseline Scenario (Figure 1.8). The share of solar PV in power generation increases eightfold,saving nearly 400 Mt of emissions in 2030 in STEPS. In the Pre-Paris Baseline Scenario, windand solar PV account for less than 10% of total generation in 2030; in the STEPS, this rises toaround 25%. A key reason is the adoption in 2021 of a 500 gigawatt (GW) target for nonfossil fuel capacity by 2030. Compared with solar PV, wind power has made less progress,
with projections for capacity deployment by 2030 in the STEPS only slightly larger than
expected in Pre-Paris Baseline Scenario. This reflects a lack of progress in resolving landacquisition and tariff setting issues related to wind power developments.
Energy sector CO2 emissions in India in the Pre-Paris
Baseline Scenario and STEPS, 2030

Gt CO₂

Figure 1.8 ⊳
5

4

3

2

Electricity
Solar PV
Wind
Less coal-to-gas switching
Electricity demand
Other electricity

2030
Pre-Paris baseline

2022

2030
STEPS

Transport
Road EVs
Road activity
Other transport
Other sectors
Buildings
Industry
Other
IEA. CC BY 4.0.

India sees major emissions reductions from solar PV; lower GDP growth in STEPS
as a result of the pandemic also reduces projected emissions

Changes in macroeconomic assumptions account for part of the difference in emissions
between the Pre-Paris Baseline Scenario and the STEPS. India’s GDP took a significant hit in
30

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Notes: other electricity includes nuclear, hydropower, emissions intensity of heat generation and electricity
sector efficiency. Other transport incudes the fuel economy of ICE vehicles and the deployment of biofuels.
Buildings and industry refer to direct emissions in these sectors.

the Covid-19 pandemic, and the subsequent growth projected in the STEPS is not sufficient
to recover lost ground. Therefore, GDP in 2030 is slightly lower in the STEPS than in the
Pre-Paris Baseline Scenario. As a result, industrial production and electricity demand are also
somewhat lower, as are projected emissions in both the industry and electricity sectors.

1.3

1Nationally Determined Contributions and
Net Zero Emissions Pledges

Despite the progress in recent years, national commitments to reduce emissions collectively
fall short of what is required by 2030 to bring global emissions down to a level in line withachieving net zero emissions by 2050. In addition, the various commitments are not yet
underpinned by sufficiently strong and comprehensive policies to give confidence that they
will be successfully delivered. Both advanced economies and emerging market anddeveloping economies need to strengthen their implementation of pledges and to raise theirlevel of ambition, including through the submission of stronger NDCs at the international
level (see Chapter 4).

1.3.1

Nationally Determined Contributions

The Paris Agreement requires all countries to submit Nationally Determined Contributions(NDCs) that set out their climate targets. As of July 2023, 168 NDCs had been submitted,
covering 195 Parties to the United Nations Framework Convention on Climate Change(UNFCCC). 4 Successive Conferences of the Parties (COPs) have encouraged countries to
update their first NDCs to increase their ambition. So far, nearly 90% of NDCs have been
updated since the first submission.
The revisions have led to a significant reduction in targeted emissions in 2030 totallingaround 5 Gt, if all targets conditional on international support are reached (Figure 1.9). 5
According to IEA analysis, advanced economies were projected to emit slightly less than
10 Gt of CO2 emissions from fuel combustion in 2030 under the first round of NDCs; revised
NDCs have lowered this by around 2.1 Gt, or around 20%. Full implementation of NDCs inadvanced economies would still see emissions of around 5.5 tonnes per capita in 2030, about
1 tonne per capita more than the current world average, but about 2 tonnes less than in
China today. In emerging market and developing economies, the picture is somewhat
different. In aggregate, revised NDCs in emerging market and developing economies lowered
emissions compared to their first NDCs by 2.8 Gt, mostly driven by revisions unconditionalon financial support.

4

194 countries and one region, the European Union, whose member states submit a joint NDC.

this section refers to emissions from fuel combustion and excludes industrial process
emissions and international bunkers. It considers that conditional mitigation pledges put forward by somedeveloping economies in their NDCs are fully achieved.

Chapter 1 | Progress in the clean energy transition

31

IEA. CC BY 4.0.

5 The analysis inGt CO₂

Figure 1.9 ⊳12

CO2 emissions from fuel combustion implied by NDCs andin IEA scenarios by region, 2030
Advanced economies

Emerging market and developing economies
30

8

20

4

10

First Revised
NDCs NDCs

STEPS APSNZE

Conditional

First Revised
NDCs NDCs

STEPS APS

NZE

+ Unconditional
IEA. CC BY 4.0.

Revised NDCs boost the reduction in targeted emissions by around 5 Gt CO2 in 2030,
this is far short of what is needed to be on track for net zero emissions by 2050

However, IEA analysis suggests that planned energy policies in emerging market anddeveloping economies are already more ambitious in the aggregate than their NDCs indicate,particularly in the case of conditional NDCs. Their emissions in the STEPS in 2030 are
accordingly lower, by 1 Gt, than under their revised unconditional NDCs. The picture isreversed in advanced economies, where emissions in 2030 are nearly 0.7 Gt higher in the
STEPS than in revised NDCs, implying that the policies currently in place are inadequate tomeet stated NDCs, let alone longer-term net zero emissions pledges.

1.3.2

Net zero emissions pledges

As of September 2023, net zero emissions pledges 6 cover more than 85% of global energyrelated emissions and nearly 90% of global GDP. To date, 94 countries and the European
Union have pledged to meet a net zero emissions target. Some countries have also
communicated their net zero emissions pledges to the UNFCCC in the form of long‑term
low‑emissions strategies. These strategies do not have the same legal force under the Paris
Agreement as NDCs, but they are important as they provide a signal of country ambitions tocontribute to the collective goal of net zero emissions.
Increasing numbers of countries have adopted a net zero emissions target in national law.
Collectively, they currently account for about one-fifth of global energy sector emissions. The

neutrality (CO2 only) objectives. As of August 2023, out of the 88 net zero emissions pledges formulated bycountries, 83% have a target comprising all greenhouse gases and 17% a target on only CO2 emissions.

32

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

6 Net zero emissions pledges and targets here include climate neutrality (all greenhouse gases) and carbon

advanced economies in Asia Pacific and Europe are the leaders in this regard: 100% ofenergy-related emissions are covered by a net zero emissions target in national law inadvanced economies in the Asia Pacific region and about 80% in Europe, including throughthe EU Climate Law (Figure 1.10). 7

1

Figure 1.10 ⊳ Energy-related CO2 emissions covered by a government
net zero emissions pledge by type and by region

Asia Pacific - AE
Developing Asia
Central and South America
EuropeEurasia
MENA
North America
Sub-Saharan Africa
20%
In law

40%
Policy document

60%

80%

Oral pledge

100%
No pledge
IEA. CC BY 4.0.

The bulk of emissions are covered by some form of net zero emissions pledge
in all regions except the Middle East and North Africa
Note: Asia Pacific - AE includes Australia, Korea, Japan and New Zealand; MENA includes the Middle East andNorth Africa country groups.

The majority of emissions in emerging market and developing economies in Central andSouth America, Eurasia, North America and sub-Saharan Africa are covered by net zero
emissions pledges, but mostly in a non-legally binding policy document or in an oral pledge.
In the Middle East and North Africa (MENA), 11 countries out of 17 have yet to adopt a net
zero emissions target: if Egypt, Iran and Algeria adopted such a target, they would collectively
cover almost 90% of CO2 energy-related emissions in the MENA region.

7 This 80% coverage refers to the geographical region of Europe, not just the European Union.

Chapter 1 | Progress in the clean energy transition

33

IEA. CC BY 4.0.

The overwhelming majority of net zero emissions pledges cover all sectors of an economy,
and all cover the energy sector. However, as many countries include the land use, land-use
change and forestry sector in their projections, and account for this as an emissions sink, thepace of emissions reduction in the energy sector is usually slower than in the IEA scenarios.
Setting more transparent net zero emissions targets, for instance by specifying the absolutelevel of emission reductions foreseen by the goal year and, separately, the level of emission
removals, would help bring more clarity and trust to the process.

Countries have varying starting points and levels of responsibility and capabilities.
Consequently, they have adopted various timeframes for their net zero emissions pledges.
In general, advanced economies have put forward net zero emissions pledges with theearliest target years. About 30% of current global energy-related CO2 emissions are coveredby net zero emissions pledges by 2050 or sooner, but the share is close to 95% in thosecountries in the highest decile of global income distribution, e.g. Finland (climate neutral by2035), Iceland and Austria (climate neutral by 2040), and Germany and Sweden (climate
neutral by 2045) (Figure 1.11).
Figure 1.11 ⊳ Energy sector CO2 emissions covered by net zero emissions
100%

100 000

75%

75 00050%

50 00025%

25 0001< 2050

2

3
2050

4
> 20505

6
No target

7

USD (2021, PPP)

targets by net zero year and per capita income group8910Global income decile
GDP per capita (right axis)
IEA. CC BY 4.0.

Ambition of net zero emissions target dates tends to correlate with development levels;
almost all countries would need to bring the date forward to align with the NZE Scenario
Note: GDP = gross domestic product; PPP = purchasing power parity.

34

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The picture is more mixed in other deciles. Some countries in the top 30-40% of the global
income distribution have net zero emissions targets after 2050 or no target at all, such as
Kuwait and Qatar (no target), and Bahrain and Saudi Arabia (climate neutral by 2060). Somecountries moved their target year forward. For instance, in 2021 Germany advanced its
climate neutrality goal from 2050 to 2045 and Brazil from 2060 to 2050. In its updated NDC,
China pledged to peak its emissions before 2030 and to target carbon neutrality by 2060 at
the latest.

1.4

Clean energy technologies

Development and deployment of clean energy technologies have progressed significantly
since the adoption of the Paris Agreement in 2015, boosted recently by stimulus spending
related to the Covid-19 pandemic, the response from governments and investors to theglobal energy crisis, and growing commercial and geopolitical competition for markets andsupply chains.

1.4.1

1

Deployment

Mass manufactured technologies are leading the way
The deployment of many clean energy technologies has accelerated markedly since 2015
(Figure 1.12) (IEA, 2023a). Mass manufactured technologies have seen the fastest growth,benefiting from standardisation and short lead times. For example, between 2015 and 2022:
Solar PV capacity additions increased by more than 400%, with almost 1 terawatt (TW)of capacity added, nearly equivalent to the total installed electricity capacity in theEuropean Union.

Electric car sales increased by nearly 2 000%, with over 25 million sold over the period,
equivalent to more than all the cars on the road in Canada.

Residential heat pump sales increased by 225%, with approximately 600 GW sold,approximately equivalent to the entire residential heating capacity in Russia.



Stationary battery storage capacity additions increased by 2 500%, with nearly 45 GW
installed, approximately equivalent to the total installed electricity capacity inArgentina.

Important and impressive as this progress is, there is much more to be done. The slow paceof the turnover of the stock of most types of energy-related equipment means that there isa considerable lag between a technology becoming dominant in new deployments and thattechnology becoming dominant in the overall operating stock, underlining the urgent needfor continued action to further boost deployment in the near term to be on track to reachnet zero emissions by 2050 (see Chapter 3).

Chapter 1 | Progress in the clean energy transition

35

IEA. CC BY 4.0.

The acceleration in clean technology deployment has been particularly strong in the last two
years. Around one-third of all PV solar deployment to date took place in 2021 and 2022, andthe figures are even higher for some other clean energy technologies: about 60% for bothelectric car sales and for the installation of stationary batteries. Actual installations for solar
PV in 2022 and estimated installations for 2023 track ahead of the level projected in the IEANet Zero by 2050 report in 2021 (IEA, 2021a). Emerging technologies such as electrolysers
for hydrogen production are also moving forward, with total global installed electrolyser
capacity more than doubling in the last two years, reaching nearly 700 megawatts (MW) in
2022. Manufacturing capacity for clean energy technologies is scaling up quickly, suggestingthat deployment will continue to increase strongly in the coming years.

Figure 1.12 ⊳ Global installations of selected clean energy technologies,
2010-2022

Solar PV additions (GW)Electric car sales (million vehicles)

300

12

200

8

100

4

2010

120

2022
Residential heat pumpsales (GW)

2010

24

80

16

40

8

2010

2022

2022
Battery storage additions
(GW)

2010

2022
IEA. CC BY 4.0.

Deployment of a number of key clean technologies has
accelerated significantly since the Paris Agreement in 2015

The rapid growth in clean energy technologies has occurred in parallel with a trend towards
declining deployment of new fossil fuel-based equipment in several areas. Fossil fuel-based
electricity capacity additions peaked in 2012 and declined to less than half their peak levelby 2022, while sales of ICE vehicles peaked in 2017 with a 25% decline from this peak by
2022. As a result, clean energy technologies have expanded in both absolute terms andmarket share.
36

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Moreover, deployment has been uneven across regions, with the strongest progress inregions with supportive policy environments, and strong financial and technical capabilities.
From 2015 to 2022, advanced economies and China together accounted for over 95% of
global electric car and heat pumps sales and nearly 85% of combined wind and solar capacity
additions (Figure 1.13). Nevertheless, some technologies have expanded strongly in someother countries. For instance, India has seen particularly rapid progress in solar PV
deployment.

Figure 1.13 ⊳ Share of the global deployment of selected clean energy

technologies in advanced economies and China, 2010 and 2022

100%

Solar PVWindElectric cars

Heat pumps

1

Population
Rest of
world
China

80%

Advanced
economies

60%
40%
20%

2010 2022

2010 2022

2010 2022

2010 2022

2010 2022
IEA. CC BY 4.0.

Deployment of clean energy technologies remains highly
concentrated in China and advanced economies
Notes: Solar PV and wind indicate capacity additions. Electric cars and heat pumps indicate sales.

Box 1.2 ⊳Comparative pace of the clean energy transition

Comparing current events to what happened in the past is not without pitfalls, as no
historical analogy is a perfect fit. Nonetheless, looking at how technologies went fromniche to mass deployment in the past is a useful way to contextualise the changes
underway for clean energy technologies.

EV batteries and solar PV have also experienced rapid deployment growth by historicalstandards. Average annual deployment growth of EV batteries between 2010 and 2020
was 70%, with solar PV at 24%. Although this level of deployment growth is slightly lessthan achieved in the case of US aircraft production between 1939 and 1944, the annual
average cost reduction for both EV batteries (19%) and solar PV modules (18%), poweredby high levels of standardisation in manufacturing, outstrip the average cost declines
seen in both US aircraft production from 1942-1945 and the Ford Model T in the 1910s.
Chapter 1 | Progress in the clean energy transition

37

IEA. CC BY 4.0.

Some technologies experienced remarkably rapid growth in the past (Figure 1.14). For
instance, US aircraft production rose by an annual average of 75% between 1939 and
1944, driven by a seismic shift to a wartime economy. The Ford Model T achieved anannual average production growth rate of 34% in the 1910s, thanks to innovation in mass
production and the assembly line. These transitions were truly transformational,
kick‑starting the commercial aviation industry and the advent of affordable cars.

There have been even faster examples of technology transitions, though arguably lesscomparable. For example, computer memory prices reduced each year by an average ofabout 35% between both 1980-1990 and 1990-2000 (McCallum, 2023).
Figure 1.14 ⊳ Deployment growth and cost reduction of clean energy
80%
60%
40%
20%

-5%
-10%

Gas turbines(1970-80)

Ford Model T(1910-20)

US WWII aircraft(1939-44/1942-45)

Wind offshore(2010-20)

Wind onshore(2010-20)

Solar PV modules(2010-20)

EV batteries(2010-20)

-15%
-20%

Average annual
cost reduction

Average annual
deployment growthtechnologies, 2010-2020 relative to selected historical
technology transitions

IEA. CC BY 4.0.

Batteries and solar PV have progressed at rates comparable
to some of the most rapid historic technology transitions
Note: The datasets for US Aircraft production in WWII runs from 1939 to 1944 for average annual
deployment growth and from 1942 to 1945 for average annual cost reduction.
Sources: Lafond, Greenwald and Farmer (2022); Zeitlin (1995); Abernathy and Wayne (1974); Grubler
Nakicenovic and Victor, (1999).

Other technologies such as wind so far have followed a somewhat slower average
deployment trajectory, comparable to past transitions such as the introduction of gas
turbines in the 1970s, while still exhibiting annual growth rates of 10-20%.

38

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Although progress on some clean technologies compares favourably to historictransformational examples, the example of US WWII aircraft production in particularsuggests that even faster deployment could be achieved through more research anddevelopment (R&D) funding and more concerted government action.

Plans for large-scale technology projects are starting to increase rapidly
Large-scale technologies, such as CCUS, liquid biofuel or hydrogen-based steel production,
have seen slower deployment over the last decade than smaller mass manufactured andmodular technologies. For example, less new CO2 capture capacity was added between 2015
and 2022 than between 2010 and 2015. Large-scale technologies usually need to be tailoredto site-specific conditions and, due to their large unit sizes, offer fewer opportunities forlearning-by-doing advances than smaller and more modular technologies. This tends to mean
slower cost improvements. Some large-scale technologies are not yet available on themarket, which also hinders immediate commercial deployment.

1

Number of projects

Figure 1.15 ⊳ Global CO2 capture project pipeline, 2010-2023
400
300
200
100

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Q2
Operating

Under construction

Advanced development

Concept and feasibility
IEA. CC BY 4.0.

There has been strong growth in the project pipeline for CO2 capture in recent years,
implying that installed capacity is set to rise significantly

In recent years, however, the number of announced projects for large-scale technologies has
increased significantly. For example, the number of CCUS projects in the pipeline nearly
tripled in 2021 and have nearly doubled again since then (Figure 1.15), driven by stronger
policy support, particularly in the United States (IEA, 2023b). If all projects in the pipeline
were realised, CO2 capture capacity would expand more than eight-fold, rising from about
45 Mt today to reach nearly 400 Mt per year in 2030, and CO2 storage capacity would
increase to comparable levels (see Chapter 3). However, so far only about 5% of announced
projects have reached the final investment decision stage. Rapid acceleration of the
deployment of large-scale, site-specific technologies will require additional policy support,
including through measures to encourage investment in key enabling infrastructure such as
Chapter 1 | Progress in the clean energy transition

39

IEA. CC BY 4.0.

Notes: Includes all facilities with a capacity larger than 0.1 Mt CO2 per year. Q2 = second quarter. Under
construction = a final investment decision has been announced and construction is ongoing or imminent.
Advanced development = project is at front-end engineering and design stage and/or engineers have been
contracted and/or engineering, procurement, and construction have been announced.

CO2 storage facilities, to facilitate the demonstration and commercialisation of emerging
technologies, and to create larger and more international markets for low-emissions
products.
Box 1.3 ⊳Clean Technology Deployment Index

It can be hard to grasp the nature and extent of the changes taking place in the global
energy system and benchmark them against what needs to happen to meet the goals of
the Paris Agreement. The difficulty is increased by the size and complexity of the systemand by the slow rate of turnover of the huge stocks of often long-lived energy-related
infrastructure and equipment.
In order to provide a succinct and high-level summary of the rate of change, this report
has created a Clean Technology Deployment Index (CTDI). The CTDI has been developedby:

Gathering data on the historical annual deployment of clean energy technologies
and providing an estimate of expected deployment in 2023.

Indexing the historical annual values for each technology to the annual average
deployment of that technology in the NZE Scenario in the period 2028-2032.

Weighting each technology according to its share in global emissions reductions in
the NZE Scenario in 2030 (see Chapter 2, section 2.1.3).

This methodology means that the CTDI gives an aggregate measure of how far current
clean energy deployment levels are from the level required in 2030 in the NZE Scenario.
An index value of 100 would mean that clean energy deployment captured in the index
collectively reaches the level required in 2030. The estimated index value for 2023 of justover 30 implies that current levels of deployment of clean energy technologies are about
one-third of the level required in 2030 in the NZE Scenario (Figure 1.16).

The CTDI needs to be interpreted with a degree of caution. One reason is that thecomposition of clean energy technology deployment matters as much as the rate. Surging
ahead on one technology and falling behind on another might lead to a short-term boost
in the CTDI score without putting the energy system as a whole on a pathway to net zero
emissions by mid-century. In addition, the NZE Scenario is one pathway to net zero
emissions by 2050, and benchmarking current clean technology deployment against theneeds of alternative pathways would yield somewhat different results. Nonetheless, the40International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Between 2010 and 2023, deployment of clean energy technologies as measured by the
CTDI rose at an average annual rate of around 13%, leading the index value to increaseby 5-times over the period. There has been a clear acceleration in recent years, with clean
energy technology deployment more than doubling between 2019 and the 2023
estimate, achieving an average annual growth rate of over 20%. This compares to an
average annual growth rate of just under 20% needed from 2023 to 2030 to align with
the NZE pathway.

CTDI has value in showing the acceleration in deployment seen in recent years, as well as
in giving an indication of the levels of deployment needed over the course of this decade
to be on track to reach net zero emissions by mid-century.

NZE 2028-2032 = 100

Figure 1.16 ⊳ Clean Technology Deployment Index
30

20

10

2010

2015

2020

1

HydrogenBiofuels
CCUS
Heat pumps
Efficient appliances
EVs
Nuclear
Other renewables
Wind
Solar

2023e
IEA. CC BY 4.0.

Deployment of clean technologies has increased significantly since 2010
Notes: CCUS = carbon capture, utilisation and storage. 2023e = estimated values for 2023 based on thelatest available data by technology and project pipeline data.

1.4.2

Supply chains

Clean energy technology supply chains have been scaling up rapidly in recent years. Progresshas been particularly fast in the manufacturing segment, where countries are competing tosecure a place in the new global energy economy. For example, the nascent manufacturingsectors of solar PV in the early 2000s and of batteries in the 2010s have become vast
industries (IEA, 2023c). The speed of expansion has exceeded what was expected just a few
years ago, which has boosted hopes of getting the energy transition as a whole on track fornet zero emissions by 2050 (see Chapter 2).

Clean technology manufacturing capacity posted strong year-on-year growth rates in 2022
for batteries (+72%), solar PV (+39%), electrolysers (+26%) and heat pumps (+13%). This
momentum shows no sign of slowing in the near term given the pipeline of announced
manufacturing projects continuing to expand rapidly (Figure 1.17). In the first quarter of2023 alone, new announcements of solar PV manufacturing projects would increase
projected output by around 60% in 2030; the projected increase for batteries would bearound 25% and for electrolysers around 30% (IEA, 2023d).
Chapter 1 | Progress in the clean energy transition

41

IEA. CC BY 4.0.

Manufacturing capacity for some critical technologies is expanding rapidlyFigure 1.17 ⊳ Announced manufacturing project throughput anddeployment of key technologies in the NZE Scenario, 2030

150%

Production
2022
NZE 2030 deployment

100%With increased
utilisation
Announced projects
Commited
Preliminary

50%

Solar PV

Batteries

Wind

Heat
pumps

Electrolysers
IEA. CC BY 4.0.

If all announced projects proceed, solar PV manufacturing would exceed and batteries
manufacturing would get very close to the 2030 levels required in the NZE Scenario
Notes: 2022 production values reflect actual utilisation rates. A utilisation rate of 85% is used for both existing
and announced manufacturing capacity in 2030. Increased utilisation indicates that utilisation of existing
manufacturing capacity increases from current rates, which can be relatively low in some cases, to 85%.
Committed refers to projects that either have reached a final investment decision or are under construction.
Announced projects indicate announcements through first-quarter 2023. Note that data is available forannounced electrolyser manufacturing projects as of second-quarter 2023 in the Global Hydrogen Review
2023 (IEA, 2023e).

Growth in manufacturing capacity for key wind turbine components – nacelles, towers andblades – was much slower at around 2% in 2022. Some wind manufacturers are struggling toboost output due to supply chain disruptions and higher costs resulting from the effects of
the Covid-19 pandemic and Russia’s invasion of Ukraine. This follows a period of falling costs
and rapid expansion in the wind industry prior to 2020. Additional policy support would help
the wind power sector to overcome these challenges and play the critical role envisaged for
it in the NZE Scenario.

42

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

If all announced solar PV module manufacturing projects are realised, their combined output,
together with that from the increased utilisation of existing manufacturing capacity would
exceed the deployment needs of the updated NZE Scenario in 2030 by around 30%. EV andgrid storage battery needs for 2030 would also be almost fully met under the sameconsiderations. Caution is needed however as many announced projects have not yet
reached a final investment decision or started construction. Only around 25% of theannounced projects for solar PV manufacturing capacity worldwide can be consideredcommitted. The equivalent figure for batteries is around 30% and about 5% for electrolysers.

While the clean technology manufacturing base is expanding rapidly, it remains highly
concentrated geographically; the majority of current and announced manufacturing projects
are in China. Yet, recent policy changes are beginning to expand project pipelines elsewhere.
There have been notable increases in the project pipeline for battery production facilities in
the United States, driven in large part by the incentives provided by the IRA. Meanwhile theProduction Linked Incentive (PLI) programme in India is providing a boost to domestic
manufacturing, including through the provision of nearly USD 2.4 billion under the second
phase of the High Efficiency Solar PV Modules PLI that began in October 2022 andUSD 2.5 billion under the Advanced Chemistry Cell Battery Storage PLI announced in late
2021. Among key measures in the European Union, the Net Zero Industry Act (NZIA),
announced in March 2023, proposes measures to strengthen clean technology
manufacturing in the European Union.

1

In addition, other countries are providing support to promote clean technology
manufacturing. Recent initiatives include USD 1.8 billion in subsidies for battery
manufacturing in Japan’s Green Transformation (GX) initiative; a refundable tax credit for
30% of investment cost in new manufacturing equipment for key clean technologies in
Canada’s 2023 Budget; USD 5 billion in loans and guarantees from the Export-Import Bank of
Korea and state-owned Korea Trade Insurance to advance domestic battery manufacturing:and in Australia, USD 2 billion for domestic clean technology manufacturing via the National
Reconstruction Fund. More diverse and resilient supply chains will help strengthen security.

Clean technology markets are booming
The combined global market for five key clean energy technologies – solar PV, wind,batteries, electrolysers and heat pumps – surged to just under USD 300 billion dollars in
2022, a nearly 20% increase over the previous year. This was fuelled by rapid growth incapacity and sales, though it also reflects unit cost increases for some technologies in 2022
resulting from supply chain disruptions and energy and commodity price inflation. Sales wereconcentrated in major markets, notably China, North America and the European Union. EV
batteries and stationary storage applications contributed 65% of the market growth in 2022,
mainly due to the huge global increase in electric car sales from almost 7 million in 2021 (9%of global car sales) to over 10 million in 2022 (14% of global car sales).

Chapter 1 | Progress in the clean energy transition

43

IEA. CC BY 4.0.

The market size of these five technologies has almost tripled since 2010, a period during
which their unit costs declined on a combined deployment weighted average basis by around
80% (Figure 1.18). Absent these cost declines, an extra USD 1 trillion in spending would havebeen needed in 2022 to achieve the level of deployment in that same year.

Figure 1.18 ⊳ Global market size of selected clean energy technologies,
Billion USD (2022, PPP)

2010-2022

300

Electrolysers
Heat pumps
Batteries

200

Wind
Solar PV

100

2010

2015

2020

2022
IEA. CC BY 4.0.

The global market for five key clean technologies – solar PV, wind, batteries,
electrolysers and heat pumps – has almost tripled over the past decade

Progress in expanding supply chain capacity has been uneven
Large quantities of critical minerals are required for clean energy technologies and theirsupporting infrastructure, ranging from wind turbines and EV batteries to CO2 pipelines andpower grids. Since clean energy technologies already account for high shares of total demandof these minerals (between about 15-55% for lithium, cobalt, nickel and copper today),continuing growth in the deployment of these technologies hinges on rapid expansions insecure and sustainable critical mineral supply chains.

Investors are responding to these price spikes. The pipeline of announced projects for the
extraction and processing of key critical minerals points to continued expansion in supply thisdecade. For example, announced projects to expand lithium extraction capacity increased by
14% for lithium between the end of 2022 and the second quarter of 2023. Anticipated supply
based on announced extraction projects would meet approximately 90% of demand levels in
44

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Critical minerals extraction and processing capacity has increased significantly over the last
decade in response to rising clean energy and other demands. Between 2010 and 2022,
lithium mining output rose by a factor of five, and nickel and cobalt by a factor of two. Growthhas been particularly strong in recent years, with lithium mining output expanding by about
80% between 2020 and 2022, and output of nickel increasing by about 35% and cobalt by
about 40% over the same period (IEA, 2023f). Despite this growth in supply, markets havebeen tight as a result of rapid demand growth, especially for batteries. Lithium prices haveshown the largest volatility, with international price markers increasing more than five-foldbetween the first half of 2020 and 2022.

2030 in the updated NZE Scenario for copper, 80% for nickel, 65% for lithium, and 85% forcobalt (Figure 1.19). 8 (Chapter 4 explores critical minerals supply and demand in more detailin the context of the needs of the NZE Scenario).

1

Figure 1.19 ⊳ Production from existing and announced extraction projects

for key critical minerals relative to NZE Scenario requirements
in 2030
NZE needs in 2030

100%

Anticipated supply

75%

Production in 2022

50%

25%

CopperNickelLithium

CobaltIEA. CC BY 4.0.

Anticipated supply from the current pipeline of announced projects for
key critical minerals would provide at least 65% of 2030's NZE Scenario requirements
Notes: This figure shows primary demand and supply of critical minerals, excluding secondary production.
‘Anticipated supply’ is expected future production based on expert judgement from third-party data providers.
Expectations in commodity prices can have a large impact on the expected supply; a higher price might leadto more supply coming online. At the same time, unexpected delays in financing, permitting or construction
could delay projects and yield lower supply. The value is therefore lower than the sum of all announced
projects.

8 Mineral processing tends to follow similar trends as extraction.

Chapter 1 | Progress in the clean energy transition

45

IEA. CC BY 4.0.

One risk arises from the way that global supply is set to remain highly concentrated amonga small number of countries and companies. More diverse supply chains would increase
supply resilience. A different kind of risk comes from lengthy project lead times for new
supplies. Mining projects, including exploration, permitting and construction, can often takemore than a decade. Yet, the fastest mining developments can have a lead time of five years
or less from discovery to the start of production, e.g. the Nova-Bollinger mine in Australia
which produces nickel, cobalt and copper, even though ramping up production to full
capacity typically takes up to another three to four years when using established techniques.
This suggests that there is still enough time to further scale up supply to meet NZE Scenario
needs by 2030, even if the timelines are becoming very tight. Meanwhile continued R&D
could help to reduce the need to use critical minerals for which supplies are constrained.

Further increases in investment are urgently needed in the near term, as are government
efforts to diversify supply chains, reduce lead times and reduce material demand bypromoting recycling and innovation (see Chapter 4).

S P O T L I G H T
Energy access and energy security
Energy access
The Sustainable Development Goals (SDGs) were adopted in 2015, alongside the Paris
Agreement. We are now halfway between the year the goals were adopted and their2030 target year. For the energy sector, the SDGs set the objective of achieving fullenergy access by 2030 both for electricity and clean cooking. 9 In 2015, about 15% of the
global population did not have access to electricity and about 35% did not have access toclean cooking (Figure 1.20). In 2022, those numbers had fallen to 10% and around 30%
respectively.
Figure 1.20 ⊳ Population without access to modern energy by region, 2010Million people

2022

1 600

Electricity
Rest of world

400

Clean cooking

2 400

1 200

800

3 200

1 600

Developing Asia

800

Sub-Saharan Africa

2010

2014

2018

2022

2010

2014

2018

2022
IEA. CC BY 4.0.

Today nearly one-in-ten people worldwide do not have access to electricity
and nearly one-in-three still lack access to clean cooking technologies

Yet progress has been very uneven among regions. In developing Asia, the population
without access to electricity has fallen from about 20% in 2010 to less than 5% in 2022
(though this is still more than 120 million people). The large increase in access togas, liquefied petroleum gas (LPG), electricity and biogas, or improved biomass cookstoves (ICS) that haveconsiderably lower emissions and higher efficiencies than traditional three-stone fires.

46

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

9 Clean cooking is defined here as cooking facilities that use modern fuels and technologies, including natural

electricity that this represents was led particularly by India and Indonesia, which together
have seen the number of people without access to electricity fall by more than
300 million since 2015. On the other hand, sub-Saharan Africa has been going in thewrong direction, despite some individual countries making progress earlier in the decade
until the Covid-19 pandemic and 2022 energy crisis, and the total population without
access to electricity has slightly increased in recent years.

1

Substantial gains in clean cooking are evident in developing Asia, where the share of the
population without access to clean cooking solutions has declined from more than 40%
to less than 30% since 2015. This has been led by strong gains in India, China andIndonesia, where nearly half a billion people gained access to clean cooking technologies
in the last seven years (equivalent to about 7 000 people per hour). In sub-Saharan Africa,
however, population growth has outpaced progress: while the share of the population
without access to clean cooking has been gradually falling, the absolute number of people
without access has been steadily climbing due to rapid population growth. Nearly
1 billion people in Africa still cook with dirty and dangerous fuels that have severe
negative consequences for health and livelihoods.
The pandemic and the global energy crisis of 2022 were a major setback to progress onenergy access. With energy prices skyrocketing, we estimate that in 2022 some 75 million
people who recently gained access to electricity lost the ability to pay for it, and that
almost 100 million people worldwide may have been pushed back into reliance on
firewood and charcoal for cooking instead of cleaner, healthier alternatives.

Energy security

Chapter 1 | Progress in the clean energy transition

47

IEA. CC BY 4.0.

Russia’s invasion of Ukraine in early 2022 triggered a surge in energy prices (Figure 1.21).
Natural gas prices on the European benchmark briefly reached an all-time high of
USD 99 per million British thermal units (MBtu), almost 20-times higher than their 20162020 average (the highest monthly average reached in 2022 was USD 64/MBtu). Buyers
with little capacity to pay were priced out of the market, and countries such as
Bangladesh and Pakistan experienced blackouts due to fuel shortages. Prices for coal also
climbed to unprecedented levels, reaching monthly averages as high as USD 350420/tonne, or five-to six-times the 2016-2020 EU average. In some cases, power plants
and regions dependent on imported coal were forced to curtail purchases. These highprices fed into electricity prices in many markets. Governments around the world spent
more than USD 500 billion in 2022 to mitigate the impact of high prices on consumers.
The energy crisis exacerbated existing inflationary pressures, and the world experienced
a synchronized inflationary upswing unprecedented since the energy crises of the 1970s(IEA, 2022a).

Natural gas

80

USD/t

Oil

160

USD/MBtu

USD/bblFigure 1.21 ⊳ Benchmark international fossil fuel prices, 2020-2023
400

60

300

80

40

200

40

20

100

120

Jan
2020

Aug
2023

Jan
2020

Brent

EuropeAug
2023
United States

Coal

Jan
2020

Aug
2023
EuropeJapan
IEA. CC BY 4.0.

Fossil fuel prices skyrocketed on international markets during the 2022 energy crisis,
feeding into high electricity prices and further inflaming inflation
Notes: bbl = barrel. Prices shown are monthly averages.

The energy crisis accelerated both clean energy deployment and investment, as well as
investment in fossil fuel in response to concerns about the availability and affordabilityof energy supplies. Clean energy investment increased by about 15%, to reach around
USD 1.6 trillion in 2022 and is set to continue to rise rapidly. At the same time, investment
in fossil energy climbed by nearly 10%, to reach around USD 1 trillion and looks set toincrease again in 2023.
Disruptions in recent years have put the spotlight on the security of critical mineral andclean energy manufacturing supply chains. Prompted by rapid demand growth andsignificant supply concentration, governments have been taking action such as legislationthat aims to increase domestic supply of key clean energy technologies and related inputs
such as the Inflation Reduction Act in the United States and the Net Zero Industry Act inthe European Union, and through programmes such as the Production Linked Incentives
in India. This has had the positive effect of significant increases in the potential supply ofclean energy technologies, while at the same time raising concerns about potential
market distortions and the extent of public fiscal commitments.

Costs and performance

Over the last decade, considerable advances in clean energy technologies have cut costs,
improved performance and reduced material input requirements. Costs for selected mass
manufactured clean energy technologies – including solar PV, wind, heat pumps andbatteries, have fallen by close to 80% in aggregate (Figure 1.22).
48

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

1.4.3

Figure 1.22 ⊳ Equipment cost, performance and material needs per unit for
selected clean energy technologies, 2010-2022

100%

Equipment cost

Performance

225%

80%

200%

80%

60%

175%

60%

40%

150%

40%

20%

125%

20%

2010

100%
2010
2022

Onshore wind
Solar PV
Batteries
Weighted average

1

Material needs
100%

2022

Battery energy density
LED efficiency
Solar cell efficiency

2010

2022

Lithium use in EVs
Polysilicon use in Solar PV
Silver use in Solar PV
IEA. CC BY 4.0.

Deployment boosted cost reductions and improved theperformance of clean energy technologies in a virtuous cycle
Notes: Index values in 2010 = 100%. Equipment cost excludes engineering, procurement, construction andinstallation costs, and is in real terms. Weighted average equipment cost compares the costs of the annual
deployment of selected mass manufactured clean energy technologies, i.e. solar PV, onshore and offshorewind, heat pumps and batteries in aggregate to the costs as if there had been no cost reductions since 2010.
Sources: IEA analysis based on BNEF, (2022); VDMA, (2021) (2023); IEA,(2022a); IEA, (2023a); SPV Market
Research, (2022); RTS, (2021); PV InfoLink, (2022).

Notably, solar PV demonstrates impressive cost declines. Typically, as deployment increases,
the learning rate for a given technology (defined as the fall in unit cost associated with adoubling of cumulative deployment) tends to decrease. For solar PV modules, however, thelearning rate since 2006 of around 40% is actually higher than the average since the 1970s ofaround 25%, largely thanks to economies of scale in manufacturing and efficiency
improvements (VDMA, 2023) (IEA, 2020a) (Kavlak, McNerney and Trancik, 2018).

Costs have started to increase rather than decrease in the last two years for some clean
technologies such as solar PV and batteries, reflecting inflationary pressure and, in particular,
surging costs for critical minerals (IEA, 2023g). This period of cost increases is likely to be
Chapter 1 | Progress in the clean energy transition

49

IEA. CC BY 4.0.

Costs declines have been more modest for other technologies. For example, heat pump unit
costs fell by only around 5% on average over the 2010-2022 period, partly because the
manufacturing process was already mature. Large-scale site-tailored technologies, such ascarbon capture, also exhibit slower cost declines. Slower deployment has provided fewer
opportunities for learning. Furthermore, the site-specific and bespoke nature of large-scale
projects means that knowledge and experience gained may not always be applicable to otherprojects. This limits the potential for standardisation such that cost declines are likely to be
more modest even in the longer term.

temporary, as was the case for a similar period of inflation and high material costs in2007‑2009 and given that the critical mineral supply project pipeline has begun to rapidly
expand in response to increased demand. The risk of future volatility in raw material prices
can be mitigated by continuing to develop resilient and secure supply chains (see Chapter 4).
Considerable technology performance improvements have contributed to increase theattractiveness of technologies for consumers and reduce critical mineral requirements. For
example, driven in part by changes in composition and chemistries, the sales weighted
average energy density of batteries doubled since 2010 from around 90 Watt hour per
kilogramme (Wh/kg) to around 190 Wh/kg in 2023 (BNEF, 2023). This has enabled increased
driving ranges for EVs and a reduced use of lithium by about 30% per kilowatt-hour(IEA, 2023h).
Solar PV cells are another example of technology performance improvements. In 2010, on
average 14% of the solar energy hitting a solar panel was converted to electricity; by 2022,
that figure had risen by half to 21% efficiency. This gain helped bring about a 60% reductionin the use of polysilicon and an 80% reduction in the use of silver in the average solar PV cellsince 2010. Since polysilicon and silver make up around 20-30% of solar PV module costs,
this level of improved efficiency and the related material savings have been an important
contributor to declining costs. With more advanced cell designs and tandem technologies
such as silicon perovskites entering the market, average efficiency is expected to improve
even more in the coming years.

1.4.4

Innovation

Power generation: New commercial-scale designs of small modular nuclear reactors are
expected to come online this decade in China, Europe and North America; floating
offshore wind parks are getting bigger than ever with parks of several hundred MW
announced for 2025-2026, also announced are a 1 GW offshore installation in China for2027 and a 6 GW project in Korea for 2030; perovskite solar cells are nearing 30%
efficiency, with several firms in China, Europe and the United States competing tocommercialise the first modules.



Low-emissions hydrogen supply: Commercial-scale demonstrations of solid oxide
electrolysers are underway. The two large demonstrators started operating in 2023.

Road transport: Sodium-ion batteries for EVs are being scaled up, moving fromprototypes pre-2021 to first-of-a-kind commercial production in China in 2023.

50

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Innovation has a critical role to play in reaching net zero emissions, especially in sectors suchas heavy industry and long-distance transport where emissions are hard to abate because
low-emissions technologies or processes are not yet readily available. Considerable progresshas been made in recent years to address pressing innovation gaps, and this has resulted in
upgrades in the technology readiness level of some critical clean energy technologies(Figure 1.23). Selected illustrative examples of innovation progress in recent years include
the following areas.



Heavy industry: Scaling up carbon capture via direct separation in cement production isunderway (a final investment decision taken for LEILAC-2 with production of
100 kilotonnes [kt] of CO2 per year); 100% electrolytic hydrogen-based direct reducediron production could soon be demonstrated at industrial scale (HYBRIT, the mostadvanced project for this technology, produced fossil-free steel for the first time in
Sweden in November 2021); small-scale use of carbon-free aluminium in consumer
goods is moving ahead (ELYSIS, Canada, expects first-of-a-kind demonstration ofcommercial production by 2026 before moving to industrial production).



Critical minerals: Bioleaching for electronic waste recycling and metal recovery ismoving to first-of-a-kind commercial operation (this technique has been used in themining industry for years and now is being considered to recover critical minerals frombatteries); direct lithium extraction from geothermal brine is at the pre-commercial
demonstration stage.



Direct air capture: In Iceland, a first-of-a-kind 4 kt CO2/year project has begun capturing
CO2 from the air and storing it underground with plans to expand to 36 kt CO2/year aspart of a broader effort to demonstrate multi-megatonne capacity by 2030.
A 0.5 Mt/year plant is under construction in the United States and aims to begin
operations in 2025.

Aviation: Regional electric planes with up to 30 passengers are being designed withcommercial flights expected before 2030; electric vertical take-off and landing models
are being demonstrated; hydrogen-powered aircraft designs are being developed,
though they are at an earlier stage and operations are not expected to begin until after
2030.



Shipping: The first industrial plant that converts biogas into low-emissions bio-liquefied
natural gas for use as drop-in fuel to replace heavy fuel oil is set to begin operations in
2023 (FirstBio2Shipping, Netherlands, which received funding from the European Union
Innovation Fund). Several major ship engine makers are in the final stages of developing
ammonia two-stroke engines for commercialisation by 2025; large methanol-powered
container ships are being delivered for the first time in 2023 just as electrolytichydrogen-based methanol commercial production starts; and small-scale hydrogen fuelcell ferries began operating in Norway and the United States in 2023.

1

10 The IEA Clean Energy Technology Guide contains information on more than 550 individual technology
designs and components that can contribute to getting on track with the NZE Scenario, with indications oftechnology maturity and major R&D and demonstration activities (https://www.iea.org/articles/etp-cleanenergy-technology-guide).

Chapter 1 | Progress in the clean energy transition

51

IEA. CC BY 4.0.

For a comprehensive overview of the full suite of technologies and projects related to clean
energy innovation, see the IEA Clean Energy Technology Guide. 10

Figure 1.23 ⊳ Evolution of technology readiness levels for selected
clean energy technologies

TRL
MatureMarketuptakeDemonstration
Large
prototype
Concept
and small
prototype

11
10
9
8
7
6
5
4
3
2
1
1920

Grid-scale onshore wind
Grid-scale solar PV
Lithium-ion battery
Sodium-ion battery
Cement direct separation
carbon capture
100% electrolytic H₂-based
DRI steelmaking
1940

1960

1980

2000

2020
IEA. CC BY 4.0.

Significant advances in clean energy technology development have been made in recent
years, but much remains to be done to put the world on a net zero emissions pathway
Notes: TRL = Technology Readiness Level; H2 = hydrogen; DRI = direct reduced iron. For 100% electrolytic
H2-based DRI steelmaking, R&D related to using hydrogen in steelmaking has been taking place for decades,
including at one commercial plant in the 1990s relying largely on hydrogen. In this figure, the focus isspecifically on 100% electrolytic H2.

Public and corporate spending on energy R&D has been increasing despite the pandemic andmacroeconomic crises (IEA, 2023g) (Figure 1.24). Governments allocated nearly
USD 44 billion to energy R&D in 2022, more than 80% of which was earmarked for clean
energy, compared with around USD 30 billion in 2015, when 70% of the total was for clean
energy. Much of the increase in public energy-related R&D over the last few years is in China,
which is now the largest spender in this area. Advanced economies account for most of therest. The emerging market and developing economies excluding China together accounted
for just 5% of the global total in 2022.

The role of start-ups in clean energy innovation is also growing and has shown impressive
resilience in the face of recent macroeconomic crises (IEA, 2023g). Clean energy venture
52International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Energy R&D spending by globally listed companies exceeded USD 130 billion in 2022, anincrease of 25% from 2020. Spending by companies developing renewables increased on
average by 25% each year between 2020 and 2022 compared with 5% per year over the
2010-2020 period. The R&D budgets of major oil and gas companies have remained more orless flat since 2010. Aviation, rail and shipping were badly hit by the Covid-19 crisis and their
R&D spending has not increased much since. By contrast, R&D spending recovered quickly inchemicals, cement and iron and steel, although a relatively low share of energy R&D budgets
in industrial sectors is directed to clean energy, indicating further opportunities to increasespending.

capital investment nearly doubled between 2010 and 2020 and has more than doubled again
since then. Total investment reached USD 7 billion for early-stage start-ups and
USD 35 billion for growth stage start-ups in 2022, with notable growth in investment in EVs
and batteries, hydrogen, renewables and energy efficiency.

1

The number of global patents in low-emissions energy technologies has been rising over thelast two decades, while for fossil fuels it has been declining since 2015 (IEA, 2021c). Between
2005 and 2018, for example, patenting in batteries increased 14% annually on average, fourtimes faster than the average of all technology fields (IEA, 2020b). Clean technologies
accounted for nearly 80% of all patents related to hydrogen production in 2020 (IEA, 2023i).
Figure 1.24 ⊳ Global public and corporate spending on energy R&D andBillion USD (MER, 2022)

venture capital investment in clean energy start-ups, 2010-2022

Governments

100%

150

40

80%

30

Listed companies

100%

50

120

80%

40

60%

90

60%

30

20

40%

60

40%

20

10

20%

30

20%

10

50

2010

2022

2010

2022

Venture capital

2010

2022

Share in clean energy (right axis)
IEA. CC BY 4.0.

Energy R&D spending by governments and corporations, andclean energy venture capital investment have grown substantially

Chapter 1 | Progress in the clean energy transition

53

IEA. CC BY 4.0.

Note: MER = market exchange rate.

Chapter 2
A renewed pathway to net zero emissions
Net zero emissions guide
S U M M A R Y• The Net Zero Emissions by 2050 Scenario (NZE Scenario) relies on the deployment ofa wide portfolio of low-emissions technologies and emissions reduction options toreach net zero CO2 from the energy sector by 2050, but it also depends on a highdegree of global co-operation and collaboration. Advanced economies take the leadand reach net zero emissions by 2045 in aggregate in the NZE Scenario, China by 2050
and other emerging market and developing economies after 2050. The
comprehensive NZE Scenario update presented here reflects real-world progresssince our Net Zero by 2050: A Roadmap for the Global Energy Sector report in 2021
and a continuous assessment of feasibility across sectors and technologies, but it is
not the only pathway to reach the goal of net zero emissions by 2050.

• Taken together, solar photovoltaics (PV) and electric vehicles (EVs) provide one-thirdof the emissions reductions to 2030 in the updated NZE Scenario. The share of electriccars in total car sales soars to more than 65% by 2030, and solar PV capacity increases
fivefold from today. The announced manufacturing pipeline for solar PV and batteries
is projected to be sufficient to meet the NZE Scenario deployment needs to 2030.
Demand for oil and gas declines by around 20% by 2030 – fast enough that no newlong lead time conventional oil and gas projects need to be approved fordevelopment. Low-emissions electricity rises so rapidly that no new unabated coalplants beyond those under construction at the start of 2023 are built.

• Technologies under development are essential to achieve net zero emissions.
Progress in clean energy innovation over the past two years, such as on battery
chemistries, and the even stronger market momentum of commercial technologies
such as solar PV, have had a tangible impact. In our 2021 report, the share ofemissions reductions in 2050 from technologies under development was almost half:that figure has now fallen to around 35% in our updated NZE Scenario.

• The extraordinary surge in global manufacturing capacity for solar PV and batteries
underpins their more significant role in the period to 2030. Capacity additions of wind
have been revised downwards relative to the 2021 NZE Scenario, but wind is stillcritical to reach net zero emissions; further policy support is required to help
overcome challenges in wind power deployment. The role of nuclear power has beenrevised upwards given recent policy support.
(CCUS) have an important part to play to reduce emissions in heavy industry and longdistance transport. In the 2023 NZE Scenario, they provide one-fifth of all emissions
reductions between 2030 and 2050. But the part they play is smaller than in the 2021
version, particularly in the near term. This reflects slower technological and market
development progress than envisaged in 2021 and stronger electrification prospects.
Chapter 2 | A renewed pathway to net zero emissions

55

IEA. CC BY 4.0.

• Hydrogen and hydrogen-based fuels and carbon capture, utilisation and storage2.1

Overview of the NZE Scenario

2.1.1

Scenario design

This report sets out an updated NZE Scenario – referred to as the 2023 NZE Scenario – thattakes into account the key changes that have occurred since 2021 in energy policies,
technologies, markets and supply chains. It reflects the latest IEA data that track energy
policies; developments in the deployment and innovation of more than 550 clean energy
technologies; supply chain capacities for critical minerals and clean energy technology
manufacturing; and progress towards the more than 400 milestones presented in the 2021
Net Zero by 2050 report (IEA, 2021a). The NZE Scenario pathway achieves net zero CO2emissions from the energy sector by 2050, leading to limited overshoot of the 1.5 °C limit set
out in the 2015 Paris Agreement, but the increase in global average temperature falls below
1.5 °C by 2100. 1Describes a pathway for the global energy sector to reach net zero emissions of CO2 by
2050 by deploying a wide portfolio of clean energy technologies and without offsetsfrom land-use measures. Decisions about technology deployment are driven by costs,
technology maturity, market conditions, available infrastructure and policy preferences.
Building on the IEA 2021 NZE roadmap analysis, this report evaluates the balance oftechnology deployment taking into consideration progress and setbacks over the last
two years (Spotlight). It also provides an in-depth analysis of the current trajectory of
key technologies and mitigation options, and what it would take to put the world on
track for the NZE Scenario (see Chapter 3).



Prioritises an orderly transition that aims to safeguard energy security through strong
and co‐ordinated policies and incentives that enable all actors to anticipate the rapidchanges required, and to minimise energy market volatility and stranded assets. Rapid
deployment of clean energy technologies and energy efficiency is at the core of thistransition. The NZE Scenario is underpinned by detailed analysis of project lead times
for minerals supplies and clean energy technologies as part of efforts to ensure thefeasibility of the deployment. There is, however, inevitably a risk of bottlenecks
emerging for some technologies, which underscores the importance of measures toenhance material reuse and recycling and to drive down the material intensity of clean
energy technologies.



Recognises that achieving net zero energy sector CO2 emissions by 2050 depends on fairand effective global co-operation. The pathway to net zero emissions by 2050 is very
narrow. All countries are required to contribute to deliver the desired outcomes;
advanced economies take the lead and reach net zero emissions earlier in the NZE
Scenario than emerging market and developing economies. Global access to electricity

1 High overshoot refers to an increase in global average temperature to above 1.6 °C, but below 1.8 °C above

pre-industrial levels and a subsequent fall to below 1.5 °C (IPCC, 2023).

56

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The 2023 NZE Scenario:

and clean cooking is achieved by 2030 in line with established Sustainable Development
Goals. Rapid and major reductions in methane emissions from the oil, gas and coalsectors help to buy some time for less abrupt CO2 reductions in emerging market anddeveloping economies. Without these reductions, global energy sector CO2 would needto reach net zero by around 2045, with important implications for equitable pathways.
Global collaboration facilitates the development and adoption of ambitious policies,
drives down clean technology costs, and scales up diverse and resilient global supply
chains for critical minerals and clean energy technologies. Enhanced financial support toemerging market and developing economies plays a critical part in this collaboration.

2

S P O T L I G H T
Key changes since the 2021 version of the NZE Scenario
The IEA tracks hundreds of thousands of energy sector datapoints that cover elements
ranging from policy developments, technology deployment, investment and supply
chains to infrastructure, innovation and costs. This data-driven approach feeds the model
used to develop the NZE Scenario, which also factors in the various circumstances ofindividual countries and regions in great detail. This allows the NZE Scenario to takeaccount of the feasibility of scaling up emissions reduction options at the speed and scalerequired across various regions, sectors and technologies, and to integrate concerns
about equity (Box 2.1).
In the Net Zero by 2050 report in 2021, we noted that the precise pathway for thetransition would be uncertain (IEA, 2021a), stating “… some of these milestones will bemet, others will not, and some technologies will fail to deliver and others will surprise us– technology deployment rarely ever follows an idealised trajectory” (IEA, 2021b).

While the goal of net zero energy sector CO2 emissions by 2050 is retained, emissions
to 2030 are higher in this edition of the scenario, reflecting the extremely strong
rebound in economic activity and emissions in the wake of the Covid-19 pandemic,
as well as the failure to act in recent years at the speed envisaged in our originalreport.



Total energy demand in 2030 is slightly higher in the 2023 NZE version, reflecting thepost-pandemic rebound in economic activity and slower progress than envisaged in
implementing strong energy efficiency policies. Energy efficiency continues to playa critical role in the 2023 NZE Scenario (see Chapter 3).

Near-term use of coal is higher in the 2023 NZE Scenario to reflect both the desire
to plot a more equitable pathway for emerging market and developing economies,
which dominate global coal use, as well as the energy security concerns aroundnatural gas sparked by Russia’s invasion of Ukraine.

Chapter 2 | A renewed pathway to net zero emissions

57

IEA. CC BY 4.0.

The main differences between this 2023 NZE Scenario and the 2021 version are(Table 2.1):

Table 2.1 ⊳Selected indicators in the 2021and 2023 NZE Scenarios
2021 version

2023 version

Peakwarming

2100
warmingPeakwarming

2100
warming

Consistent
with IPCC C1
scenarios

1.4

Consistent
with IPCC C1
scenarios

1.4

2030

2050

2030

2050

Total net energy sector CO2 emissions (Gt)

21.1

0.0

24.0

0.0

Share of unabated fossil fuels in
total energy supply (%)

58%

11%

62%

11%

Total final consumption (EJ)

390

340

410

340

Solar PV capacity additions (GW)

630

630

820

820

Wind capacity additions (GW)

390

350

320

350

Share of EVs in car sales (%)

60%

90%

65%

95%

Total CO2 capture (Gt)

1.8

7.7

1.0

6.1

Median temperature increase (°C)

Total CO2 removal (Gt)

0.3

1.9

0.2

1.7

Installed stationary battery capacity (GW)

590

3 100

1 020

4 200

Share of electricity intotal final consumption (%)

26%

49%

28%

53%

Share of H2 and H2-based fuels in
total final consumption (%)

2%

10%

1%

8%



Solar PV takes a more prominent role in the 2023 NZE Scenario, though reductionsin projected wind capacity additions mean that the combined share of wind andsolar PV in total generation is very similar in both NZE Scenario versions, at around
40% by 2030. This reflects the surge in solar PV installations and manufacturing
capacity since 2021 report. Correspondingly, the boost in solar PV generation spurs
the need for additional stationary battery storage to ensure security of supply.

Electric vehicles (EVs) also have an even more prominent role in the 2023 NZE
Scenario. This reflects both a significant uptick in EV sales and progress in scaling up
manufacturing supply chains. This electrification in road transport together withaccelerated progress in heat pump deployment in buildings and rising market
confidence in technologies such as 100% electrolytic hydrogen-based direct reducediron production, results in more rapid growth in the share of electricity in final
energy consumption. 2

Near-term deployment is slower for some technologies in the 2023 NZE Scenario,
e.g. wind, hydrogen and carbon capture, utilisation, and storage (CCUS). This reflects

58International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Notes: IPCC = Intergovernmental Panel on Climate Change. Gt = gigatonnes; EJ = exajoules; GW =gigawatts; EVs = electric vehicles; H2 = hydrogen. IPCC C1 scenarios are scenarios assessed by the IPCC
which keep warming below 1.5 °C with no or limited overshoot. Unabated fossil fuels includes fossil fuels
used for non-energy purposes.

supply chain constraints, delays in scaling up project pipelines and related
infrastructure, and sluggish progress in the development of market frameworks forless mature technologies. For some of these technologies, the downward revision isbased on recent investment trends from technology manufacturers against other
low-emissions alternatives. One example is a reduced role for hydrogen-fuelled
trucks.

2

Some of the changes since the 2021 version of the NZE Scenario are helpful in terms ofachieving the objectives while others are not. Overall, the path to achieving net zero
emissions by 2050 in the 2023 NZE Scenario is a steeper one than in the 2021 version andrequires more to be done after 2030. But the path remains open. The latest
Intergovernmental Panel on Climate Change (IPCC) reports underscore the increasing
urgency of achieving net zero emissions (IPCC, 2023).

Box 2.1 ⊳Integrating equity into the NZE Scenario design

Reaching net zero emissions by 2050 requires action on the part of all countries. Different
countries have varying starting points, capacities, and resource endowments.
Differentiated pathways are delineated in the NZE Scenario as an essential designprinciple (Figure 2.1). Advanced economies take the lead and reach net zero emissions
by around 2045 as a group, consistent both with their higher financial capacities andresponsibility for historical emissions. With per capita emissions above those of advanced
economies today, China achieves net zero emissions around 2050 in the NZE Scenario;
other emerging market and developing economies reach it only well after 2050. The
global net zero CO2 emissions target is achieved thanks to net negative emissions inadvanced economies, with remaining residual gross emissions concentrated in emerging
market and developing economies other than China.
Determined action, particularly in advanced economies and in large oil and gas producing
countries, cause oil and natural gas emissions of both CO2 and methane to fall faster in
the NZE Scenario than in comparable scenarios assessed by the IPCC. Emissions from coalfall more slowly in the NZE Scenario than in comparable scenarios assessed by the IPCC
reflecting a less abrupt transition in emerging market and developing economies, whichtoday are responsible for more than 80% of global coal use. As a result, emissions inadvanced economies fall nearly two-times faster in the current decade than emissions inemerging market and developing economies.

2 Final energy consumption reflects the energy form that is brought to an industrial site, which is electricity inthe case of captive hydrogen produced onsite at iron and steel facilities to reduce iron ore.

Chapter 2 | A renewed pathway to net zero emissions

59

IEA. CC BY 4.0.

Successful achievement of universal access to electricity and clean cooking by 2030 inline with Sustainable Development Goal 7 is a key pillar of the NZE Scenario. This hinges
on both enhanced financial support by the international community and stronger

domestic policies in countries that lack full access. In addition to bringing important
benefits for health and gender equality, achieving SDG 7 yields a net reduction ingreenhouse gas emissions and air pollution, by reducing the incomplete combustion of
biomass and deforestation.

Gt CO2

Figure 2.1 ⊳14Gross emissions and removals, and net emissions byaggregated region in the NZE Scenario, 2010-2050
Advanced economies

12

6
4

20
16

Gross
emissions

12
8
4

2
0
-2
2010

Emerging market and developing

24

Net emissions

10
8

28

0

Gross removals
2030

2050

-4
2010

2030

2050
IEA. CC BY 4.0.

As a group, advanced economies reach net zero emissions before emerging market
and developing economies, and also achieve net negative emissions by 2050
Note: Gt CO2 = gigatonnes of carbon dioxide; EMDE = emerging market and developing economies.

In emerging market and developing economies other than China, the NZE pathway
requires clean energy investment to increase nearly sevenfold by the early 2030s
compared to recent averages. Such mobilisation of capital requires frameworks that
attract the private sector as well as international public support. Equitable pathways
within countries also have a part to play in getting to net zero emissions. These aspects
are discussed in Chapter 4.

Key socio-economic assumptions

3 This is in line with the median variant of the United Nations population projections (UN DESA, 2022).

60

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The NZE Scenario sees the transformation of the energy sector taking place at the same time
as a large increase in the global population and economy (Table 2.2). By 2030, the world
population is projected to reach over 8.5 billion and almost 10 billion by 2050. 3 Nearly all of
the increase is in emerging market and developing economies, including around 1.1 billion
more people in Africa by 2050. In parallel, the global economy continues to recover fromrecent crises. Growth is expected to slow somewhat in the near term, but the size of the
global economy is projected to roughly double by 2050.

Table 2.2 ⊳Key socio-economic assumptions in the NZE Scenario, 2022-2050

World population (million people)

2022

2030

2040

2050

7 950

8 520

9 161

9 681

China

1 420

1 410

1 372

1 307

India

1 417

1 515

1 612

1 670

Advanced economies

1 415

1 441

1 461

1 460

Rest of world

3 698

4 154

4 716

5 244

164

207

270

339

98

42

30

25

United States

5.1

2.4

2.4

2.4

European Union

32.3

4.3

4.2

4.1

China

13.7

5.9

5.3

5.3

Japan

15.9

5.5

5.3

5.3
23

World GDP (USD trillion, 2022, PPP)

2

Energy prices (USD, 2022, MER)IEA crude oil (USD per barrel)
Natural gas (USD/MBtu)

Steam coal (USD/tonne)
United States

53

27

24

European Union

290

57

45

43

Japan

336

65

51

47

Coastal China

205

64

54

49

Advanced economies

140

205

250

Emerging market and developing economies(with net zero emissions pledges)

90

160

200

Selected emerging market and developing
economies (without net zero emissions pledges)

25

85

180

Other emerging market and developing
economies

15

35

55

CO2 prices for electricity, industry andenergy production (USD/t CO2)

Note: PPP = purchasing power parity; MER = market exchange rate; MBtu = million British thermal units.

All regions introduce pricing of CO2 emissions alongside other policies designed to bringabout clean energy transitions in the NZE Scenario. Carbon pricing is implemented first inadvanced economies, which see prices rise on average to USD 250 per tonne of carbon
dioxide (t CO2) by 2050. Major emerging market and developing economies with net zero
emissions pledges, such as China, Brazil and Indonesia, see prices reach USD 200/t CO2 by
2050. Carbon prices are lower in the rest of the world.
Chapter 2 | A renewed pathway to net zero emissions

61

IEA. CC BY 4.0.

Energy price projections are subject to a high level of uncertainty. In IEA scenarios prices aredesigned to reflect an equilibrium between supply and demand. In the NZE Scenario, a rapid
drop in oil and natural gas demand lowers prices to the operating cost of the marginal projectneeded to meet demand. As a result, international fossil fuel prices fall significantly, with theoil price dropping below USD 50 per barrel by 2030.

2.1.2Emissions and temperature trends

CO2 emissions from the energy sector in the NZE Scenario fall steeply from 37 gigatonnes(Gt) in 2022 to 24 Gt in 2030, a reduction of around 35%. By 2035, emissions fall to around13.5 Gt, or nearly 65% below the 2022 level (Figure 2.2). Atmospheric removals throughdirect air capture and storage (DACS) and bioenergy with carbon capture and storage (BECCS)
start to scale up rapidly and reach around 0.6 Gt in 2035 and 1.7 Gt in 2050. Total energy
sector CO2 emissions reach net zero in 2050, with residual gross emissions balanced by grossremovals from the atmosphere through BECCS and DACS. This is achieved without offsetsfrom land-use measures. Total greenhouse gas (GHG) emissions from all sectors are reduced
by around 40% by 2030 and by 60% by 2035.

Gt CO₂

Figure 2.2 ⊳Energy sector gross emissions and removals, total net CO2
emissions, and net emissions by sector in the NZE Scenario,
2010-2050

40

16

35

14

Net emissions

30

12
10

25
20
15

Electricity

8

Gross emissions

6

10

Transport
4 Buildings

5

2

0

0

-5
2010

Gross removals
2030

2050

-2
2010

Industry

Other
2030

2050
IEA. CC BY 4.0.

Energy sector CO2 emissions are reduced 65% by 2035 and reach net zero by 2050, withresidual emissions of 1.7 Gt balanced by atmospheric removals of the same magnitude

On a sector basis, electricity sees CO2 emissions fall the most, with emissions almost halving
between 2022 and 2030 as renewables and other low-emissions sources of electricity
generation are deployed rapidly and unabated fossil fuel-based generation declines. Other
sectors, where low-emissions options are still being developed or ramped up, are slower todecrease emissions. Nevertheless, emissions from all sectors peak in the near term. Sectoral
62

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Total energy-related emissions reach 2.3 gigatonnes of carbon dioxide (Gt CO2) in advanced
economies by 2035, 4.2 Gt CO2 in China and around 6 Gt CO2 in other emerging market anddeveloping economies. Advanced economies reach net zero emissions by around 2045,
China by 2050 and other emerging market and developing economies only well after 2050.

emission decreases between 2022 and 2030 are 20% in industry, around 25% in transport
and around 40% in buildings.
Between 2030 and 2040, the electricity sector reaches very low levels of emissions in the
NZE Scenario, with advanced economies reaching net zero emissions from the sector inaggregate in 2035. This milestone is reached in 2045 in emerging market and developing
economies, which is five years later than in the 2021 version of the NZE Scenario. Manytechnologies still being developed today, such as those that support the electrification ofheavy industry or zero emissions ships, begin to be deployed quickly in the 2030-2040 decade
which leads to replacement or retrofitting of existing assets.

2

Though emissions in the industry and transport sectors both shrink by over 60% between
2022 and 2040, these two sectors remain responsible for close to 90% of residual emissions
in 2040. Even by 2050, residual CO2 emissions from fuel combustion are concentrated in theindustry (0.2 Gt) and transport (0.6 Gt) sectors.
By 2050, the electricity, buildings, and other transformation sectors account for 0.4 Gt ofresidual emissions, and industrial processes for around a further 0.4 Gt. These emissions arecounteracted by atmospheric carbon dioxide removal through BECCS and DACS, which
account for 1 Gt and 0.7 Gt of removals respectively.
The IEA models the consequences of its scenarios for climate change using the MAGICC
climate model, which is widely used in IPCC assessments. 4 The global mean temperature rise 5
above pre-industrial levels stands today at around 1.2 °C. In the NZE Scenario, this rises to apeak of just below 1.6 °C around 2040, and then gradually falls to around 1.4 °C in 2100
(Figure 2.3). This reduction in temperature from the peak is caused by two effects. First is
strong reductions in methane emissions to 2050. Second is that temperatures are also
reduced after reaching net zero CO2 emissions as the land and oceans draw down
atmospheric carbon in line with the latest generation of Earth system models (MacDougall
et al., 2020). These effects are consistent with the Working Group I contribution to the IPCC’s
Sixth Assessment Report and each contribute about 0.1 °C of cooling between 2040-2100.
The NZE Scenario therefore meets the criteria of a limited overshoot 1.5 °C pathway as
defined by the IPCC. By contrast, the IEA Stated Policies Scenario (STEPS) sees energy sector

4 Most energy‐related greenhouse gases (GHG) in IEA scenarios are modelled using the IEA’s GEC Model(https://www.iea.org/reports/global-energy-and-climate-model). Significant sources of other GHG, e.g., black
carbon, as well as GHG related to land use consistent with IEA scenarios are modelled by the International
Institute of Applied Systems Analysis (IIASA). The MAGICC model supplements all remaining types and sourcesof GHG using the scenario database published as part of the IPCC Special Report on Global Warming of 1.5 °C(IPCC, 2018).

rise, meaning that there is a 50% probability of remaining below a given temperature rise. All changes intemperatures are relative to 1850‐1900 and match the IPCC Sixth Assessment Report definition of warming of0.85 °C between 1995‐2014 (IPCC, 2021). Modelled temperature rise estimates reflect anthropogenicallyinduced trends but do not capture natural modes of variability, such as those connected to the El Niño
Southern Oscillation (Berkeley Earth , 2023).

Chapter 2 | A renewed pathway to net zero emissions

63

IEA. CC BY 4.0.

5 Unless otherwise stated, temperature rise estimates quoted in this section refer to the median temperatureCO2 emissions fall only moderately to 30 Gt by 2050. As a consequence, global warming
continues to worsen, with the temperature rise exceeding 1.9 °C around 2050 and heading
towards 2.4 °C in 2100. Inherent uncertainties in the Earth’s response to future warming
mean that there is about a one-third probability of warming exceeding 2.6 °C in the STEPS in
2100; in the NZE Scenario there is just over a one-third probability of exceeding 1.5 °C in
2100.

°C

Figure 2.3 ⊳Median warming in the STEPS and NZE Scenario, 2020-2100

3.0
2.5

STEPS

2.0
1.5

NZE

1.0
0.5
2020

2040

2060

2080

2100
IEA. CC BY 4.0.

Rapid emission cuts moderate warming below 1.5 °C by 2100 with low overshoot in the
NZE Scenario, while temperatures in STEPS reach 2.4 °C by 2100 and continue rising
Notes: STEPS = Stated Policies Scenario. Shaded area represents the 33-67% confidence interval. Solid line
represents median warming.
Source: IEA analysis based on Climate Resource and MAGICC 7.5.3.

Sectors other than energy also have an important part to play in cutting emissions. Rapid
cuts in GHG emissions from other sectors, such as agriculture, forestry and other land use(AFOLU) and waste treatment, account for just under 30% of the warming avoided in the
NZE Scenario compared to the STEPS to 2050, based on IEA modelling with the MAGICC
climate model. For example, parallel action to stop deforestation and improve themanagement of existing forests brings CO2 emissions from land use to net zero by about 2030
in the NZE Scenario, and improvements in livestock husbandry alongside efficiency gains in
64International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Rapid reductions in greenhouse gases other than CO2 are also essential to curb the global
temperature rise. Less than 60% of the warming avoided to 2050 in the NZE Scenario
compared to the STEPS is due to CO2 emissions cuts. Reduced emissions of methane makeup almost 40% and cuts to other GHG such as nitrous dioxide (N2O) and fluorinated gases
account for the remainder. Rapid reductions in these other gases are essential to curb global
temperature increases (Figure 2.4).

crop management and fertiliser use contribute to cuts in AFOLU-related N2O and methane
emissions of around 10% and 35% respectively in 2050 compared to the levels in the STEPS.
Figure 2.4 ⊳100%

Global warming avoided in the NZE Scenario relative to the STEPS
by greenhouse gas and source, 2022-2050

By greenhouse gas

75%

Methane

100%

CO2

2

By source
Other sources

75%

50%

50%

25%

Other gases
N2O

Fossil fuels
and cement

25%

IEA. CC BY 4.0.

Reductions in CO2 emissions are responsible for less than 60% of thewarming avoided to 2050 in the NZE Scenario relative to the STEPS
Source: IEA analysis based on Climate Resource and MAGICC 7.5.3.

Box 2.2 ⊳Effects of global warming at 1.2 °C degrees temperature rise

Recent extreme weather events have led to increasingly widespread concern about a“climate crisis”. India and Pakistan were hit by disastrous flooding in 2022. Over thesummer of 2023, an extreme heat wave hit southern Europe and other parts of the world;in China and the United States, temperatures reached over 52 °C. More than 30 million
acres were charred by wildfires in Canada by mid-2023, and the Horn of Africa is
experiencing the longest and most severe drought on record.

Chapter 2 | A renewed pathway to net zero emissions

65

IEA. CC BY 4.0.

In summer of this year, Earth had the hottest three-month period ever recorded, and it
is now likely that 2023 will be the hottest year on record (Carbon Brief, 2023). To date,
the global average temperature has increased to around 1.2 °C above pre-industrial
levels (Berkeley Earth, 2023). This is already having an effect in every region around theworld. The increasing frequency and intensity of heatwaves, droughts, storms and floods
are in line with predictions made in the IPCC Assessment Reports. It has been estimatedthat hot temperature extremes that would have occurred once in 50 years without
human influence are now about five-times more likely to occur (IPCC, 2023). In its mostrecent assessment report, the IPCC concludes that “the scale of recent changes acrossthe climate system as a whole […] are unprecedented over many centuries to many
thousands of years” (IPCC, 2023).

These extreme weather events take a very high large toll on people, ecosystems andeconomies. Almost 62 000 heat-related deaths were recorded in Europe in 2022. In
Pakistan, flooding in 2022 killed over 1 700 people, and damaged the lives of millions
more. In 2023, many months after the flooding, more than 8 million people still live nearcontaminated flood waters and are consequently exposed to disease. Health risks canalso occur indirectly, for example through smog from wildfires travelling large distances.
These events also cause serious financial damage and weaken economic prosperity. In
the United States, wildfires caused around USD 81.6 billion in damage from 2017 to 2021,
a nearly ten-fold increase over the previous five-year period, while the effects of thedroughts experienced in South America in 2023 are estimated to have reduced GDP in
Argentina in 2023 by three percentage points.
There is a rapidly closing window to secure a liveable and sustainable future for all. Deep,
rapid and sustained cuts in CO2 emissions to net zero can limit future warming, butsocieties will have to adapt to the effects of the climate change that is already happening.

2.1.3

Key mitigation levers

By mitigation measure
Meeting energy sector net zero emissions by 2050 requires using all available measures toreduce emissions (Figure 2.5). In the near term, almost all emissions reductions are deliveredby technologies and measures that are available, scalable and cost effective today.
First among these is the rapid deployment of solar PV and wind, which together account for
4 Gt of CO2 of emissions reductions by 2030. This is equivalent to the combined emissions of
the European Union, Japan and Korea today.

Fuel switching also contributes to emissions reductions through to 2030 in the NZE Scenario.
This includes switching from fossil fuels to additional renewable options such as bioenergy,hydropower, solar thermal and geothermal, as well as increasing the use of nuclear power
technology and switching from coal to natural gas. These measures together provide morethan 3 Gt of emissions reductions by 2030. Energy efficiency improvements of equipment,
66

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The next largest driver of emissions reductions is electrification. As the electricity sector isincreasingly decarbonised, it delivers emissions reductions through the expanding
deployment of technologies like EVs and heat pumps in buildings and light industries. In the
NZE Scenario, electrification both delivers significant energy demand savings and reduces
emissions by around 3 Gt by 2030. Measures such as more efficient end-uses of emissionsintensive materials and reduced material intensity of production also contribute to nearterm emissions reductions, as do behavioural changes on the part of consumers such as
reducing indoor temperatures and driving speeds on highways. This diverse portfolio of
measures cuts emissions by more than 2 Gt in 2030. Without such measures to reduce
wasteful material and energy use, the transition would be much more challenging (Box 2.3).

appliances, trucks, planes and building envelopes reduce emissions further by slightly lessthan 2 Gt. Hydrogen and CCUS take time to scale up even in the NZE Scenario, but together
they deliver a further 1 Gt of reductions by 2030.
Figure 2.5 ⊳CO2 emissions reductions by mitigation measure in the
NZE Scenario, 2022-2050

Gt CO₂Emission changes over time

Cumulative savings

40

100%

30

75%

20

50%

10

25%

2022

2030

2

Activity
Mitigation measures
Behaviour andavoided demand
Energy efficiency
Wind and solar PV
Bioenergy
HydrogenElectrification
Other fuel shifts
CCUS

2050
IEA. CC BY 4.0.

Expansion of solar PV, wind and other renewables, energy intensity improvements anddirect electrification of end-uses combined contribute 80% of emission reductions by 2030
Notes: Activity = energy services demand changes from economic and population growth. CCUS includes
BECCS and DACS.

For the period 2022 to 2050, the largest total contribution to emissions reductions in theenergy sector is from solar PV and wind, which account for 25% of all cumulative emissions
reductions in the NZE Scenario. In addition, measures to reduce demand through increased
energy efficiency, more efficient use of materials and behavioural change together accountfor a further almost 25%. Expanding electrification in the transport, industry and buildings
sectors provides 20% of abatement as electricity generation is progressively decarbonised.
Increased bioenergy and other fuel shifts account for slightly less than 20%, and hydrogenand CCUS account for slightly less than 15%.
Chapter 2 | A renewed pathway to net zero emissions

67

IEA. CC BY 4.0.

The outlook changes in the period to 2050. Getting emissions to net zero requires active
measures in emission-intensive sectors such as steel, cement and long-distance transport.
Together CCUS, hydrogen and hydrogen-based fuels account for one-fifth of emissions
reductions in the 2030 to 2050 period. The contribution made by electrification increases, as
EVs come to dominate the stock of not just cars and motorbikes but also trucks, and aselectrification expands further in the buildings and industry sectors. As a result,electrification accounts for nearly one-quarter of the emissions reductions seen in the 20302050 period.

Without behavioural changes, clean energy technologies would
have to accelerate even more rapidly

Box 2.3 ⊳Clean energy technologies are deployed at unprecedented speed in the NZE Scenario,
but many CO2-intensive energy assets will still be in use in 2030. Reducing their emissions
or replacing them depends on scaling up novel or complex low-emissions solutions anddeploying them around the world, and that will take time. In the NZE Scenario,
behavioural changes cut around 1 Gt CO2 from emissions-intensive assets which are stillin use in 2030. (Chapter 3 provides more details of what these changes are and how they
can be implemented).
In the absence of energy demand reductions from behaviour change, achieving the sameemissions reductions in end-uses would require ramping up low-emissions technologies
at staggering speed (Figure 2.6). In aviation, the use of sustainable aviation fuel (SAF)
would need to increase more than twice as fast as in the NZE Scenario, reaching about
4 exajoules (EJ) by 2030 and accounting for about 25% of the aviation fuel market. In roadtransport, the use of more EVs would require an additional 1.3 million tonnes (Mt) ofcritical minerals by 2030 – roughly the amount of critical minerals used in the EV sector
today. In buildings, heat pumps would need to provide about 35% of heating demand in
2030, whereas it is 20% in the NZE Scenario, meaning that heat pump sales would needto rise from 10% of all heating equipment sales today to 50% by 2026.
Energy transition levers with and without behavioural change
in the NZE Scenario

1.1

10%

Historical

NZE

1.0

2030

3

2022

20%

2010

1.2

2030

6

2022

30%

2030

2022

2010

1

1.3

9

2010

2

Heat pumps share
40%

2030

3

Cooling efficiency
1.4

Index = 2010

Critical minerals
12

2022

SAF

2010

4

Million tonnes

EJ

Figure 2.6 ⊳Additional without behavioural changes
IEA. CC BY 4.0.

Notes: SAF = sustainable aviation fuel. Cooling efficiency is measured as the ratio of service demand over
final energy consumption, which reflects efficiency of both building envelopes and equipment. Criticalminerals in this figure refer to the demand for battery manufacturing for EVs.

68

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Other mitigation levers offer alternatives to behavioural changes,
but the additional pace of uptake required would be very challenging

By technology readiness level
The share of emissions reductions in the NZE Scenario in 2050 from technologies at either
demonstration or prototype stage, i.e. not yet available on the market, has been reduced
from around half in the 2021 NZE Scenario to around 35% in the 2023 version (Figure 2.7).
Figure 2.7 ⊳2Comparison of CO2 emissions reductions in 2050 relative to baseyear by technology maturity in the 2021 and 2023 NZE Scenarios
20%

40%

80%

100%

Demonstration

Prototype

60%

NZE-2021

NZE-2023

Behaviour

MatureMarket uptake

IEA. CC BY 4.0.

Emissions reductions by 2050 from technologies in demonstration or prototype stage havebeen reduced from almost half in the 2021 NZE to around 35% in the 2023 NZE Scenario
Note: 2020 is the reference base year for the 2021 version of the NZE Scenario and 2022 is the base year forthe 2023 NZE Scenario.

This change reflects two factors in particular. First, there has been considerable progress on
clean energy innovation in the last few years, with important technology upgrades in several
sectors, including the commercialisation of a number of technologies (Figure 2.8). 6 Second,
there are differences in the rate of deployment for some clean technologies in the 2023
NZE Scenario relative to the 2021 version to reflect changing technology and market trends.
Key selected examples of changes since 2021 that are reflected in the 2023 NZE Scenario
include:Road transport: Today battery electric passenger cars and lithium-ion batteries aremuch more widespread than they were in 2021, and markets are maturing even though
they still need support in many cases. Cost reductions and standardisation for

information on technology development and progress, see: Tracking Clean Energy Progress(https://www.iea.org/reports/tracking-clean-energy-progress-2023) and the Clean Tech Guide, an interactive
database of over 550 individual technology designs and components across the whole energy system(https://www.iea.org/data-and-statistics/data-tools/etp-clean-energy-technology-guide).

Chapter 2 | A renewed pathway to net zero emissions

69

IEA. CC BY 4.0.

6 For morePower generation: Electricity generation from solar PV and wind in 2050 is 13% higher
in the 2023 NZE Scenario than in the 2021 version. This reflects the establishment ofcrystalline solar PV modules and onshore wind technology designs on the market, andincreases the scale of advanced designs such as floating offshore wind turbines. Long
duration storage is making progress through advances in battery technology anddemonstration projects in thermal and mechanical storage for power. On the other
hand, fossil fuel-based electricity generation from facilities equipped with CCUS – anarea currently with several technologies at demonstration stage – is moving more slowly
than projected in 2021. The contribution of CCUS to emissions reductions in power
generation by 2050 has been reduced by around 40% in the 2023 NZE Scenario.

Heavy industry: Recently there has been significant progress in 100% electrolytichydrogen-based direct reduced iron steelmaking, which accounts for nearly half of ironbased steel production by 2050 in the 2023 NZE Scenario. Progress is evident too in
cement production, both on carbon capture through indirect calcination, and on
alternatives to conventional raw materials and clinker. CCUS applications for a broad
range of chemicals are maturing from prototype to demonstration stages. Pilot projects
for full electrification of hydrocarbon cracking are making progress. The pipeline ofprojects for low-emissions ammonia production has expanded rapidly since 2021,
mostly electrolytic and some via steam methane reforming with CCUS. Progress is also
noted in batteries for heat storage, which could assist variable electricity generation toprovide constant high-temperature heat or high-pressure steam.



Non-road transport: Small electric aircraft for regional distance flights are close to being
demonstrated for the first time. Production of low-emissions aviation fuels is ramping
up. Large prototypes of ammonia-fuelled ships are being built, methanol-powered
container ships are being delivered, and small-scale hydrogen fuel cell ferries arestarting operations.

70

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

commercial lithium-ion batteries in particular have strengthened the business case forelectromobility over other options across all segments of road transport. The firstcommercialisation of cars powered by sodium-ion batteries was announced in China for2023; this technology was still at prototype stage in 2021. Other innovative battery
chemistries, for example with higher energy density for heavy-duty applications, areemerging, although some, such as solid-state batteries, are still at the prototype stage
and are experiencing delays in production. If delays persist, further advances in lithiumion battery technology might decrease the competitive advantage of these emerging
concepts and reduce their future role. Electric vehicle charging infrastructure isexpanding rapidly. Developments in ultra-fast electric charging and battery swapping aswell as hydrogen refuelling for heavy-duty vehicles are making some progress. Overall,
the decarbonisation of road transport in the 2023 NZE Scenario relies aroundten percentage points less on technologies under development in 2050 than the 2021
assessment. For example, the share of fuel cell electric heavy-duty vehicles on the roadin 2050 is 25-40% lower in the 2023 NZE Scenario than in the 2021 version, with theextent of the reduction varying by segment.

Figure 2.8 ⊳
11
10
9
8
Demonstration 7
6
Large
5
prototype4
Concept3
and small2
prototype1

Technology readiness level for selected technologies
relative to technology maturity targets in the NZE Scenario

MatureMarketuptake2025-2027

2025

2023

2023
2022

2022

2025-2028

2035

2
2023
2022
2021

2021

Sodium-ion
battery2028-2030

2021
2020

2022
2021

Solid oxide
Direct100%
Small modular
separation
reactors
H₂electrolyticelectrolysers CCS in cement
H₂-DRI
IEA. CC BY 4.0.

Accelerating clean energy innovation has delivered important technology upgradesin the last few years, although much remains to be done to achieve net zero pathways
Notes: H2 = hydrogen; DRI = direct reduced iron. For H2-based DRI steelmaking, R&D on incorporating hydrogen
into steelmaking has been taking place for decades, including at one commercial plant since the 1980s that
relies largely on hydrogen. However here we highlight specifically 100% electrolytic-H2 production. Futureyears shown in the graph refer to the year when a given technology reaches commercial operation in the NZE
Scenario.

Box 2.4 ⊳Announced manufacturing output for solar PV and batteries would
deliver around a third of all the emissions reductions required in the
NZE Scenario in 2030

Manufacturers are gearing up to supply rapidly rising demand (Figure 2.9). In 2022 alone,
total installed manufacturing capacity jumped by nearly 40% for solar PV and almost 60%
for batteries, of which most was for EVs with a small share for grid storage. The pipelineof announced projects is also skyrocketing. As of first-quarter 2023, total manufacturing
throughput from existing and announced projects in 2030 for both solar PV and batteries
would be about 75% higher than when considering announced projects as of the end of
2021. If all these projects proceed and are completed on time, production from existing

Chapter 2 | A renewed pathway to net zero emissions

71

IEA. CC BY 4.0.

Solar PV and batteries are two of the most critical technologies to decarbonise the energy
system. Together they deliver around one-third of the emissions reductions needed in
the NZE Scenario in 2030. In 2022, solar PV capacity additions and electric car sales – a
key driver of battery demand – expanded by rates equivalent to the average compound
annual growth needed to meet the requirements for 2030 in the NZE Scenario.

and announced manufacturing capacity would exceed demand in 2030 in the
NZE Scenario for solar PV, and just about meet demand for batteries.
Figure 2.9 ⊳Solar PV and battery manufacturing throughput, from existing
capacity and announced projects compared to deployment
in 2030 in the NZE Scenario
Solar PV

150%

Batteries

NZE 2030 deployment

100%

50%

As of 2021
Production

As of March 2023

ActualAs of 2021

With increased utilisation

As of March 2023
Announced projects
IEA. CC BY 4.0.

Massive growth in the last two years is apparent in both installed
and announced capacity for solar PV and battery manufacturing
Notes: Batteries include batteries for EVs and grid storage. ‘Increased utilisation’ indicates that utilisationof existing manufacturing capacity increases from actual rates to 85%. A utilisation rate of 85% is used forannounced projects. For 'As of March 2023', 'Actual' and 'With increased utilisation' are considering
production from existing capacity in 2022, and 'Announced projects' are as of the end of March 2023.

2.2

Energy trends

2.2.1

Total energy supply

Total demand for fossil fuels falls by slightly more than one-quarter, or 140 EJ, by 2030. Coalfalls the most at slightly less than 75 EJ reflecting the higher level of maturity of emissions
reduction technologies in electricity generation which today accounts for most coal use. This
72

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The NZE Scenario projects increasing use of low-emissions energy sources in place of
unabated fossil fuels (Figure 2.10). Between 2022 and 2030, low-emissions sources increaseby over 110 EJ, equivalent to the current total energy supply of the United States and Japancombined. Over the remainder of this decade, the increase in low-emissions energy sources
is led by modern bioenergy in its solid, liquid and gaseous forms. Wind and solar PV also
increase strongly, although the share in primary energy is not the best indicator to reflect
their role in the energy system given that they have lower conversion losses.

decline in coal demand is much less than in comparable scenarios assessed by the IPCC (seeBox 2.1). Oil demand declines by around 39 EJ. Natural gas drops the least, around 26 EJ,
partly reflecting its increasing use in combination with CCUS to produce hydrogen.
Figure 2.10 ⊳ Changes in total energy supply by source in the NZE Scenario,

2EJ

2022–2050

500

250

0

-250

-500

2022

2025

2030

2035

2040

2045

2050

Other
TUOB
Other renewables
Solar
Wind
Modern bioenergy
Hydro
Nuclear
Fossil fuel non-energy use
Natural gas: with CCUS
Oil: with CCUS
Coal: with CCUS
Unabated natural gas
Unabated oil
Unabated coal
Total energy supply
IEA. CC BY 4.0.

NZE Scenario relies on a huge increase in low-emissions sources of energy supply andenergy intensity improvements; demand for unabated fossil fuels declines by 2030
Notes: TUOB = traditional use of biomass. Unabated coal, oil and natural gas refer to the use of these fuels for
combustion purposes without CCUS.

The rising use of fossil fuels combined with CCUS is far smaller than the decline of unabatedfossil fuels. Unabated fossil fuel demand falls by around 150 EJ to 2030, while the use of fossil
fuels combined with CCUS increases by around 7.5 EJ to 2030, despite the strong push on
CCUS seen in the NZE Scenario (see Chapter 3).

After 2030 the pattern of energy supply continues to evolve rapidly and it is transformed by
2050. Solar, including solar thermal and solar PV, provides nearly 140 EJ in 2050, which isalmost equivalent to the total energy supply of unabated natural gas today. Modern
bioenergy provides around 100 EJ and wind around 85 EJ. Overall, renewable sources
provide more nearly three-quarters of total energy supply by 2050. Abated fossil fuels with
CCUS account for a further 5%. Unabated fossil fuels, excluding those used for non-energy
Chapter 2 | A renewed pathway to net zero emissions

73

IEA. CC BY 4.0.

Total energy supply is nearly 10% lower or 60 EJ in 2030 than in 2022, even with global
economic growth of over one-quarter. This implies dramatic progress in reducing energy
intensity from about 2% per year today to over 4% by 2030. Improving technical efficiency inappliances, motors and building envelopes is key, but a substantial portion of thisacceleration in intensity improvement results from a shift to more efficient energy carriers
such as electricity. Behavioural changes also contribute to reduced energy demand.

purposes, decline from around three-quarters of total energy supply in 2022 to around 5%
by 2050. Their emissions are offset through carbon removal technologies. In total, including
non-energy uses, fossil fuels account for less than one-fifth of total energy supply in 2050,
reversing their share today in which fossil fuels account for about four-fifths of total energy
supply, including non-energy uses.

Changes from the 2021 NZE Scenario
The 2023 NZE Scenario represents three broad differences in the composition of total energy
supply relative to the 2021 version (Figure 2.11).
Figure 2.11 ⊳ Changes in total energy supply by source in the 2021 andChange in percentage points

2023 NZE Scenarios in 2030 and 2050

8
6
4
2
0
-2
-4
-6
-8

2030

2050

Other
Traditional use of biomass
Other renewables
Solar
Wind
Modern bioenergy
Hydro
Nuclear
Fossil non-energy use
Natural gas: with CCUS
Oil: with CCUS
Coal: with CCUS
Unabated natural gas
Unabated oil
Unabated coal
IEA. CC BY 4.0.

The 2023 NZE Scenario projects slightly higher coal use in the near term and lower use of
CCUS, and a higher share of solar PV in total energy supply in the long term

Second, the long-term share of solar in total energy supply is higher than in the 2021 version(section 2.2.3). Third, the share of fossil fuels with CCUS, notably natural gas, is lower than in
74

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

First, unabated fossil fuels account for a somewhat higher share of total energy supply in
2030 than in the 2021 Net Zero Scenario version. For example, although unabated coal drops
by around 45% to 2030 compared to levels of use in 2022, its share in total energy supply in
2030 is four percentage points higher in the 2023 NZE Scenario than it was in the 2021
version. This reflects developments since the 2021 version, notably the unexpectedly strong
rebound in total energy demand post Covid-19 pandemic. It also reflects adjustments to thedesign of the scenario, which aims to give more time to emerging market and developing
economies to transition to clean energy (see Box 2.1). While coal and oil use in 2030 is higher
in the 2023 NZE Scenario than in 2021, natural gas use is somewhat lower because of energy
security concerns arising from the global energy crisis.

the 2021 NZE Scenario. This reflects a downward revision to hydrogen demand, caused inpart by boosted confidence in the possibility that direct electrification can play a larger rolein uses such as trucking. It also reflects a rebalancing towards electrolytic hydrogenproduction and away from production using natural gas with CCUS; this takes account of theslow pace of current progress on the development of CCUS. In the 2023 NZE Scenario,
reduced CCUS deployment is compensated by more renewables and electrification.

2.2.2

2

Fuel supply

Fossil fuels
Oil, natural gas and coal accounted for around four-fifths of total energy supply worldwide
in 2022. 7 The surge in clean energy investment in the NZE Scenario – from USD 1.8 trillion in
2023 to USD 4.5 trillion in the early 2030s – drives sharp declines in fossil fuel demand. The
share of fossil fuels in total energy supply drops below two‐thirds by 2030 and to less than
one-fifth in 2050. Coal demand declines by 45%, and oil and natural gas by around 20% to2030 (Figure 2.12).
Figure 2.12 ⊳ Oil, natural gas and coal supply by region in the NZE Scenario,
2010-2050

Oil (mb/d)

100

5 000

Natural gas (bcm)

80

4 000

6 000

60

3 000

4 500

40

2 000

3 000

20

1 000

1 500

2010
Asia Pacific2050
Middle East

2010
North America

2050
Eurasia

Coal (Mtce)

7 500

Africa2010
C & S America

2050
EuropeIEA. CC BY 4.0.

Declines in demand can be met without approving new, long lead time upstream
conventional oil and gas projects, new coal mines or mine lifetime extensions

7 Further information on oil and natural gas is forthcoming this year with the World Energy Outlook Special

Report: The Role of the Oil and Gas Industry in Net Zero Transitions.

Chapter 2 | A renewed pathway to net zero emissions

75

IEA. CC BY 4.0.

Note: mb/d = million barrels per day; bcm = billion cubic metres; Mtce = million tonnes of coal equivalent;
C & S America = Central and South America.

Coal demand falls quickly in the 2020s, declining by 7% on average each year to 2030 from
5 800 million tonnes of coal equivalent (Mtce) in 2022 to 3 300 Mtce in 2030 and less than
500 Mtce in 2050. Oil demand drops from 97 million barrels per day (mb/d) in 2022 to
77 mb/d in 2030 and 24 mb/d in 2050. Demand for natural gas falls from 4 160 billion cubic
metres (bcm) in 2022 to 3 400 bcm in 2030, and 920 bcm in 2050.
Just under 90 EJ of fossil fuels are consumed in 2050 in the NZE Scenario. One-third of this,including 60% of natural gas and 80% of coal, is used in facilities equipped with CCUS.
A further 40%, including 70% of oil, is consumed in applications where the carbon isembodied in the product and there are no direct CO2 emissions, e.g. chemical feedstocks,
lubricants, paraffin waxes and asphalt. The remaining 25% is used in sectors where clean
energy technologies are least feasible and cost effective, for example, oil accounts for around
20% of fuel use in aviation in 2050 in the NZE Scenario. The unabated combustion of fossil
fuels results in 1.4 Gt CO2 emissions in 2050 which are fully balanced by removal of CO2 fromthe atmosphere through BECCS and DACS.
The sharp decline in fossil fuel demand in the NZE Scenario means that no new conventional
long lead time oil and gas projects are approved for development after 2023, and that there
are no new coal mines or coal mine lifetime extensions. The pace of decline in oil and gas
demand in the 2030s may also mean that a number of high cost projects come to an end
before they reach the end of their technical lifetimes.
Investment in existing fossil fuel supply projects, however, is still needed in the NZE Scenario
to ensure that supply does not fall faster than the decline in demand. This includes the useof in-fill drilling and improved management of reservoirs as well as some enhanced oil
recovery and tight oil drilling to avoid a sudden near-term drop in supply. Investment is also
undertaken to reduce the emissions intensity of remaining fossil fuel operations, especiallyto tackle methane emissions and flaring. In the NZE Scenario, this leads to a 50% reductionin the global average GHG emissions intensity of oil and gas production between 2021 and
2030, and to almost zero emissions from oil and gas operations soon after 2040.
A large and sustained surge in clean energy investment is what removes the need for new
fossil fuel projects in the NZE Scenario: reducing fossil fuel supply investment in advance of,or instead of, policy action and investment to reduce demand would not lead to the sameoutcomes. Prolonged high prices would result if the decline in fossil fuel investment in this
scenario were to precede the expansion of clean energy and the action to cut overall energy
demand that are also set out in this scenario. This would reduce the chances of an orderlytransition to net zero emissions by 2050 and underlines the importance of action to secure
the kind of surge in investment in clean energy and the demand reductions that are seen in
the NZE Scenario.

Natural gas plays less of a role in the 2023 NZE Scenario than in the 2021 version. Natural gas
use is 10% lower in 2030 and 45% lower in 2050 than in the 2021 version. Price spikes in 2022
have shaken confidence in natural gas as an affordable alternative to coal or oil, especiallyamong some import-dependent emerging market and developing economies. Much less
76

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

What has changed since the 2021 NZE Scenario?

natural gas is also used to produce low-emissions hydrogen than was the case in the 2021
NZE Scenario.
On the supply side, additional oil and gas projects approved since the 2021 NZE Scenario arelikely to add around 4 mb/d and 170 bcm of production in 2030 (mainly in the Middle Eastand South America). This additional supply and the increased pace of reduction in natural
gas demand in the NZE Scenario in the 2030s and 2040s now means that some production isclosed before fields have reached the end of their technical lifetimes. Russia’s invasion of
Ukraine is also relevant here. The drop in Russian production to date (Russian natural gas
production in 2022 was 100 bcm lower than in 2021) is smaller than the additional
production from new projects that have recently been approved for development.
Governments are rightly concerned about energy security, but new conventional fieldapprovals cannot provide immediate relief for tight markets and may well make the laterstages of the transition even more challenging.

2

Low-emissions fuels
The supply of low‐emissions fuels, including modern bioenergy, hydrogen and hydrogen‐based fuels, increases rapidly in the NZE Scenario (Figure 2.13). They play an important role
in reducing emissions, notably those from long-distance transport and heavy industry. In the
NZE Scenario, demand for low-emissions hydrogen and hydrogen-based fuels rises fastest,
albeit from a low starting point, with an average annual growth rate of 80% to 2030 and 9%
between 2030 and 2050. However, in absolute terms, solid bioenergy also increases its
contribution to clean energy supply substantially. Demand for solid bioenergy increases by
15 EJ by 2030, equivalent to 500 Mtce.

EJ

Figure 2.13 ⊳ Low-emissions fuel demand in the NZE Scenario, 2010-2050
80

LiquidGaseous

Solid

60
40
20
2010

2050
Modern bioenergy

20102050 20102050
H₂ and H₂-based fuels
Transformation losses
IEA. CC BY 4.0.

Notes: H2 = hydrogen. Liquid, gaseous and solid refer to the phase of the fuel at the point of use or conversion.
Transformation losses are those incurred during conversion from one low-emissions fuel to another andexclude upstream energy losses associated with producing the converted fuel. Demand for hydrogen isinclusive of what is met by captive production onsite at industrial and refining facilities.

Chapter 2 | A renewed pathway to net zero emissions

77

IEA. CC BY 4.0.

Gaseous low-emissions fuels – including hydrogen – increase at the fastest ratein the NZE Scenario, but solid fuels increase nearly as much in absolute terms

Modern solid bioenergy is mostly used today for industrial purposes. By 2050, however,power generation accounts for 40% of the total, ahead of industry at 30% and inputs to liquidand solid biofuels at 20%. Around 24 EJ or 40% of current bioenergy consumption comesfrom the traditional use of biomass, but this is phased out by 2030 in the NZE Scenario as fullaccess to modern cooking technologies is achieved (see Chapter 3).
Modern liquid biofuel demand, including gasoline, diesel, marine and aviation fuels thatderive their energy content primarily from biogenic non-electricity sources, increases by
200% before peaking around 2040. Afterwards the continued phase-out of internal
combustion engine cars means that it is less in demand as a blending fuel for road vehicles,
and this reduction in demand outweighs steady increases in demand for maritime andaviation uses.
Gaseous bioenergy, including biogas and biomethane, becomes a highly valuable componentof the energy system in the NZE Scenario by 2030, notably in the power sector. This is in part
because it is the most cost-effective direct substitute for natural gas, an attribute that has
taken on a significant energy security dimension since the Russian invasion of Ukraine in early2022. By 2050, biogas from anaerobic digestors and other production techniques take on awide variety of roles because it offers one of the cheapest ways to meet rising demand forclean, gaseous fuels for flexible power generation, industrial heat, hydrogen production and,potentially, maritime fuel. In addition, they are able to provide sustainable carbon inputs tohydrogen-based fuels. However, the accessible resource base for biogas production islimited, which in effect rations its use.
Low‐emissions hydrogen production increases from 0.6 Mt (75 petajoules) today to 70 Mt in
2030 and 420 Mt in 2050. Of the low‐emissions hydrogen produced in 2050, 80% is produced
via water electrolysis, and nearly all the remainder from fossil fuels equipped with CCUS.
From around 1 GW today, the installed capacity of electrolysers reaches 590 GW in 2030, a
rate of growth that could be within reach if all the projects currently planned are taken
forward, including early stage projects. By 2050, 3 300 GW of electrolysis capacity and
15 000 terawatt-hours (TWh) of electricity are used to produce low-emissions hydrogen; theelectricity required is more than half of today’s total global electricity demand. Around 80%
of total hydrogen and hydrogen‐based fuel use in 2050 is for industry and transport, withroughly one third of total low‐emissions hydrogen in 2050 being converted to low-emissionshydrogen‐based transport fuels. Synthetic kerosene produced from hydrogen (andcombined with a non‐fossil fuel source of CO2) provides around 40% of energy use in theaviation sector, and ammonia and hydrogen provide more than 60% of energy use inshipping.

Overall, the level of low-emissions hydrogen in 2050 is broadly similar in the 2023 NZE
Scenario compared with the 2021 version, indicating that it retains its competitive position
as a leading option to reduce fossil fuel use in certain sectors. However, as support fromgovernments and potential low-emissions hydrogen users has not ramped up at the paceenvisaged by the 2021 NZE Scenario, the corresponding 2030 level has been adjusted
78

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

What has changed since the 2021 NZE Scenario?

downwards to reflect what can still be achieved this decade. In addition, the sources of lowemissions hydrogen have been somewhat rebalanced: the sluggishness of progress on CCUS
outside North America, coupled with a higher emphasis on reducing natural gas demand insome regions, has led to a reduction in the amount of hydrogen produced with fossil fuels
and CCUS in the NZE Scenario.

2.2.3

2

Electricity generation

Overview
Global electricity generation increases over two‐and‐a‐half‐times in the NZE Scenario from2022 to 2050, growing significantly faster over this period (3.5% per year) than over the past
decade (2.5%). The electrification of end-uses ranging from EVs to space heating to industrial
production, combined with economic development and population growth, drives thisgrowth and raises the share of electricity in final consumption from 20% in 2022 to almost
30% in 2030 and more than 50% in 2050. In addition, hydrogen production via electrolysis
increases rapidly in the NZE Scenario and accounts for almost 20% of global electricity
demand in 2050.
Figure 2.14 ⊳ Global electricity sector emissions and CO₂ intensity of
16
12

Emissionsg CO₂/kWh

Gt CO₂electricity generation in the NZE Scenario, 2010-2050
CO2 intensity

800

China

600

8

400

4

200

2050
2010
2030
Coal
Natural
gas
- 200
-4
Oil
Non-renewable waste
Bioenergy with CCUS

Other EMDE

Advanced
economies
2022

2030 2035 2040 2045 2050
Annual emissions:

1 Gt CO2
IEA. CC BY 4.0.

Electricity sector reaches net zero emissions in advanced economies
in aggregate in 2035, in China around 2040 and globally before 2045

Low‐emission sources of electricity – renewables, nuclear, fossil fuels with CCUS, hydrogenand ammonia – expand rapidly in the NZE Scenario, overtaking unabated fossil fuels just after
2025 and reaching 71% of total generation by 2030, almost twice the share in 2022.
Electricity sectors in advanced economies, in aggregate, reach net zero emissions by 2035 in
Chapter 2 | A renewed pathway to net zero emissions

79

IEA. CC BY 4.0.

Note: g CO2 /kWh = grammes of carbon dioxide per kilowatt-hour; other EMDE = emerging market anddeveloping economies excluding China.

the NZE Scenario, around 2040 in China and by 2045 in other emerging market anddeveloping economies (Figure 2.14). In each case, electricity is the first energy sector to reachnet zero emissions, creating opportunities for electrification in other sectors to further drive
down emissions.
The first of four key milestones for the electricity sector in the NZE Scenario is the tripling of
global renewables capacity by 2030 from the level of 3 630 GW in 2022 (Figure 2.15). This
leads to the share of renewables in electricity generation rising from 30% in 2022 to about
60% in 2030. By 2050 in the NZE Scenario, the total installed capacity of renewables is eighttimes the level in 2022, and it generates nearly 90% of global electricity supply.
Figure 2.15 ⊳ Key milestones for the electricity sector in the NZE Scenario,
2022-2050

30

Renewables(thousand GW)

20

10Grids investment
Fossil fuels unabated(Billion USD 2022, MER)
(thousand TWh)
18
1 200
Oil
Natural gas
800

900

x2

600

12

x2

Nuclear
(GW)

-95%

x3

300

6

400

2030
2040
2050

2022

2030
2040
2050

2022

2030
2040
2050

2022

2030
2040
2050

2022

Coal

IEA. CC BY 4.0.

Renewables capacity triples and grid investment doubles by 2030, unabated coal isphased out by 2040 in the NZE Scenario and nuclear capacity more than doubles by 2050

The second key milestone for the electricity sector is the doubling of grid investments by
2030. In the NZE Scenario, electricity transmission and distribution grids expand to meet thegrowing demands of electrification, connect thousands of new renewable energy projects,
and reinforce systems that need to adapt to changing system dynamics. Global annual
investment in grids to 2030 reaches USD 680 billion, and it remains at a high level through to2050. Close to 70% of this investment is for distribution grids with the aim of expanding,strengthening and digitalising networks. In addition to the scaling up of investment,
regulatory and policy reforms facilitate timely and efficient development and modernisationof grids to support clean energy transitions. 8

8 Electricity Grids and Secure Energy Transitions, a forthcoming IEA report, will be published in late 2023.

80

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The third key milestone for the electricity sector is a 95% reduction by 2040 in the unabateduse of fossil fuels to generate electricity which includes the complete phase out of unabatedcoal. Emissions from unabated coal were nearly 10 Gt CO2 in 2022, making up almost 75% of
the electricity sector total and 27% of total energy sector emissions. Despite a temporary
boost from the energy crisis, the share of unabated coal in global electricity generation falls
rapidly in the NZE Scenario from 36% in 2022 to 13% in 2030, and to zero by 2040 andbeyond. Coal phase-outs are already underway, and over 90 countries representing nearly
all coal-fired power in the world have either committed to phase out unabated coal
specifically or set net zero emissions targets (IEA, 2022a). Low‐emissions sources ofgeneration rise so rapidly that no new unabated coal plants beyond the 150 GW underconstruction at the start of 2023 are built in the NZE Scenario. Emissions from unabatednatural gas use for electricity generation were 2.8 Gt CO2 in 2022, contributing just over 20%
of electricity sector emissions, while oil use led to a further 0.5 Gt of emissions. Unabatednatural gas declines by over 80% by 2040 in the NZE Scenario, and large-scale oil-fired power
plants are fully phased out by then.

2

The fourth key milestone for the electricity sector is for nuclear power to more than double
from 417 GW in 2022 to 916 GW in 2050. Despite this growth, the share of nuclear power ingeneration declines slightly in the NZE Scenario from 9% in 2022 to 8% in 2050. After three
decades of modest growth, a changing policy landscape is opening opportunities for anuclear comeback. As a means of pursuing emissions reductions targets and addressing
energy security concerns, several countries have announced strategies that include asignificant role for nuclear power, including Canada, China, France, India, Japan, Korea,
Poland, United Kingdom and United States. At the start of 2023, nuclear reactors totalling
64 GW were under construction in 18 countries around the world. In the longer term, morethan 30 countries which accept nuclear power today increase their use of nuclear power in
the NZE Scenario.

China leads the way in nuclear power expansion, accounting for one-third of all new nuclear
capacity to 2050 in the NZE Scenario, with other emerging market and developing economies
accounting for almost another one-third. In advanced economies, where reactors have beenin operation on average for over 35 years, nuclear capacity additions rise over time largely
to offset the retirement of existing reactors, though lifetime extensions continue to play an
indispensable role as part of a cost-effective approach to achieving net zero emissions by
2050 (IEA, 2022b). All regions increasingly draw on advanced nuclear technologies, including
new large reactor designs (generation III+ and IV) and small modular reactors. While thebiggest opportunity for nuclear power is in the electricity sector, new nuclear power in this
scenario helps to decarbonise heat and to supply low-emissions hydrogen.

Chapter 2 | A renewed pathway to net zero emissions

81

IEA. CC BY 4.0.

To achieve the overall doubling of nuclear capacity by 2050, an average of 26 GW of new
capacity comes online every year from 2023 to 2050 in the NZE Scenario, some of which isneeded to offset retirements (Figure 2.16). This calls for average annual investment of over
USD 100 billion, which is triple the level in recent years. Following the completion of projects
already underway, the peak of expansion comes in the 2030s, when an annual average of33 GW of new nuclear capacity comes online, marking a new high for the nuclear industry.

Figure 2.16 ⊳ Nuclear power capacity and average annual capacity additionsin the NZE Scenario, 1990-2050

Advanced economies

China

2040s

2030s

2020s

2010s

2000s

1990s

8
1980s

200
2050

16

2040

400

2030

24

2020

600

2010

32

2000

800

1970s

Average annual capacity additions
40

1990

GW

Installed capacity
1 000

Other emerging market and developing economies
IEA. CC BY 4.0.

Nuclear power capacity more than doubles to over 900 GW by 2050,
with recent policy decisions opening opportunities for a nuclear comeback

Solar PV and wind are the leading means of cutting electricity sector emissions: their
combined global share of electricity generation increases from 12% in 2022 to 40% by 2030
and 70% by 2050. Solar PV additions expand almost fourfold to 820 GW by 2030, one-quarterof which is dedicated to the production of hydrogen. Wind additions reach 320 GW by 2030,
more than 30% of which is offshore, and with just over 10% of all wind dedicated to hydrogenproduction. Solar PV becomes the largest source of electricity by 2030 and holds that position
through to 2050; wind becomes the second-largest source (Figure 2.17).

In the NZE Scenario, natural gas‐fired generation peaks in the mid-2020s before starting along‐term decline. Even as output falls, however, natural gas‐fired capacity remains a criticalsource of power system flexibility in many markets, particularly to address seasonal flexibility
needs. Capacity additions of hydropower and other dispatchable renewables triple by 2030
to over 125 GW, expanding the supply of both low-emissions electricity and flexibility.
Stationary utility-scale battery storage is a relatively new source of flexibility, and it expands
36‐fold in the NZE Scenario by 2030. Batteries are well suited to provide power system
82

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Rising shares of solar PV and wind put a premium on power system flexibility and stability in
the NZE Scenario. Hourly flexibility needs quadruple between today and 2050 due to new
demand patterns and to the variable output of solar PV and wind. Seasonal variability also
increases in many regions in the NZE Scenario, calling on hydropower, low-emissions thermal
plants and new forms of long duration storage, including hydrogen. In addition, the highshares of inverter-based resources, such as wind, solar PV and batteries, increase systemstability challenges.

flexibility on the scale of seconds, minutes or hours, and can bolster the stability andreliability of electricity networks by providing fast frequency response. By 2030, global
utility-scale battery capacity reaches 1 000 GW in the NZE Scenario and accounts for about
15% of all dispatchable power capacity. Pumped hydro is already well established as animportant form of storage; other forms of storage, including thermal and gravity‐based
systems, are now under development. Expanding fleets of EVs and the increased
electrification of end-uses also provide increasing scope for demand response measures toprovide flexibility. Alongside this, the NZE Scenario sees the deployment of existing and newtechnologies to support system stability: these include synchronous condensers, flexible
alternating current (AC) transmission systems, grid-forming inverters and fast frequency
response capabilities.

2

Figure 2.17 ⊳ Total installed capacity and electricity generation by source
40

Installed capacity
Thousand TWh

Thousand GW

in the NZE Scenario, 2010-2050

30
20
10

40

Electricity generation

30
20
10

2010 2023 2030 2040 2050
Solar PV
Bioenergy and waste
Hydrogen and ammonia
Natural gas unabated

2010

Wind
Other renewables
Fossil fuels with CCUS
Oil

2030

2050

Hydro
NuclearCoal unabatedBatteries
IEA. CC BY 4.0.

Solar PV and wind lead decarbonisation of the electricity sector, becoming the largest
sources of electricity by 2030, complemented by nuclear and other low-emissions sources

The 2023 NZE Scenario includes a faster and larger increase in solar PV than the 2021 version(Figure 2.18). Solar PV capacity additions in 2030 are 30% higher than in the 2021 version,reflecting recent market acceleration and the rapid scaling up of manufacturing capabilities(see Chapter 1). Nuclear power expansion also proceeds more vigorously, with almost 15%
more capacity in 2050 in the updated NZE Scenario than in the 2021 version, reflecting
strengthened policy support in leading markets and brighter prospects for small modular
reactors. On the other hand, wind power increases less strongly in the 2023 NZE Scenario,
and 2030 capacity additions in 2030 are 20% lower than in the 2021 version due to limited
plans globally to expand manufacturing and challenging financial conditions across the
Chapter 2 | A renewed pathway to net zero emissions

83

IEA. CC BY 4.0.

What changed compared to 2021 NZE Scenario?

supply chain. Hydrogen and ammonia also play a smaller role than in the 2021 version as aresult of continuing high costs and competition for potential end-uses. The role of carbon
capture in reducing emissions from fossil fuel power plants has also diminished mainly due
to a lack of new projects.
Figure 2.18 ⊳ Global changes in electricity generation in the 2023 NZE
TWhScenario relative to the 2021 version, 2030 and 2050

10 000

Other renewables

8 000

Bioenergy with CCUS

6 000

Solar PV

Wind
Nuclear

4 000

Hydrogen and ammonia

2 000

Fossil fuels with CCUS

0Oil
Natural gas unabated-2 000-4 000Coal unabated
2030

2050
IEA. CC BY 4.0.

Recent developments in generation are included in the 2023 NZE Scenario with increases insolar PV and nuclear, and less wind, hydrogen, CCUS and BECCS than the 2021 version

2.2.4

Final energy consumption

Overview
Today, global total final energy consumption is 442 EJ. Emerging market and developing
economies account for 60% and advanced economies for 36%, with the remainder used inaircraft and ships for international travel and seaborne trade. Fossil fuels, led by oil, accountfor two-thirds of global total final consumption, electricity for a fifth and bioenergy 9 for atenth. The remainder is district heat, solar thermal, geothermal and non-renewable wastes
combusted in industrial processes.

9 Including renewable wastes.

84

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

By 2030, the share of fossil fuels in final consumption falls 9 percentage points in the
NZE Scenario, although they still account for more than half of the total (Figure 2.19). The
decline of fossil fuels is fastest in advanced economies, where their share in final
consumption falls by more than 15 percentage points to 2030 in the light of action to boost
EVs, heat pumps and modern bioenergy, and to moderate energy demand through energy
efficiency and behaviour change.

Figure 2.19 ⊳ Total final energy consumption by fuel and region in the
NZE Scenario, 2020-2050

Advanced economies

EMDE

International bunkers

EJ

150

2
100

50

2020
2050 2020
Unabated fossil fuels
Other fossil fuels
Modern renewables
Hydrogen and H₂-based

2050
2050 2020
Electricity
Traditional use of biomass
IEA. CC BY 4.0.

Use of unabated fossil fuels and traditional use of biomass plummets as more end-uses
switch to progressively decarbonised electricity and other low-emissions fuels
Notes: EMDE = emerging market and developing economies. Other fossil fuels include fossil fuels equippedwith CCUS and those used for non-combustion purposes, such as feedstock for chemicals production.

Floorspace in the buildings sector and the total road vehicle fleet both increase more than
15% globally by 2030, driven by emerging market and developing economies. The transitions
that take place in end-use sectors are somewhat slower in emerging market and developing
economies, with the share of unabated fossil fuels falling by 6 percentage points by 2030,
compared with a more than 15 percentage point drop in advanced economies. Universal
access to clean cooking and electricity is achieved by 2030, and 24 EJ of inefficient andpolluting traditional biomass is replaced by electricity, liquefied petroleum gases andefficient cookstoves.
After 2030, unabated fossil fuels are rapidly replaced in all countries by electricity, the direct
use of renewables – e.g. modern bioenergy, solar thermal and geothermal – and lowemissions hydrogen and hydrogen-based fuels. By 2050, global total final consumption
reaches around 340 EJ, of which electricity provides 53%. Electrification occurs in every
sector to provide, heating, cooling and mobility, to power motors and appliances, and to
produce onsite electrolytic hydrogen for heavy industries. Most of the small remaining
quantities of unabated fossil fuels used for combustion applications, around 15 EJ globally in
2050, are consumed in long-distance transport, especially aviation and shipping, and in heavy
industries.

In the industry sector, the 2023 NZE Scenario envisages a smaller role for CCUS than the 2021
version (Figure 2.20). Despite multiple CCUS project announcements for specific industrial
Chapter 2 | A renewed pathway to net zero emissions

85

IEA. CC BY 4.0.

What changed compared to 2021 NZE Scenario?

applications like cement, the plants involved collectively only account for a small share of
total production (see Chapter 3). Moreover, there has been little progress in CCUS in the ironand steel industries. In contrast, the number of project announcements for hydrogen-based
direct reduced iron (DRI) steel production increased significantly since 2021, which isreflected in the four percentage point increase in the share of iron production in 2035
between the two versions of the NZE Scenario.
Figure 2.20 ⊳ Fuel mix changes in final energy consumption by sector
in the 2023 NZE Scenario relative to the 2021version,
2030 and 2050

8%

Industry

Transport

Buildings

4%
0%
-4%
-8%

2030

2050

Coal: unabatedOil: with CCUS
Fossil fuels: non-energy use
Hydrogen and H₂-based fuels
Other renewables

2030

2050

Coal: with CCUS
Natural gas: unabatedElectricity
Traditional use of biomass
Non-renewable waste

2030

2050

Oil: unabated
Natural gas: with CCUS
District heat
Modern bioenergy
IEA. CC BY 4.0.

Better prospects for heat pumps, EVs and hydrogen-based steel production drivestronger electricity demand, while synthetic fuels, liquid biofuels and CCUS are reduced

In the transport sector, the key change compared to the 2021 NZE Scenario version is faster
growth in EV sales. It reflects the very strong advances in terms of annual sales, announced
manufacturing capacity for batteries, strategy announcements from car and truck makers,
and technology improvements. Biofuel use in transport, however, has not advanced in asimilar way, reflecting that food and fertiliser prices remain a concern. EV technologies andmanufacturer strategies have advanced in trucks, a segment of the market that is particularly
conducive to the use of biofuels, particularly in the short term. As a result, the 2023 NZE
Scenario sees a diminished role for biofuels in transport in both the near and longer term.
A similar downward revision also applies for hydrogen and hydrogen-based fuels. In the near
86

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Note: Where low-emissions hydrogen is produced and consumed onsite at an industrial facility, the fuel input,
such as electricity or natural gas, is reported as final energy consumption, rather than the hydrogen output.

term this results in a slightly higher share of oil in transport energy demand, in the longer
term it leads to even higher levels of EV sales share and to a substantially higher share ofelectricity in transport energy demand by 2050.
In the buildings sector, the main change is a faster switch from natural gas to electricity whichprimarily reflects advances in heat pump technology and concerns about natural gas supply
in the wake of Russia’s invasion of Ukraine.

2

Industry
Energy and materials efficiency measures are important levers to reduce industrial CO2
emissions in the short term. Examples include the deployment of best available technologies
to reduce energy consumption, waste heat recovery and process integration, building andproduct lifetime extensions, recycling, and product designs that are less material-intensive
and that facilitate component repair and reuse. These measures are generally incremental
in impact, and there are practical limits to what they can do to mitigate emissions. Stepchanges in the emissions intensity of production – particularly of emissions-intensive bulk
materials like steel, cement and primary chemicals – are still required, and these are achievedin large part by the use of hydrogen, CCUS and direct electrification technologies.
Figure 2.21 ⊳ Final energy consumption by fuel in selected industry
60

Steel

CementChemicals

Other industry

3

40

2

20

1

202220302050
Coal: unabatedOil: with CCUS
Fossil fuel: feedstock
HydrogenNon-renewable waste

202220302050

202220302050

Coal: with CCUS
Natural gas: unabatedElectricity
Modern solid bioenergy
Emissions (right axis)

Gt CO2EJ

sub-sectors, 2022-2050

202220302050
Oil: unabated
Natural gas: with CCUS
Heat
Other renewables
IEA. CC BY 4.0.

Notes: Where low-emissions hydrogen is produced and consumed onsite at an industrial facility, the fuel input,
such as electricity or natural gas, is reported as final energy consumption, not the hydrogen output. Other
industry category includes light industries and non‐specified industry. CO2 emissions from chemicals do notinclude CO2 removal from onsite direct air capture.

Chapter 2 | A renewed pathway to net zero emissions

87

IEA. CC BY 4.0.

Net zero emissions in industry relies heavily on electricity, hydrogen and CCUS. Unabatedfossil fuel use plummets while petrochemical feedstock demand decreases more slowly.

Most of the remaining industry sector energy-related emissions are addressed by using
alternatives to fossil fuels to provide heat. Chief among these alternatives is electricity, which
is used primarily to provide low-temperature heat, which increases its share of industrial
energy consumption from 23% in 2022 to 49% in 2050 (Figure 2.21). Hydrogen and bioenergy
are used in the NZE Scenario to provide high-temperature heat.

Transport
Electrification is the main lever for emissions reductions in road transport in the NZE Scenario(Figure 2.22). EV sales account for around 65% of the new car market by 2030, and no newinternal combustion engine (ICE) cars are sold after 2035. Electric and hydrogen-fuelled
trucks displace ICE medium and heavy trucks: new fossil-fuelled ICE truck sales end in 2040
in advanced economies and China, and in 2045 in the rest of the world. Battery electric trucks
make significant advances, particularly in medium-duty trucks and other trucks withrelatively short and regular routes; fuel cell electric powertrains are most successful in longhaul, heavy-duty trucks where fast charging of battery electric versions may prove difficult.
These changes mean that oil demand for road transport – the single largest oil consuming
sector today – falls at an average 1.4 mb/d per year to 2050.
Figure 2.22 ⊳ Final energy consumption in transport by fuel forLight duty vehicles

Heavy trucks

Aviation

Shipping

4.5

Oil

Natural gas

CoalElectricity

Bioenergy

Hydrogen

2050

2030

2022

2050

2030

2022

2050

2030

1.5

2022

20

2050

3.0

2030

40

Gt CO2

60

2022

EJ

selected modes, 2022-2050

Emissions (right axis)
IEA. CC BY 4.0.

Road transport relies strongly on electrification to substitute its oil thirst, whereas aviationand shipping oil substitutes are mainly liquid biofuels, hydrogen and synthetic fuels

Aviation sees strong growth in emerging market and developing economies, but traffic
optimisation measures, energy efficiency gains, behavioural changes and rapid developmentof bio-based SAF mean that aviation oil demand peaks in the mid-2020s in the NZE Scenario.
88

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Notes: Only direct CO2 emissions are included. Hydrogen includes hydrogen-based fuels.

After 2030, oil use decreases rapidly – by more than 0.2 mb/d per year on average – with thedevelopment of synthetic SAF and the deployment of the first hydrogen aircraft in thesecond-half of the 2030s. In shipping, efficiency improvements including the use of windassistance and fuel switching cut oil use. Ammonia is the primary low-emissions fuel used todecarbonise shipping, with the contributions from biofuels and hydrogen limited in large partby their relatively high costs.

2

Buildings
Making buildings zero-carbon-ready 10 means that existing buildings need to undergo deep
retrofits and that new buildings need to meet very stringent standards and be equipped withtechnologies that will be fully decarbonised by 2050. In the NZE Scenario, the global average
retrofit rate reaches 2.5% per year by 2030 and remains at around that level through to 2050.
This leads to around half of existing buildings being retrofitted and becoming zero-carbonready by 2040. This in turn more than halves demand for space heating and cooling between
today and 2050, despite a 55% increase in the amount of floorspace in the buildings sector.
Figure 2.23 ⊳ Final energy consumption in the buildings sector by
Space heating

Cooking

Water heating

Space cooling3

Coal
Traditional use of biomass
District heat

Natural gas
Electricity
Renewables

2050

2030

2022

2050

2030

2022

2050

2030

1

2022

15

2050

2

2030

30

Gt CO2

45

2022

EJ

selected end-use, 2022-2050

Oil
HydrogenEmissions (right axis)
IEA. CC BY 4.0.

Deep retrofits and efficient devices lower energy intensity in buildings by 60% compared
to today; electricity, district heat and direct renewables displace fossil fuels by 2050
Note: Only direct CO2 emissions are included.

10 Zero-carbon-ready buildings become zero-carbon without any further renovation once the power andnatural gas grids that they rely on are fully decarbonised.

Chapter 2 | A renewed pathway to net zero emissions

89

IEA. CC BY 4.0.

The use of fossil fuels for heating and cooking is rapidly reduced in the NZE Scenario in favourof electricity and clean energy alternatives (Figure 2.23). In emerging market and developingeconomies, traditional use of biomass is replaced by modern energy use as universal accessto clean cooking is achieved by 2030. From 2025 onwards, sales of new coal and oil boilers
come to an end (gas boilers continue to be used in a minority of cases, fuelled by biomethaneand hydrogen). They are largely replaced by heat pumps with 290 million dwellings equippedwith heat pumps by 2030 and 875 million by 2050. Solar water heaters are also deployedextensively with 350 million dwellings equipped with solar thermal for water heating by 2030
and around a billion by 2050. The use of biomethane in buildings reaches 75 bcm of natural
gas equivalent by 2050, and district heating is virtually fully decarbonised by 2050.

2.3

Net zero emissions guide90International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Our 2021 Net Zero by 2050 report included numerous tables presenting more than 400 key
milestones for different sectors and technologies on the pathway to reach net zero emissions
from the global energy sector by 2050. These proved to be highly useful for numerous
stakeholders, including actors from industry, finance, and policymaking. In this year’s edition,
we have brought together these milestones in one place as a set of fifteen technology andsector-specific dashboards. These are presented in the pages that follow. Clarificatory notes
to the dashboards are given on page 106.

34%

Low-emissions sources of electricity

OF CUMULATIVEEMISSIONSREDUCTIONS

Renewables capacity triples by 2030 led by solar PV and wind, complemented by
growth in nuclear and other sources, raising the share of low-emissions sources inelectricity generation from 39% in 2022 to 71% in 2030 and nearly 100% in 2050.

Low-emissions electricity generation capacity by source
Thousand GW

40

Over 70% of electricity from wind and solar PV
Nearly 90% of electricity from renewables

30

Over 65% increase in nuclear power capacity
20

40% of electricity from wind and solar PV
Wind and solar additions reach 1 140 GW

10

2030

2010
Solar PV

Wind

Other renewables

Nuclear

2035

2050

Fossil fuels with CCUS, hydrogen and ammonia

Milestones

2022

2030

2035

2050

Total electricity generation from low-emissions sources (TWh)

11 28127 06143 11776 603

Solar PV and wind

3 416

15 24727 36254 679Other renewables

5 183

7 284

9 377

13 752

Nuclear

2 682

3 936

4 952

6 015

39%

71%

91%

99.7%

Share of solar PV and wind in total generation

12%

40%

58%

71%

Share of renewables in total generation

30%

59%

77%

89%
1 268

Share of low-emissions sources in total generation

344

1 301

1 382

Solar PV

220

823

878

815

Wind

75

318

350

352

8

35

37

21

Annual capacity additions of low-emissions sources (GW)

Nuclear2017-22 2023-30

Average annual investment (USD billion 2022, MER)

2031-35 2036-50

Low-emissions

507

1 202

1 321

973

Renewables

466

1 080

1 185

875

41

114

121

93

Nuclear

Solar PV and wind account for 65% of the global
power sector CO2 emissions reductions by 2050
2030

2035

2040

2045

2050
Billion USD (2022, MER)

2025

-7
Gt CO2

Scaling up investment in electricity infrastructureis critical to unlock clean energy transitions-14
Solar PV
Wind
Other renewables
Nuclear
Fossil fuels with CCUS, hydrogen and ammonia

400

Advanced economies
Transmission
Distribution
Emerging market anddeveloping economies

200

Transmission
Distribution

2010-16

Chapter 2 | A renewed pathway to net zero emissions

2017-232024-30

91

Unabated fossil fuels in electricity generation
Electricity output from unabated fossil fuels falls by 40% to 2030 and virtuallydisappears by 2050, as plants are run less, retired, retrofitted with CCUS or repurposed
to use low-emissions fuels.

95%

REDUCTION
BY 2040

Thousand TWh

Unabated fossil fuels electricity generation
25

No new unabated coal power
plants approved for development

20

Hydrogen and ammonia start to co-fire with natural gas and coalPhase out of unabated coal in advanced economies
Phase out of all large oil-fired power plants

Oil

15

Phase out of all unabated coal
Unabated natural gas below 5% of generationtural gas

Unabated na

10

Nearly all remaining plants retrofitted with CCUS
or fully converted to use low-emissions fuels

5

Unabated coal20102023 2025

2050

2040

2030s

Milestones

2022

2030

2035

2050

Total electricity generation from unabated fossil fuels (TWh)

17 636

11 066

4 241

158

Coal

10 427

4 988

1 379

0

Natural gas

6 500

5 943

2 834

158
0.2%

Share of unabated fossil fuels in total generation

61%

29%

9%

Coal

36%

13%

3%

0%

Natural gas

22%

16%

6%

0.2%

Coal and gas plants equipped with CCUS (GW)

0.12

50

141

241

Average ammonia blending in global coal‐fired generation (without CCUS)

0%

1%

11%

100%

Average hydrogen blending in global gas‐fired generation (without CCUS)

0%

5%

16%

79%

Average biomethane blending in global gas‐fired generation (without CCUS)

0.1%

1%

1%

7%

Retrofits and blending

2017-22 2023-30

Average annual capacity retirements (GW)
Coal

27

110

81

43

Natural gas

8

39

43

46

CCUS retrofits and blending low-emissions fuels
enable coal- and gas-fired power plants tocontribute to energy transitions

Reducing coal-fired power in EMDE accounts for
60% of global power sector emissions reductions

2 500

2025 2030 2035 2040 2045 2050 Advanced economies

1 250

Emerging market anddeveloping economies

Coal
Natural gas
Oil

-7

2023
CCUS

92

Hydrogen2030
Biomethane

2050
Ammonia

Coal
Natural gas
Oil

Gt CO2

Electricity generation (TWh)2031-35 2036-50-14International Energy Agency | Net Zero Roadmap

16%Road transport

OF CUMULATIVEEMISSIONSREDUCTIONS

Ramping up electrification and biofuels plays a major role to decarbonise road transport
to 2030. Thereafter, electrification is the prominent lever, with electricity representing
three-quarters of energy consumption in road transport in 2050.

Fuel shares of road energy consumption
Cars and vans

100%

Buses

Heavy trucks

50%

2010

2022

2030
Oil

2050

2010

Natural gas

Biofuels

2022

2030

Electricity

2050

2010

Hydrogen

Synthetic fuels

Milestones

2022

2030

2050

2022

2030

2035

2050

13%

70%

98%

100%

Two/three-wheelers

16%

78%

100%

100%

Cars and vans

13%

67%

100%

100%

Sales share of plug-in hybrid, battery and fuel cell electric vehicles

Buses

4%

56%

90%

100%

Heavy trucks

1%

37%

65%

100%

Alternative fuel shares

5%

20%

36%

93%

Biofuels

5%

11%

12%

3%

Electricity

0%

8%

22%

74%

Hydrogen

0%

1%

2%

16%

Fuelling infrastructure
Electric vehicle public charging points (million)

3

17

18

31

Hydrogen refuelling stations (thousand)

1

12

15

46

60

Road transport emissions drop dramaticallyto 2030, particularly in advanced economies
Gt CO2

Billion USD (2022, MER)

Investments in public chargers scales up, first forcars and vans, then for heavy trucks and buses

2.5
2.0
1.5

30

1.0
0.5
2022

2030 2035

Cars and vans

Heavy trucks and buses

2050

2010

Advanced economies

2022

2050

Emerging market and developing economies

Chapter 2 | A renewed pathway to net zero emissions

93

5%

Shipping and aviation
Bioenergy, hydrogen and hydrogen-based fuels ramp up from less than 1% of energy
consumed today in shipping and aviation to almost 15% in 2030 and 80% by 2050.
Also important to decarbonise these transport modes are energy efficiency improvements
in shipping to 2030 and behaviour-driven demand reduction in aviation to 2050.

EJ

Shipping energy consumption

OF CUMULATIVEEMISSIONSREDUCTIONS

Aviation energy consumption

18

24%

12

16%

6

8%

2015 2020 2022

2030

2040

2050

2015 2020 2022

2030

2040

2050

Fossil fuels
Biofuels
HydrogenAmmonia
Methanol
Synthetic kerosene
Electricity
Avoided consumption from behavioural measures (right axis)

Milestones

2022

2030

2035

2050

125

145

165

265
19%

Shipping
International shipping activity (trillion tonne-kilometres)
Share in final energy consumption
Biofuels

0%

8%

13%

Hydrogen

0%

4%

7%

19%

Ammonia

0%

6%

15%

44%

Methanol

0%

1%

1%

3%

International and domestic aviation activity (trillion passenger-kilometres)

6.0

10.9

11.4

16.5

Avoided demand from behavioural measures

0%

9%

14%

20%

Biofuels

0%

10%

22%

33%

Synthetic hydrogen-based fuels

0%

1%

4%

37%

Aviation

Share in final energy consumption

Ammonia engines
for vessels

2020

2030

2040 2045

Hydrogen bunkering
for vessels

CO2 emissions from shipping and aviation decrease
more rapidly in advanced economies
Mt CO2

Technologies are being developed to enable the useof low-emissions fuels in shipping and aviation

600

Aviati
on
300

Ship

Batteryelectric aircraft
Synthetic
aviation fuels
Small prototype or concept

94

ping

2022

NZE
Large prototype

Market uptake

2050
Emerging market and developing economies
Advanced economies

International Energy Agency | Net Zero Roadmap

6% Steel
1% Aluminium

Steel and aluminium

OF CUMULATIVEEMISSIONSREDUCTIONSEmissions reductions from steel and aluminium production are challenging due toa heavy reliance on fossil fuels today, process emissions from incumbent routes
and high trade exposure. Increased scrap recycling and mass deployment ofinnovative technologies are key levers for reducing emissions.

Gt CO2Emissions reductions by mitigation measure
Steel

3

+13%

+11%
2

Aluminium

0.3

+16%

+12%
0.2

-27%

1

-27%

0.1
-90%
2022
Activity increase

-97%

2030

2050

Mitigation measures:

Avoided demand
Energy efficiency
Electrification
Other processes shifts

2022

Milestones

2030

2050

Hydrogen-based
Other fuel shifts

CCUS

2022

2030

2035

2050

Steel
Crude steel production (Mt)

1 880

1 970

1 970

1 960

Share of scrap in metallic inputs

33%

38%

40%

48%

Share of near zero emission iron production

0%

8%

27%

95%

CCUS-equipped

0%

3%

10%

37%

Electrolytic hydrogen-based

0%

5%

15%

44%

Iron ore electrolysis

0%

0%

2%

14%

CO2 captured (Mt CO2)

1

27

131

399

Low-emissions hydrogen demand (Mt)

0

6

17

41

Aluminium
Aluminium production (Mt)

108

120

128

146

Share of secondary production

36%

42%

44%

56%

Share of near zero emission primary aluminium production

0%

7%

19%

96%

Share of low-emissions thermal energy in alumina production

0%

16%

39%

99%

Iron production (Mt)

Announced projects meet 12% of 2030 near zero
emission iron production needs; ‘capable’ capacity
needs clear decarbonisation plans
100

Emissions intensities drastically improve and scrap
metal use increases
3
Direct t CO2
per t material
2022

50

2030

2040

2050

Steel

Aluminium

Scrap share ofmetallic inputs
Near zero
emission
EuropeNear zero
emission capable

North America

Asia

Gap withNZE Scenario

Rest of world

Total

75%
Advanced economies:
Steel
Aluminium
Emerging market and developing economies:

Chapter 2 | A renewed pathway to net zero emissions

95

6%

CementOF CUMULATIVEEMISSIONSREDUCTIONS

Cutting emissions from cement production is difficult due to the present reliance on
carbon-containing raw materials and high-temperature heating requirements. Energy
and material efficiency, and low-emissions fuels are key measures in the near term.
Deep reductions require a massive roll out of innovative technologies such as cements
made with alternative raw materials and CCUS.

Gt CO2Emissions reductions by mitigation measure
3
+7%
+7%

2

-26%

1

-96%
2022

2050

2030

Activity increase

Mitigation measures
Material efficiency

Energy efficiency

Bioenergy

HydrogenElectrification

Other fuel shifts

CCUS

Milestones

2022

2030

2035

2050

Cement production (Mt)

4 160

4 260

4 140

3 930

Clinker-to-cement ratio (tonne per tonne)

0.71

0.65

0.61

0.57

Kiln thermal energy intensity (GJ per tonne of clinker)

3.6

3.4

3.3

2.9

Share of near zero emission clinker production

0%

8%

27%

93%

CO2 captured (Mt CO2)

0

170

480

1 310

Share of low-emissions fuel in thermal energy use

5%

30%

49%

86%

Bioenergy without CCUS

5%

15%

17%

19%

Bioenergy with CCUS

0%

2%

8%

19%

Fossil fuels and non-renewable waste with CCUS

0%

10%

22%

31%

Hydrogen

0%

1%

3%

9%

Electricity

0%

0%

0%

8%

200
150
100
50
Announced

1.0

Em
de ergve inlop g ming arAd
ec ket
va
on an
nc
om d
ed
ies
ec
on
om
ie
s

0.5

NZE

Advanced economies
Emerging market and developing economies

96

Advanced economies move first, but most of thechallenge lies in emerging market and developing
economiest CO2 per t clinker

Mt CO2 captured

Announced CCUS projects fall short of 2030 target

2010

2022

2030

2040

International Energy Agency | Net Zero Roadmap

2050

3%

Primary chemicals

OF CUMULATIVEEMISSIONSREDUCTIONS

Increases in plastics recycling and more efficient fertiliser use dampen rising demand forprimary chemicals and energy consumption for their production. Electrolytic hydrogen,
CCUS and direct electrification technologies are key to deliver the step changes inemissions intensities needed for primary chemical production.
Emissions reductions by mitigation measure
Gt CO2

1.0
+8%

+7%
-21%
0.5

-96%
2022
Activity increase

2050

2030
Mitigation measures
Avoided demand

Energy efficiency

HydrogenMilestones

Electrification

Other fuel shifts

CCUS

2022

2030

2035

Primary chemicals production (Mt)

719

861

905

878

Share of near zero emission primary chemicals production

2%

17%

39%

93%

CCUS-equipped

2050

0.5%

8%

22%

56%

Electrolytic hydrogen-based

0%

7%

13%

28%

Other

1%

2%

4%

9%

CO2 captured (Mt)

4

52

143

344

Hydrogen demand (Mt)

48

53

55

60

Plastics recycling
Share of plastics waste collected

16%

24%

31%

51%

Share of secondary production

8%

13%

18%

35%

Primary chemicals savings (Mt)

9

25

42

116

70

Higher use of coal in emerging market anddeveloping economies makes the path to net zero
more challenging
t CO2 / t primary chemicals

Primary chemicals
production (Mt)

Announced projects for net zero emission
production are increasing, but more efforts areneeded to close the gap with the NZE in 2030

35

Existing

Announced

Electrolytic hydrogen-based

Gap with NZE 2030

2

E
de mer
ve gi
lo ng
pi m
ng a
Ad
ec rkeva
on t a
nc
ed
om nd
ec
ie
on
s
om
ies

1

2010

2022

2050

CCUS-equipped

Chapter 2 | A renewed pathway to net zero emissions

97

4%

Space heating

OF CUMULATIVEEMISSIONSREDUCTIONSSpace heating energy consumption in buildings decreases by almost 70% by 2050 evenwith a 30% increase in heated floor area thanks to zero-carbon-ready buildings energy
codes and increasingly efficient equipment.

EJ

Space heating energy consumption
60

40

20

2010

2015

2022

Energy consumption:

Fossil fuels

Avoided consumption:

Energy efficiency

2030

District heat

2050

Electricity

Modern bioenergy

Solar thermal

Other

Behavioural change

Milestones

2022

2030

2035

2050

Heat pumps installed in buildings (GW)

1 000

3 000

4 400

6 500

12%

25%

40%

55%

In new buildings and deep renovations

<1%

100%

100%

100%

In existing building stock

<5%

20%

35%

80%

Retrofit rate in advanced economies

<2%

2.5%

2.5%

2.5%

Heated floor area (billion square metres)

157

170

180

200

Share of space heating service demand met by heat pumps
Share of buildings that are zero-carbon-ready

1

150

0.5

2010

2015

2022

98

3 000

1 500

d
rket an s
ing maEmerg ing economiepdeveloAdvanced economies

2030

Non-ZCRB
Non-compliant Compliant:Heating energy intensity (right axis)

Global heat pump stock nears 3 000 GW in 2030,
almost tripling today’s capacity
GW

300

Index (1 = 2010)

Billion square metres

Share of zero-carbon-ready buildings expands
rapidly and by 2030 those standards are met in all
new buildings

ZCRB

2010

2022

International Energy Agency | Net Zero Roadmap

2030

4%

Space cooling

OF CUMULATIVE
ENERGY SAVINGSSpace cooling energy consumption is set to more than double by 2050 with no action
taken. Passive designs, behavioural change and more efficient equipment are vital totemper demand growth and reduce the strain on electricity systems.

EJ

Space cooling energy consumption
20

10

2010

2015

2022

2030

Energy consumption:

Advanced economies

Avoided consumption:

Energy efficiency

2050

Emerging market and developing economies
Behavioural change

Milestones

2022

2030

2035

Cooled floor area in buildings (billion square metres)

105

140

170

2050
250

Share of households with air conditioners

36%

45%

50%

60%

Installed capacity of space cooling equipment (GW)

850

1 400

1 750

2 700

Share of space cooling in final electricity consumption

9%

7%

6%

5%

In new buildings and deep renovations

<1%

100%

100%

100%

In existing building stock

<5%

20%

35%

80%

3.5-4.5

5.0-6.5

6.5-8.0

7.5-9.0

Share of buildings that are zero-carbon-ready

Average efficiency of new space cooling equipment (Watt-hour/Watt-hour)

300

Space cooling energy intensity from 2022 to 2050
decreases twice as fast as the last decade
Index (2010 = 1)

Billion square metres

Cooled floor area more than doubles by 2050, withadditions principally occurring in EMDE

150

1.0
Emer
g
deve ing markelopin
g eco t and
nomie
s

0.5

Adv
a

nce

ket and
Emerging mar
omies
on
ec
ing
lop
deve

d ec

ono

mie

s

Advanced economies
2010

2022
Existing

2050

2010

2022

2050

New

Chapter 2 | A renewed pathway to net zero emissions

99

11%

Energy efficiency and behavioural change

OF CUMULATIVEEMISSIONSREDUCTIONS

Scaling up energy efficiency, behavioural change and fuel switching are key todouble the rate of energy intensity improvements by 2030, as current measures leadto only marginal progress.

Average annual rate of total energy intensity reduction by contributor
5%
Avoided demand
4%
Fuel switching
3%

Power
Buildings
Transport
Industry

Clean cooking
Technical efficiency

2%

Electrification
and renewables

1%

2022

2030

Milestones

2022

2030

2035

2050

Annual energy intensity improvement

2.0%

4.9%

3.6%

1.8%

Unit electricity consumption of new air conditioners (index 2022 = 100)

100

70

59

52

Unit electricity consumption of refrigerators (index 2022 = 100)

100

60

53

41

Fuel consumption of new internal combustion engine trucks (index 2022 = 100)

100

84

79

Energy intensity of clinker production (GJ/t)

3.6

3.4

3.3

Key behavioural changes in buildings and transport• Eco-driving and motorway speed limits of 100 km/h introduced by 2030
• Use of internal combustion engine cars phased out in large cities by 2030
• Space heating temperatures moderated to 19-20 °C and space cooling temperatures to 24-25 °C on average by 2030
• One-out-of-two long-haul business flights are avoided by 2040

Efficiency standards cover 90% of energy use forkey appliances but other uses lag
100%

Energy use covered by efficiency standards

Reductions of energy demand from behaviouralchanges are nearly five times higher per capita in
2030 in advanced economies
Advanced economies

Emerging market anddeveloping economies

50%

2010
Refrigeration
Road transport

100

2023
Space coolingIndustrial motors

GJ/capita

-5

-10
Road

Aviation

Buildings

Industry

International Energy Agency | Net Zero Roadmap

2.9

4%

Hydrogen

OF CUMULATIVEEMISSIONSREDUCTIONSAnnounced low-emissions hydrogen production projects, if realised, represent 55% of
the level in the NZE Scenario in 2030. Bold policy action is needed to create demand for
low-emissions hydrogen in order to stimulate investment in production projects.

Low-emissions hydrogen production
NZE

Fossil fuelswith CCUS

4
2015

1.5

2020

28

10

51

18

Mt hydrogen

Electrolysis

Announced projects

2030

2025

Milestones

2022

2030

2035

2050

Total hydrogen demand

95

150

215

430

Refining (Mt H2)

42

35

26

10

Industry (Mt H2)

53

71

92

139

Transport (Mt H2-eq, including hydrogen-based fuels)

0

16

40

193

Power generation (Mt H2-eq, inlcluding hydrogen-based fuels)

0

22

48

74

Other (Mt H2)

0

6

10

14

0%

1%

1%

1%

Share of total electricity generation

1

70

150

420

From low-emissions electricity

0

51

116

327

From fossil fuels with CCUS

1

18

34

89

1

590

1 340

3 300

410

1 050

Low-emissions hydrogen production (Mt H2)

Cumulative installed electrolysis capacity (GW electric input)

11

215

5 000

19 0000.5

70

Cumulative CO2 storage for hydrogen production (Mt CO2)
Hydrogen pipelines (km)Underground hydrogen storage capacity (TWh)NZE installed capacity

600

300

Including possible expansions
Electrolyser
manufacturing output

2022

2024

United States
Rest of world

Europe

2026

240

1 200

Demand for low-emissions hydrogen grows quickly
in the NZE, particularly in heavy industry, transport
and the production of hydrogen-based fuels
Mt

GW

Announced cumulative electrolyser manufacturing
capacity output, if fully realised, would be 80% of
the NZE level in 2030

44 000 209 000

80

40

2028

China

India

2030
Advanced economies

2022
Refining

Emerging market and developing economies

Chapter 2 | A renewed pathway to net zero emissions

2024

2026

Industry

Transport

Hydrogen-based fuels

2028

2030

Power generation
Other

101

8%

Carbon capture, utilisation and storage

OF CUMULATIVEEMISSIONSREDUCTIONS

If all announced CO2 capture capacity is realised and the current growth trend continues,
global capacity could reach NZE levels by 2030. Reducing project lead times, particularly
related to the development of CO2 storage, will be critical to achieve those levels.

Mt CO2

Capture capacity
1 200

CO2 captured
in the NZE

1 000
800
600
400
200
2017

2018

2019

2020

2021

2022

Announced captured capacity

2030
Operational captured capacity

2022

2030

2035

2050

Total CO2 captured (Mt CO2)

Milestones

45

1 024

2 421

6 040

CO2 capture from fossil fuels and industrial processes

44

759

1 712

3 736

Power

1

188

568

811

Industry

4

247

769

2 152
756

Merchant hydrogen

0

161

285

Other fuel transformation

38

163

90

17

CO2 capture from bioenergy

1

185

506

1 263

Power

0

44

204

438

Industry

0

23

77

232

Biofuels production

1

114

213

474

Other fuel transformation

0

5

13

121

Direct air capture

0

80

203

1 041

Total CO2 removed (Mt CO2)

1

234

632

1 710

Two-thirds of total CO2 capture is in the emerging
market and developing economies

500

Mt CO2

Mt CO2

Planned storage capacity is catching up withplanned capture

6 000

3 000

250

de

ce

n
va
Ad

ies

om

n
co

Emerging market anddeveloping economies
2017
Operational

102

2018

2019

2020

Announced capture

2021

2022

2020

2030

2040

Announced storage

International Energy Agency | Net Zero Roadmap

2050

7%

Bioenergy
While traditional use of biomass is phased out in the NZE Scenario, modern bioenergy use
more than doubles to 2050, due to its ability to be used as a direct drop-in substitute forfossil fuels. Advanced feedstock supply grows considerably, supported by investments andcommercialisation of advanced conversion technologies.

EJ

Bioenergy demand

OF CUMULATIVEEMISSIONSREDUCTIONS

Bioenergy supply

100

50

2010

2022

2030

2040

2050

2010

2022

2030

2040

2050

Modern solid bioenergy
BiogasesLiquid biofuels
Traditional use of biomass
Conversion losses

Electricity and heat
Industry
Buildings and agriculture

Conventional bioenergy crops
Forest and wood residues
Forestry plantings

Milestones
Total bioenergy supply (EJ)
Share of advanced feedstock
Modern gaseous bioenergy (EJ)
Biomethane

Organic waste streams
Short-rotation woody crops
Traditional use of biomass

2022

2030

2035

67

74

89

2050
99

45%

80%

85%

90%

1

7

9

15

0

5

6

10

4

11

13

11

12%

40%

55%

75%

Modern solid bioenergy (EJ)

35

55

65

73

Electricity and heat

9

15

21

30
22

Modern liquid bioenergy (EJ)
Share of advanced biofuels

Industry

11

15

18

Buildings and agriculture

5

9

8

6

Traditional use of solid biomass (EJ)

24

0

0

0

2 049

0

0

0

Million people using traditional biomass for cooking

2020

2025

Liquid biofuel production must expand 150% toreach levels required by 2030 in the NZE
2030

HVO and HEFA

EJ

Advanced biofuels are being developed
to enable net zero12ndt a ies
ke om
r
a
m con
ng g eig n
er opiEm veled

Alcohol-to-jet
6

Bio-FT without CCUS
Bio-FT with CCUS
Historical

NZE

Small prototype or concept
Large prototype
Demonstration
Market uptake

Advanced economies
2015

Chapter 2 | A renewed pathway to net zero emissions

2022

2030

103

1.5

Energy access and air pollution

Gt CO2-eq
SAVED VIA
ENERGY ACCESSIN 2030

Achieving universal modern energy access by 2030, in line with SDG 7, delivers
socioeconomic benefits and reduces greenhouse gas emissions. In addition, major air
pollutant emissions are halved by 2030 which reduces premature deaths by 3.6 million,
predominately in emerging market and developing economies.

3
Clean

Air pollution emissions

Mt

Billion people

Population without modern energy access

cook

ing

200

2

1

250

150

PM

2.5

SO

2

Elec

100

trici

ty

50

2015

2022

2030

NOX

2015

2022

Milestones

2050

2022

2025

2030

2050

Share of population with modern energy accessElectricity

90%

93%

100%

100%

Clean cooking

72%

80%

100%

100%

-450

-1 500Net change in greenhouse gas emissions from universal access (Mt CO2-eq)

30

58

0.9%

1.3%

Investment needed to achieve universal energy access (billion USD)
Share of total global energy investment
Premature deaths related to air pollution (million)
Ambient air pollution

4.4

4.3

2.7

2.9

Household air pollution

3.2

2.5

0.7

0.8

33%

29%

7%

7%

Share of population exposed to high levels of air pollution (>35 µg/m3)

A mix of technologies is needed to provide modern
energy access to all by 2030

Solar PV

Advanced economies

Clean cooking
By fuelBy grid typeOn-grid

By fuelElectricity

Mini- Offgrid grid

LPG

People in developing economies are more likely to
be exposed to higher concentrations of PM2.5

2022

Improved
cookstoves

2050

Other
clean

Fossil fuels

Emerging market and developing economies

880 million people

104

BiogasElectricity

2022
2050

Other

2.4 billion people

0%<5 μg/m3

100%
5-35 μg/m3>35 μg/m3

International Energy Agency | Net Zero Roadmap

97%

Fossil fuel supply

REDUCTION IN
FOSSIL FUEL
GHG EMISSIONS

Declines in fossil fuel demand are sufficiently steep that there is no need for
new long lead time upstream oil and gas conventional projects, nor from newcoal mines or mine extensions.

EJ

Total fossil fuel supply
200

Oi

l

150

l gas

a
Natur

Co

al

100

50

1990

2022

Milestones

2050

2022

2030

2035

2050

511

362

237

88

Oil

189

148

110

42

Natural gas

144

118

77

32

Coal

179

95

50

15

Fossil fuel supply (EJ)

Scope 1 and 2 emissions (Gt CO2-eq)
Oil

3.4

1.3

0.7

0.1

Natural gas

1.7

0.6

0.3

0.03

Scope 3 emissions (Gt CO2-eq)
Oil

8.9

6.9

4.7

0.8

Natural gas

6.9

5.5

3.2

0.3

Coal

15.3

8.2

3.5

0.2

100

Fossil fuel GHG emissions fall by 97% to 2050;
nearly 80% of fossil fuel demand in 2050 is for
non-combustion applications or used with CCUS
Gt CO2-eq

kg CO2-eq/boe

The emissions intensity of global oil and gas
operations falls by more than 50% to 2030

50

25

50

2010
2020
Methane

2030

2040

2050

Flaring
Electrification and energy efficiency
Transport
Hydrogen
CCUS

Chapter 2 | A renewed pathway to net zero emissions

2022
Advanced economies
Coal
Natural gas

2050
Oil

Emerging market and developing economies
Coal
Natural gas
Oil

105

Dashboard notes
Steel and aluminium
Other processes shifts include process emissions reductions from increased scrap-based andinert anode production.
Aluminium production and share of secondary production excludes production based oninternally generated scrap.
Near zero emission = projects that, once operational, are near zero emission from the start,
according to the definitions in IEA (2022c) Achieving Net Zero Heavy Industry Sectors in G7
Members. Near zero emission capable = projects that achieve substantial emissions
reductions from the start – but fall short of near zero emissions initially – with plans tocontinue reducing emissions over time such that they could later achieve near zero emission
production without additional capital investment. Production from announced projects
shown in the dashboard excludes near zero emission steel from scrap.

CementAnnounced CCUS projects include all facilities with a capacity larger than 0.1 Mt CO2 per year
as of June 2023, and projects with an announced operation date by 2030.

Primary chemicals
Near zero emission primary chemicals production is calculated excluding CCU for urea inammonia production and high value chemicals produced in refineries.
CCUS-equipped near zero emission production excludes CCU for urea in ammonia
production.

Energy efficiency and behavioural change
Avoided demand includes behavioural change. The 2030 value shown in the top graph of thedashboard refers to the average annual rate of energy intensity improvement between 2022
and 2030 in the NZE Scenario.
No new internal combustion engine trucks are sold after 2040 in advanced economies andafter 2045 in the emerging market and developing economies.

Carbon capture, utilisation and storage
Announced capture and storage capacity include all facilities with a capacity larger than
0.1 Mt CO2 per year as of June 2023, and projects with an announced operation date by 2030.
Planned capture capacity shown in the bottom graph excludes capacity for utilisation.

HVO = hydrotreated vegetable oil. HEFA = hydrotreated esters and fatty acids.
Bio-FT = biomass-based Fischer-Tropsch synthesis. Modern gaseous bioenergy refers tobiogases, which comprise biogas and biomethane.
Chapter 2 | A renewed pathway to net zero emissions

106

IEA. CC BY 4.0.

BioenergyChapter 3
Making the NZE Scenario a reality
What will it take?
S U M M A R Y• Increasing renewables capacity threefold is the single largest driver of emissions
reductions to 2030 in the Net Zero Emissions by 2050 Scenario (NZE Scenario).
Advanced economies and China are projected to reach around 85% of the required
renewables capacity by 2030 with current policies; more robust policies andinternational support are needed in other developing countries.

• Doubling the rate of energy intensity improvements makes a critical contribution toemissions reductions to 2030 and also bolsters energy affordability and security. Thisis achieved in the NZE Scenario by efficiency gains from fuel switching to electricity,
improvements in technical efficiency, and the more efficient use of materials andenergy including through behavioural change.

• Further electrification of end-uses makes the third largest contribution to emissions
reductions by 2030. The current growth rate of electric cars sales would be sufficient
to meet the 2030 level of deployment envisaged in the NZE Scenario, although faster
uptake is needed in trucks. Installations of heat pumps need to expand by almost 20%
per year to 2030, compared with 11% in 2022.

• Cutting energy sector methane emissions also brings huge climate benefits. In the NZE
Scenario, around USD 75 billion in cumulative spending is required to 2030 to deploy
all methane abatement measures in the oil and gas sector. This is equivalent to just
2% of the net income received by the oil and gas industry in 2022.

• Emerging technologies such as hydrogen and carbon capture, utilisation and storage(CCUS) cut emissions mainly after 2030. If all announced projects for hydrogenelectrolysis capacity are realised, they would provide around 70% of what is requiredin the NZE Scenario by 2030. Announced CCUS projects, currently mostly in advanced
economies, would provide nearly 40% of what is needed by 2030 globally. A stronger
policy focus on creating demand for low-emissions products and fuels is needed.

• A net zero emissions energy system requires more and varied infrastructure.
Transmission and distribution grids expand by around 2 million km each year to 2030,
and around 30 000 to 50 000 km of CO2 pipelines need to be installed in the NZE
Scenario. New hydrogen infrastructure is also necessary. Delivering the needed
infrastructure depends in part on expediting planning and permitting processes.
temperature to 1.5 °C by 2100 will become much harder. Much more CO2 would need
to be removed from the atmosphere after 2050. The Delayed Action Case indicatesthat postponing stronger action would cost the world an additional USD 1.3 trillion
per year, 50% more than was invested in fossil fuel supply in 2022.
Chapter 3 | Making the NZE Scenario a reality

107

IEA. CC BY 4.0.

• If policy ambition is not increased before 2030, limiting the increase in global average3.1

Achieving deep emissions reductions by 2030

Getting to net zero emissions by 2050 requires rapid and deep cuts in emissions of bothcarbon dioxide (CO2) and other greenhouse gases (GHG), particularly methane, by 2030.
Delaying these cuts will make it all but impossible to achieve the net zero emissions goal.
Emissions reductions can be delivered using technologies and mitigation options that arereadily available. In the NZE Scenario, they are achieved in particular with a threefold
increase in the capacity of renewables-based electricity generation, doubling the rate ofenergy intensity improvements, sharp increases in electrification, and a drop of
three‑quarters in energy sector methane emissions (Figure 3.1). This section analyses how
these milestones can be achieved.

12 000Global renewables power capacity, primary energy intensity
improvements, and energy sector methane emissions in the
NZE Scenario, 2022 and 2030
Renewables

8 000

6%

Intensity improvements

Mt

GW

Figure 3.1 ⊳4%
x3

Methane emissions

100
-75%

x2
2%

4 000

2022

150

50

2022

2030

2030

2022

2030
IEA. CC BY 4.0.

Renewables, energy efficiency and methane emissions reduction options
are available today and crucial to reducing near-term emissions
Notes: GW = gigawatts; Mt = million tonnes. For energy intensity improvements, the 2030 value reflects theannual improvement between 2022 and 2030 in the NZE Scenario.

3.1.1

Triple renewables capacity

Technology options

108

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Installed capacity of renewables-based electricity generation triples by 2030 to make thesingle biggest contribution to reducing global CO2 emissions by 2030 in the NZE Scenario.
Global installed capacity jumps from 3 630 gigawatts (GW) in 2022 to 11 000 GW in 2030, led
by solar photovoltaics (PV) and wind (Figure 3.2).

Increasing renewables capacity threefold requires the annual pace of capacity additions torise from 336 GW in 2022 to over 1 250 GW by 2030 – an annual average increase of 18%.
Over the last decade, capacity additions more than quadrupled. Maintaining the recent paceof growth to 2030 would put the power sector on course to achieve what is needed in the
NZE Scenario.
The share of electricity generation that comes from renewables rises from 30% in 2022 toalmost 60% in 2030 in the NZE Scenario, with the combined share of solar PV and windincreasing from 12% in 2022 to 40% in 2030. The increase in renewables generation outpaces
electricity demand growth, which cuts back unabated coal-fired generation and reduces its
related emissions by half. In total, electricity sector emissions fall by about 6 gigatonnes ofcarbon dioxide (Gt CO2) between 2022 and 2030, more than the current emissions of theelectricity sector in China.
Figure 3.2 ⊳Global renewables installed capacity by technology, 2010-2030,
and solar PV and wind manufacturing and capacity additions in
the NZE Scenario, 2022 and 2030

GW

Renewables installed capacity
12 000

1 200

8 000

800

4 000

400

2010
Hydro

Wind

3

Solar PV

2030
Solar PV

Bioenergy

Manufacturing capacity

Other

2022

Wind

Capacity additions

Solar PV

Planned

Wind

2030 NZE
IEA. CC BY 4.0.

Solar PV and wind lead the way in the NZE Scenario, together accounting for over 90% of theoverall increase in renewables capacity to 2030 and 85% of the increase in renewableelectricity generation. Solar PV and wind are the cheapest new sources of electricity in mostmarkets today, are widely available, rapidly scalable and have policy support in over
140 countries. Global solar PV capacity additions increase from 220 GW in 2022 to 820 GW
in 2030, of which about 60% is utility-scale projects and around 40% is distributed solar PV
such as rooftop arrays on houses and businesses. Wind capacity additions rise from 75 GW
in 2022 to 320 GW in 2030, with offshore wind accounting for around one-third of the total.
The rapid expansion of solar PV and wind to 2030 would increase the amount of land
Chapter 3 | Making the NZE Scenario a reality

109

IEA. CC BY 4.0.

Global renewables capacity triples by 2030 led by solar PV and wind,underpinned by rapid expansion of manufacturing capacityoccupied by these technologies by up to fourfold from today (Box 3.1). Other renewableenergy technologies, including hydropower, bioenergy, geothermal, concentrating solar andmarine power, boost annual capacity additions which together increase from 42 GW in 2022
to about 125 GW in 2030.
The global clean energy manufacturing industry is already gearing up to provide a hugeincrease in renewables capacity (see Chapter 1). If all the projects for manufacturing solar PV
modules that have been announced go ahead, the capacity would be sufficient to meet theneeds of the NZE Scenario in 2030. This is cause for optimism, but it cannot be taken for
granted that they all will progress as planned. The outlook for global manufacturing capacity
additions for wind is much less encouraging. If renewable power capacity is to triple by 2030,
as envisaged in the NZE Scenario, stronger policies are needed in all jurisdictions to facilitate
more rapid deployment of renewables, including through support for wind manufacturing
capacity. In established markets, action to streamline permitting and land acquisition
processes will be an essential element of stronger policy packages. In less developed
markets, particularly in the emerging market and developing economies other than China,
action to boost incentives to invest and reduce the costs of financing will be particularly
important (IEA, 2023a). In all markets, boosting the flexibility of power systems, grids inparticular, will be critical to successfully integrate rising shares of solar PV and wind (IEA,
forthcoming). This points to the need for significant investment to expand and strengthen
electricity grids (see section 3.2.4).

Permitting and grid connections
Increasing global renewables capacity threefold by 2030 in the NZE Scenario depends on
expediting permitting and grid connections, and overcoming other challenges including
social acceptance and limitations on available sites. Generation costs of wind and solar PV
projects are already competitive in many countries, but permitting processes are slowing thepace of their deployment, as are delays in obtaining grid connections.
The size and importance of the issue underline the case for action. In Europe, today around
60 GW of onshore wind capacity – four-times the capacity commissioned in 2022 – is held up
by various permitting procedures. Globally, around 3 000 GW of wind and solar PV projects
in large renewable energy markets have applied for grid connections, which is slightly lessthan half the additional renewables capacity projected in the NZE Scenario by 2030
(Figure 3.3). Not all these projects are expected to come to fruition, but they give an
indication of the scale of the issue.

110International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The time required to obtain permits ranges from one to five years for ground-mounted solar
projects, three to nine years for onshore wind, and nine years for offshore wind. The timerequired to obtain grid connections can also take several years and appears to be increasing
rather than shrinking. These timescales are hindering current projects and risk choking off
new ones.

Figure 3.3 ⊳Global grid connection queues for wind and solar PV
by project status, 2022
Project status

GW

Grid connection queues
3 000

Wind
Solar PV
Advanced
18%

2 000
Early stage
50%
1 000

3

Under
review
32%

Interconnection Total installed
queuescapacity
IEA. CC BY 4.0.

Achieving the net zero emissions pathway requires streamlining of permitting processes

Policy efforts to improve permitting procedures should be focussed on three areas:
simplifying permitting procedures and/or setting clear permitting timelines; identifying
preferential areas for renewable energy projects to fast track permitting; and removing
certain permitting requirements for small renewable power projects and/or increasing theminimum capacity requirement for environmental impact assessments. These changes aim
to reduce permit lead times and increase project bankability. Efforts to speed up gridconnections for new renewables capacity should be focussed on ensuring that the relevant
authorities view the provision of such connections as a high priority and are resourced todeliver what is required.

Boosting capacity in the emerging market and developing economies

Chapter 3 | Making the NZE Scenario a reality

111

IEA. CC BY 4.0.

China alone accounted for three-quarters of renewables-based power generation capacity
additions in emerging market and developing economies over the last decade. Capacity
additions in China during the last decade included three-times more solar PV and windcapacity than all other emerging market and developing economies combined. Clear andambitious targets, strong policy support, mature local supply chains and low-cost financing
were all key factors in this rapid expansion of renewables. This strong foundation has enabled
China to reduce unit costs very rapidly, and it is now set to achieve its current Nationally
Determined Contribution’s target for installed wind and solar PV capacity by 2025, five years
ahead of schedule.

10 000

Installed renewables capacity by technology and economic
grouping in the STEPS and NZE Scenario, 2022 and 2030

Advanced economies and China
GW

GW

Figure 3.4 ⊳

x 1.2

8 000

4 000

6 000

3 000

4 000

2 000

2 000

1 000
2022

2030 STEPS 2030 NZESolar PV

Other EMDE

5 000

Wind

x 1.8

2022
Hydro

2030 STEPS 2030 NZE

Bioenergy

Other
IEA. CC BY 4.0.

Emerging market and developing economies other than China require
the largest boost in the growth of renewables beyond the current pathway
Note: EMDE = emerging market and developing economies; STEPS = Stated Policies Scenario.

Appropriate policies are needed to address causes of the high cost of capital in these
economies. Clear national targets with an annual implementation plan, for instance throughcompetitive auctions, would be likely to increase investor confidence. In India, for example,
an ambitious government target set for renewables capacity has been followed by central
and provincial auction schedules with a transparent procurement process. The risks
associated with the financial health of off-takers could be addressed through standardised
power purchase contracts backed by government guarantees, especially for publicly owned
utilities. India provides an example of policy action here too: its centralised large-scaleauctions conducted by the Solar Energy Corporation of India (SECI) helped reduce project
112

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Other emerging market and developing economies also have significant potential to expand
renewables cost effectively. They quadruple their total renewable capacity by 2030 in the
NZE Scenario, with solar PV and wind providing over 80% of the increase (Figure 3.4). This isover twice the increase projected in the Stated Policies Scenario (STEPS). One of the mainbarriers to this faster growth of renewables capacity is the high cost of financing projects,
which reflects project risk assessments that take account of issues such as policy
uncertainties, weak financial health of off-takers, limited grid infrastructure andmacroeconomic factors, including currency risks. The weighted average cost of capital(WACC) for renewables in emerging market and developing economies remain at least
double those in advanced economies (see Chapter 4). Since every 1 percentage point
increase in the WACC increases wind and solar PV generation costs by at least 7%, this makes
an enormous difference to the prospects for renewables.

risks and lower the cost of capital for utility-scale solar PV and wind plants. Policies along
these lines could also facilitate the availability of concessional financing from internationaland regional development banks, and this would further reduce the cost of capital.

Integration of variable renewables
While power systems have always had to accommodate the variability of electricity demand,
the rapid expansion of solar PV and wind – both variable sources whose output depends on
weather conditions – means that power system flexibility needs will increase. Since solar PV
and wind do not contribute to grid stability in the same way as the fossil fuels which they
increasingly displace in the NZE Scenario, new ways to ensure grid stability will also beneeded.

2030

Share of total electricity generation from wind and solar PV by
selected country/region in 2022 and in the NZE Scenario in 2030

European Union
United States
China
C & S America
World
India
Japan
Southeast Asia
Africa2022

Figure 3.5 ⊳3Denmark
IrelandGermany
Spain
European Union
United States
China
C & S America
World
India
Japan
Southeast Asia
AfricaWind
Solar PV

20%

40%

60%

80%
IEA. CC BY 4.0.

Note: C & S America = Central and South America.

Chapter 3 | Making the NZE Scenario a reality

113

IEA. CC BY 4.0.

Integration of solar PV and wind is critical to the NZE Scenario, as their share in total
generation in most regions reaches levels in 2030 seen only in a few countries today

The rapid deployment of solar PV and wind in the NZE Scenario lifts their share of electricity
generation in 2030 to over one-third in most regions of the world. Without effective action
to ensure system flexibility, this could result in rising amounts of surplus solar PV and windat times when output exceeds demand. Countries including Denmark, Ireland and Spain
already produce one-third or more of their electricity from renewables and have managed
the challenges of integration: other countries may be able to draw on the lessons they havelearned (Figure 3.5).
Rising shares of variable renewables make electricity supply more weather dependent andleads to higher needs for flexibility across all timescales, ranging from hours to seasons andyears. Varying wind patterns observed over weeks and seasons, for example, can contributesignificantly to the increase of seasonal flexibility needs, while solar PV variability has thebiggest impact on timescales ranging from hours to days.
Successfully integrating these rising shares of solar PV and wind in electricity generation
requires making the best use of existing and new sources of flexibility, and market andregulatory frameworks have a crucial part to facilitate this. Existing power plants, including
natural gas- and coal-fired stations, can contribute while they remain in operation byfocussing on flexibility rather than bulk electricity production. New sources of flexibility
include energy storage technologies such as batteries and demand response help inparticular to balance daily peaks and troughs, and between them they meet much of theshort-term flexibility need in the NZE Scenario. Low-emissions dispatchable thermal power
plants, including nuclear plants, reservoir and pumped storage hydro, grid-connected
electrolysers and long-duration hydrogen storage all play a part in the delivery of longer termand seasonal flexibility.

114

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Transmission and distribution grids need to be modernised and expanded to facilitate theintegration of rising shares of solar PV and wind and the deployment of all sources offlexibility. This should be done in a way that facilitates demand response management, forexample by providing incentives to use energy at times of high supply of renewableelectricity, including through time-of-use tariffs (see section 3.2.4). Interconnections
between regions are another option to provide flexibility: they allow for the pooling offlexibility resources and reduce the need for additional power system flexibility by balancing
load, wind and solar production over large geographical areas. Measures to ensure systemstability also need to be integrated into work to modernise and expand grids: they include
the deployment of synchronous condensers, flexible alternating current transmission
systems (FACTS), grid-forming inverters and fast frequency response (FFR) capabilities.

Box 3.1 ⊳Does the world have enough space for all the solar and wind in the
NZE Scenario?

Based on a review of over 100 completed projects worldwide, we estimate that all theutility-scale solar PV and onshore wind projects in operation in the world in 2022 coverless than 0.2 million km2 of land area. Solar PV installations in or on buildings are notincluded in this assessment as they rarely require additional land. We found that a utilityscale solar PV project of 100 MW generally occupies from 1 km2 to 3 km2. This is in linewith other published estimates (NREL, 2021; A. Arvesen, 2018; Smil, 2010; UNECE, 2022).
We also found that a 100 MW onshore wind turbine project generally covers from 5 km2
to 30 km2: here too our findings are consistent with other published estimates (NREL,
2021; Enevoldsen and Jacobson, 2021; Lovering et al., 2022). Wind projects require moreland than solar projects per unit of capacity in part because the vast majority ofutility‑scale PV takes the form of solar panel arrays, where panels can be put close to one
another, whereas wind turbines need a certain amount of space around them to optimise
their performance. Variations in project size reflect a number of factors, including turbine
design and the shape and geography of the site.
Figure 3.6 ⊳Total and annual land requirements for solar PV utility andonshore wind in the NZE Scenario, 2022, 2030 and 2050
Annual land required
2.0%

1.2

1.5%

0.8

1.0%

0.4

0.5%

2022 2030 2050
Solar PV

2022 2030 2050
Wind

Thousand km²

1.6

Share of suitable land

Total land required

Million km²

3

80
60
40
20

2022 2030
Solar PV and wind
IEA. CC BY 4.0.

The rapid expansion of solar PV and wind requires up to 2.0 million km2 of land areaby 2050 in the NZE Scenario, equivalent to up to 2.5% of global suitable land

In the NZE Scenario, the tripling of renewables capacity by 2030 increases the global landarea requirements for onshore wind and solar PV to up to 0.8 million km2, which is morethan four times the amount of land they use today. Wind power accounts for the majorityof the land that is needed, though project requirements for a given output vary widely
Chapter 3 | Making the NZE Scenario a reality

115

IEA. CC BY 4.0.

Note: km2 = square kilometres.

depending on the type of turbine used and on the nature of the project site. By 2050,
total land requirements for onshore wind and utility-scale solar PV rise to up to 2.0 million
km2, or more than ten times the amount of land used today (Figure 3.6). On an annual
basis, the land needed each year for new solar PV and onshore wind projects rises from
5-20 thousand km2 in 2022 to 20-75 thousand km2 in 2030. Achieving this scaling up
requires action to overcome challenges related to land acquisition, permitting, local
acceptance and grid development.
The requirement for land totalling up to 2.0 million km2 for solar PV and wind in the NZE
Scenario needs to be put into context. It is much less than the global requirement forland for crops in 2020 (12.2 million km2) or for built-up areas in the same year (about
4.3 million km2). But it is more useful to look at solar PV and wind requirements as aproportion of the land that is suitable for such projects, and we have attempted to do
this. Suitable land in this analysis includes grasslands, shrub-covered areas, sparsely
naturally vegetated areas, terrestrial barren land. It also includes most agricultural landon the basis that many projects have already demonstrated that farming activities can
co-exist with onshore wind projects. However, it excludes artificial surfaces (including
urban and associated areas), tree-covered areas, woody crops, mangroves, aquatic or
regularly flooded areas, and permanent snow and glaciers.
This analysis results in about one-third of global land being ruled out as unsuitable forsolar PV and wind, leaving just over 80 million km2 as suitable, based on available landarea data (FAO, n.d.). In the NZE Scenario, the global share of suitable land occupied byonshore wind and solar PV rises from about 0.2% in 2022 to up to 0.9% in 2030 and up
to 2.5% in 2050, though the share varies widely by region. The increase in the land
required for solar PV and wind in the NZE Scenario is certainly significant, but it is hard toargue that the world does not have the necessary space.

3.1.2

Double the rate of energy intensity improvements

The annual rate of improvements in energy intensity – the amount of primary energy needed
to produce a dollar of economic output – averages 4.1% through to 2030 in the NZE Scenario.
This is double the rate achieved in 2022, which itself was nearly double the average rateachieved over the previous five years. One result of the rate of improvement achieved in
the NZE Scenario is that energy demand in 2030 is nearly 10% lower than in 2022, even as
the economy continues to grow. Reduced consumption means reduced emissions. It also
brings energy security benefits and helps to make energy more affordable.



A shift to more efficient fuels through electrification, renewables and universal accessto clean cooking fuels.

Technical efficiency measures in all sectors.

116

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

There are three main levers that double the rate of improvements in primary energy intensity
in the NZE Scenario, each of which contributes roughly a third of the gains (Figure 3.7):

Avoided energy demand through material and resource efficiency gains, including
through behavioural change.

Figure 3.7 ⊳Rate of annual primary energy intensity improvements by leverin the NZE Scenario

5%

Power

3

Buildings

4%

Transport
Industry

3%
2%
Fuel switching
1%

2022

Electrification Clean
and renewables cooking

Technical
efficiency

Avoideddemand2030
NZE
IEA. CC BY 4.0.

More rigorous policies to boost fuel switching, energy and resource efficiency, andbehavioural change are essential to double the rate of improvement in energy intensity
Notes: Avoided demand includes behavioural change. 2030 NZE refers to the average annual rate of energy
intensity improvements between 2022 and 2030 in the NZE Scenario.

Switch to more efficient fuels: Role of electrification
Electrification is a major driver of the sharp fall in energy intensity in the NZE Scenario
because electricity can be converted into energy services much more efficiently thanincumbent fossil fuel-based technologies. Electric vehicles (EVs) are two- to four-times more
efficient than current internal combustion engine (ICE) vehicles; heat pumps are three- to
five-times more efficient than fossil fuel boilers, and induction stoves are about twice as
efficient as gas stoves. In the NZE Scenario, a rapid shift to electricity across the energy
system results in energy savings, reaching nearly 20 exajoules (EJ) by 2030, close to the
combined current final consumption of Japan and Korea.

Chapter 3 | Making the NZE Scenario a reality

117

IEA. CC BY 4.0.

The majority of these savings are realised through the rapid uptake of EVs in transport andheat pumps in the residential sector (Figure 3.8). Both these technologies are already in use
and are gaining ground, but the NZE Scenario speeds up their adoption and doubles theenergy savings that they bring in the STEPS outlook (see section 3.1.3).

Figure 3.8 ⊳Annual energy savings from electrification in the NZE Scenario
Transport
Residential-5- 5Services

- 10
-10

Other

Industry
Achieved under STEPS

- 15
-15

EJ

EJ

- 20

-20

2025

2030

2025

2030
IEA. CC BY 4.0.

Electrification results in annual energy savings of nearly 20 EJ by 2030,
equivalent to the combined current final consumption of Japan and Korea

Technical efficiency measures: Improving the efficiency of appliances in buildings
Improvements in the unit energy consumption of appliances in recent decades have been
impressive. Refrigerators purchased today consume less than half as much electricity as
models sold 20 years ago; air conditioners have become over 40% more efficient in the same
timeframe. These gains have been driven by a combination of technology improvements andpolicy measures designed to diffuse those improvements, notably through the widespread
adoption of standards and labelling. Together they have reduced annual electricity
consumption by around 15% in regions with long-standing policies. At the same time,
appliances subject to standards and labelling programmes have become significantly lessexpensive (IEA, 2021a). Appliance standards are now in place in more than 110 countries
and, for example, cover 90% of the energy consumption by refrigerators worldwide.
The NZE Scenario builds on the progress of such programmes but requires an increasing focus
on best available technologies in all regions. 1 This is particularly important in emerging
market and developing economies, where most appliance sales through to 2030 will beconcentrated, and where efficiency policies are generally less stringent today than inadvanced economies.

1 The Super-Efficient Equipment and Appliance Deployment Initiative, a collaboration of the IEA with morethan 20 governments and other partners, supports standards and labelling efforts by helping policy makers
simplify regulation setting and compliance.

118

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Air conditioners are particularly important in this context. The stock of air conditioners inemerging market and developing economies is set to double by the end of the decadereflecting rising incomes and cooling needs. This presents enormous scope to increase theaverage efficiency of air conditioners. Highly efficient models are already available, but thosesold today are on average just half as efficient as the best available technology in manymarkets. Thanks to standards and labelling programmes, average air conditioners sold in theemerging market and developing economies in 2030 in the NZE Scenario are at least 50%
more efficient than today (Figure 3.9). More efficient models sometimes cost slightly morethan the alternatives, but this is not always the case, and they save consumers money overtheir lifetime due to lower operating costs. Energy efficiency improvements of building
envelopes (Box 3.2) as well as passive cooling strategies and behavioural changes such as
higher air conditioner temperatures can also bring down energy bills and curb growth inelectricity demand.
Average efficiency and purchase price of new air conditioners
in emerging market and developing economies

Average efficiency

8

USD (2022, PPP)

W/W

Figure 3.9 ⊳

3

6
4

4 000

Purchase price 2022/2023

3 000
2 000
1 000

2

2022

2022
BAT

2030
NZE

Low
MediumHighefficiency efficiency efficiency
IEA. CC BY 4.0.

Efficiency improvements are vital in the NZE Scenario, and efficient air conditioners
today are not significantly more expensive than those with lower efficiency
Notes: W/W = Watt of cooling output per Watt of electricity input; BAT = best available technology;
PPP = purchasing power parity. Based on data for wall air conditioners collected from Argentina, Brazil,
Colombia, Ghana, Kenya, Panama and Vietnam in late 2022 and early 2023. Purchase prices are normalised toa cooling capacity of 12 000 British thermal units per hour. Low efficiency = below 4 W/W; medium
efficiency = 4-5 W/W; high efficiency = above 5 W/W.

A (retro) fitting solution to decarbonise buildings

Retrofitting is one of the main levers for decarbonising the buildings sector. Buildings inadvanced economies have relatively long lifetimes, about 80 years on average. Over 90%of the buildings that will be in use in these countries in 2030 have already been built. In
the NZE Scenario, 2.5% of buildings in advanced economies are retrofitted each year from

Chapter 3 | Making the NZE Scenario a reality

119

IEA. CC BY 4.0.

Box 3.2 ⊳2030 onwards and all new buildings are zero-carbon-ready. Building energy codes andstrong retrofit policies drive these developments, which together account for 40% of theemissions savings from efficiency measures in residential buildings.
In the past decade, between 2-14% of buildings a year in at least some advanced
economies have undergone some kind of a retrofit, but fewer than 1.5% of buildings havebeen retrofitted sufficiently each year to lower energy demand by 30% or more
(Figure 3.10). Achieving bigger energy savings from each retrofit will require consistentand robust policy support from governments.
Figure 3.10 ⊳ Annual retrofit rates and space heating energy intensityof residential buildings in advanced economies

Heating energy intensity

Retrofit rates
Advanced economies

United States and Canada
Nordic countries
European Union*
United Kingdom
1%

2%

3%

50

Average in the past decade2030 NZE

100
150
kWh/m2/year
IEA. CC BY 4.0.

Annual residential building retrofit rates in advanced economies averageless than 1.5% today; a step up to 2.5% by 2030 is needed in the NZE Scenario*European Union here excludes Denmark, Finland and Sweden. These are included under Nordic
countries.
Notes: kWh/m2/year = kilowatt-hour per square metre per year. Retrofit rates included here yield energy
savings of 30% or more. The NZE Scenario 2030 target shows an average that varies depending on regional
climate conditions and heating needs.
Sources: European Commission (2019), Olgyay (2010), US EIA (2018), and ZEBRA (2020).

120International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Cost and convenience are the primary barriers to stepping up the rate and depth ofretrofits. The cost of insulation materials has increased in recent years amidst supply
chain disruptions and inflation. Retrofitting the average size home in advanced
economies can cost thousands of USD, which can pose a significant financial barrier for
lower income households (see Chapter 4). Deeper retrofits also often require additionaltime and cause extra disruption to occupants.

In recent years, numerous governments have offered grants, subsidies and tax credits toincentivise retrofits through programmes such as the US Inflation Reduction Act, the UK
Greener Homes Grant, and the Superbonus in Italy. They have boosted retrofit rates
substantially, but many incentives have expired or are due to expire soon. A number ofgovernments have put strategies in place to standardise renovations, speed up retrofits
and lower costs, and these could be replicated or adapted for use in other countries. For
example, the Dutch Energiesprong programme relies on digital planning andprefabricated facades to deliver projects more quickly, while the Irish National
Retrofitting Scheme emphasises one-stop shops so that homeowners can accesscomplete renovation management and financing services via one counterpart. Legislative
measures may also have a part to play. For example, the European Union is considering
legislation to require retrofits of the least energy-efficient buildings in member states(European Parliament, 2023).

3

Avoided energy demand: Impact of behavioural change
Although technical options to reduce energy intensity are maximised in the NZE Scenario,
the pace of turnover of the global stock of energy-related assets imposes constraints on what
can be achieved by 2030. Consequently, behavioural changes – actions that consumers cantake to reduce energy consumption – are needed to accelerate improvements in energy
intensity. In the buildings sector, they include adjusting space heating and coolingtemperatures. In the transport sector, they include more public transport and reduced car
use in cities, eco-driving on highways and switching from planes to trains orvideoconferencing. To bring about these changes, issues such as the high cost of train travelneed to be addressed, and new financial incentives need to be introduced such as congestion
charges in cities and levies on frequent flyers (IEA, 2023b).

The reduction in energy demand from sustained behavioural changes in the NZE Scenario issignificant, but it builds on the reductions achieved as a result of recent policy interventions
related to the Covid-19 pandemic and energy crisis. For example, teleworking was still
three‑times more prevalent in 2022 than in 2019 (Parker, Horowitz and Minkin, 2022). Theenergy crisis of 2022 led to a number of measures designed to change behaviour, including
Chapter 3 | Making the NZE Scenario a reality

121

IEA. CC BY 4.0.

Behavioural change in the NZE Scenario happens more quickly and to a larger extent inadvanced economies than elsewhere. For example, demand for space cooling on a per capita
basis is more than three-times higher in advanced economies even though emerging market
and developing economies have around three-times more cooling degree days in a typicalyear. This means that raising space cooling temperatures generates far greater savings per
capita in advanced economies than in emerging market and developing economies. In 2030,
on a per capita basis, the energy savings in the NZE Scenario from behavioural changes inroad transport and the buildings sector are about five-times higher in advanced economies
than in emerging market and developing economies; in aviation they are about eight-times
higher (Figure 3.11).

national energy savings campaigns such as in Denmark, Germany, Ireland and Sweden.
Among the Group of 20 (G20) nations, the number of policies supporting behaviouralchanges has more than doubled since 2021, and the G20 forum has recognised theimportance of behavioural change with adoption of the High-Level Principles for Lifestyles
for Sustainable Development.
Figure 3.11 ⊳ Changes in energy consumption from behavioural measuresin the NZE Scenario, 2030

Advanced
economies-1

GJ per capita

-2

-3

-4

Emerging market anddeveloping economies

Road transport
Low car cities
Carpooling
Working from home
Speed limits
Other fuel-efficiency
Fewer SUVs
Buildings
Space heating
Space cooling
Eco-household
Aviation
Aviation measures
IEA. CC BY 4.0.

Behavioural changes save five-times more energy per capita in advanced economies
Notes: Low car cities represent an urban model where planning and infrastructure reduce the dependence on
cars to substantially improve public health, well-being and liveability, including a host of measures such as thephase-out of internal combustion engine cars from city centres, shared mobility or moderating urban speed
limits. Other fuel efficiency includes reducing air conditioning temperatures in cars and eco-driving practices.
Space heating/cooling includes limiting heating temperatures to 19-20 °C and cooling temperatures to24-25 °C. Eco-household includes line drying clothes instead of machine drying, reducing laundry
temperatures, switching off lights in unoccupied rooms, unplugging appliances not in use and reducing water
heating temperatures. Aviation measures include a shift from short-haul flights to high-speed rail, reductionof business flights and imposition of a levy for frequent flyers.

122International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Behavioural change in the advanced economies reduces electricity demand in the buildings
sector in 2030 by more than 6% and natural gas demand by around 15% in the NZE Scenario.
Recent experience suggests that this is feasible: in Germany, households and small
businesses cut natural gas consumption by up to 42% in 2022 in response to the energy crisisand public exhortations to save energy (Hirth, 2022). Similarly, driving in ICE cars drops by up
to 14% from 2022 to 2030 with more use of public transport, cycling and walking. There areencouraging precedents here too: for example, London’s congestion charge brought about
an 18% drop in car traffic 20 years after its first adoption (Transport for London, 2023).

Switching to more efficient fuels: Role of access to modern energy
Accelerating access to modern energy helps drive down energy intensity more quickly in the
NZE Scenario. Nearly 2.3 billion people in around 130 countries, mainly in Asia andsub-Saharan Africa, lack access to clean cooking today, while nearly 780 million people
remain without access to electricity. In addition to its other benefits, access to modern
energy improves energy efficiency. Despite considerable population growth, universal accessto clean cooking cuts residential fuel demand for cooking in emerging market and developing
economies by nearly 60% by 2030 in the NZE Scenario compared with today.

3

This is mainly due to switching from extremely inefficient traditional use of biomass toimproved cookstoves (ICS). These stoves are more efficient, burn less wood and emit lesssmoke than traditional cook stoves. They allow poor households in rural areas to make a firststep toward clean cooking without changing the fuel they use. For this to happen, investment
in clean cooking stoves, equipment and infrastructure over this decade needs to reach about
USD 8 billion annually – less than 1% of what governments spent in 2022 on measures tokeep energy affordable for their citizens amidst the global energy crisis.
Figure 3.12 ⊳ Energy use for residential cooking and gains in access to40

Change in residential
cooking demand by fuel30

Million people

EJ

modern fuels in emerging market and developing economies
in the NZE Scenario

Modern20

Traditional

1 600

People gaining accessby region and period
Sub-Saharan Africa
Other EMDEOther developing Asia
Indonesia
China
India

1 200
800
400

10
ICS
2022

2030

Best 10 year
improvement

2020-2030
IEA. CC BY 4.0.

Universal access to clean cooking cuts residential fuel demand for cooking
in emerging and developing economies by nearly 60% by 2030 relative to today

Achieving universal access to modern energy would involve an accelerated deployment of allavailable technologies, and an unprecedented reversal of current trends in sub-Saharan
Chapter 3 | Making the NZE Scenario a reality

123

IEA. CC BY 4.0.

Notes: EJ = exajoules. ICS = improved cook stoves that use solid biomass as a fuel. Modern = modern fuelssuch as liquefied petroleum gas, electricity, biogas and ethanol. Traditional = traditional use of biomass, coaland kerosene. Best ten-year improvement bars reflect the single best historic year of providing clean cooking
access for each country between 2000 and 2022, and assumes this is repeated for ten years as a representative
point of comparison for the level of effort required to reach Sustainable Development Goal 7.

Africa, where the population without access has climbed continuously in most countries.
However, progress in other regions has demonstrated that it is possible to quickly provide
access to clean cooking solutions (Figure 3.12). For example, in India, nearly half a billion
people gained access within ten years thanks to a combination of subsidised refills ofliquefied petroleum (LPG) cylinders, deposit-free LPG connections and a scheme allowing
wealthier households to voluntarily renounce their access to LPG subsidies. Similar successstories from China and Indonesia showcase how strong national efforts can make an impact,with each country providing 2-3% of its population with clean cooking technologies every
year (IEA, 2023c).

3.1.3

Accelerate electrification

From 2023 to 2030, around one-fifth of the emissions reductions in the NZE Scenario result
from electrification of end-uses that would otherwise have used fossil fuels. In transport,
most of the gains come from the deployment of EVs. In the buildings sector, emissions
reductions mostly come from the installation of heat pumps. In industry, there is potential
for the electrification of low-temperature and some medium-temperature heat applications
using highly efficient industrial heat pumps, with other electric heating technologies andthermal energy storage further extending electricity’s reach. The electrification of heavy
industries – steel, cement and chemicals – is critical to the achievement of the NZE Scenario,
but these industrial branches reach lower levels of electrification to 2030. This is mainly due
to the time needed to develop market-ready direct electrification technologies for certain
applications, such as providing high-temperature heat in cement and chemical
manufacturing, and the chemical reduction of iron ore in the steel making.

Electrification in transport

China and the advanced economies are expected to lead the way in the electrification ofvehicle fleets, in which EV sales account for 80% of light-duty vehicles, 85% of buses and 55%of heavy trucks in 2030 in the NZE Scenario. As sales increase and costs decline, electrification
follows in the other emerging and developing economies, where EV sales account for 40% oflight-duty vehicles, 40% of buses and 7% of heavy trucks in 2030 in the NZE Scenario. This is
supported by a rapid roll-out of charging infrastructure and associated investment inelectricity grids.

124

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Electrification ramps up more quickly in transport than in other end-use sectors in the
NZE Scenario. The share of transport energy consumption accounted for by oil falls fromabout 90% today to 80% in 2030; the share of electricity increases from 1% to almost 8%
over the same period (Figure 3.13). More than 90% of this increase in electricity demand is
attributable to the switch from ICE vehicles to EVs, and 50% of that in turn is attributable
solely to electric cars. Electrification progresses in the STEPS too, reflecting rapid costdeclines in recent years and strong policy support in major markets, but its pace issignificantly faster in the NZE Scenario.

Figure 3.13 ⊳ Global electricity demand in road transport by scenario,
TWh2022-2030, and EV sales shares in the NZE Scenario, 2010-2030

1 400

Road transport electricity demand

14%

70%

1 200

12%

60%

1 000

10%

50%

800

8%

40%

600

6%

30%

400

4%

20%

200

2%

10%

Passenger
Freight2022
2030 STEPS
2030 NZE
Share of electricity in road transport (right axis)

EV sales share

Cars

3

Heavy
trucks
2010

2030

2022

IEA. CC BY 4.0.

Electricity meets over 10% of energy demand in passenger road transportand electric cars are about 65% of all cars sales in 2030 in the NZE Scenario
Note: TWh = terawatt-hour.

Electrification of heavier vehicle segments, such as trucks and buses, needs to accelerate
faster to deliver what is required in the NZE Scenario. Electric buses increase their share ofsales from 4% in 2022 to over 50% in 2030 in the NZE Scenario, and electric heavy trucks
increase from 1% to 33% share. There are some encouraging signs that the pace of progress
may increase. Truck and bus manufacturers are increasingly offering zero emissions vehicles.
Electric buses and trucks are becoming increasingly competitive on a total cost-of-ownershipbasis. However, additional electricity demand by 2030 in the STEPS for heavy trucks andbuses is only one-third of the level in the NZE Scenario, indicating that more needs to bedone to accelerate uptake.

Chapter 3 | Making the NZE Scenario a reality

125

IEA. CC BY 4.0.

Over the decade prior to 2022, global electric car sales increased at an average annual rateof over 50%; in the NZE Scenario, they increase on average by around 25% annually between
2023 and 2030, although from a higher base. Their share of total car sales reaches about 65%(compared with 14% in 2022). This suggests that electric car sales could meet or exceed what
is called for in the NZE Scenario by 2030. There are currently about 500 electric car models
available worldwide, and this is set to increase. For example, Volvo plans to sell only electriccars by 2030 and BYD, an automaker in China, has already stopped selling ICE vehicles.
Investments in electric vehicle battery manufacturing are also picking up, with capacity
increasing by almost 60% in 2022; announced expansions, if they proceed as planned, would
deliver a throughput sufficient to meet the demand in 2030 in the NZE Scenario (seeChapter 1).

Currently, the most common policy measures to support EV deployment are fuel-economy
and CO2 emission standards, both for light- and heavy-duty vehicles, as well as financial
incentives such as purchase subsidies and tax credits that make EVs more cost competitive
with conventional ICE vehicles. Governments are also supporting the development of EV
charging infrastructure, for example by offering financial incentives for public as well asprivate chargers and by stipulating infrastructure requirements in building codes.

Electrification in buildings
The share of electricity in energy use in the buildings sector worldwide rises from 35% today
to nearly 50% in 2030 in the NZE Scenario, compared with 40% in the STEPS. The share ofelectricity in space and water heating increases by around 7 percentage points by 2030,
mainly as a result of increased deployment of heat pumps, which are three- to four-times
more efficient than electric resistance heaters. Heat pumps met around 10% of global
heating needs in buildings in 2022, with more than 1 000 GW of capacity in operation forspace (and/or water) heating. Sales of heat pumps are increasing rapidly: they rose by 11%
in 2022, marking a second year of double-digit growth (IEA, 2023d). Growth is even faster in
the NZE Scenario, with the stock almost tripling by 2030, by which time it meets overone‑fifth of building sector heating needs. This implies average annual sales growth of almost
20% between 2023 and 2030 (Figure 3.14). In the European Union, the annual increase ofheat pump sales has been over 35% since 2021, implying that the growth rates required in
the NZE Scenario are feasible.
Figure 3.14 ⊳ Global heat pump sales growth rate and share of electricity inbuildings end-uses in the NZE Scenario, 2010-2030

Average annual growth in heat pump sales

Share of electricity in buildings end-uses

20%

60%

15%

45%

10%

30%

Buildings
Water heating
5%

15%
Space heating
20102015

20152020

20202022

20222030

2010

2020

2030
IEA. CC BY 4.0.

126

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Sales of heat pumps have surged since 2020, but need further growth to reach 2030 targets

In most markets, the upfront cost of a residential heat pump (including installation) is
generally much higher than that of a fossil fuel boiler, though the extent of the cost gap varies
widely within and across countries, even for the same technology. Nonetheless, in somemature markets, such as Norway, Denmark and Japan, the least expensive ductless air‐to‐air
heat pump models have become cheaper than natural gas boilers for new installations insmall houses, thanks primarily to reduced piping work and installation costs.
Financial incentives are currently available in over 30 countries around the world, covering
more than 70% of today’s heating demand (IEA, 2022). Many of these grants, tax rebates andlow-interest loans for heat pumps in new buildings or as part of broader buildings
renovations have been introduced or strengthened since the beginning of the energy crisis.

3

Other measures to support a more rapid uptake of heat pumps, as envisaged in the NZE
Scenario, are new heat-as-a-service business models as well as revised building energy
performance and clean heat standards. In addition, energy tariffs and taxes can be structured
to favour cleaner and more efficient consumer choices. Addressing barriers such as ashortage of workforce for technology installation and restrictions or practical constraints for
new installations becomes even more pressing as upfront costs come down.

Electrification in industry
The industry sector currently accounts for more than 40% of global electricity demand.
Electricity is versatile and provides a diverse array of energy services in industry, e.g. heating,cooling, lighting, electrochemical processes and motor drives. The production of steel
recycled scrap and primary aluminium production all use electricity as the principal energy
input today. In the STEPS, industrial electricity demand rises by around 15% by 2030 asdemand for industrial outputs exceeds the rate of efficiency improvements. In the NZE
Scenario, a concerted push to electrify processes across all sub-sectors leads to a much bigger
increase in industrial electricity demand of 4 000 TWh, or 38% by 2030, 40% of which is inheavy industries (Figure 3.15).

Cost is the key potential barrier to achieving this. Fuel accounts for the majority of the totallife cycle cost of heating equipment, and industrial end-user prices for fossil fuels tend to be
substantially lower than electricity prices in most countries today. Industrial heat pumps,
which are more efficient than fossil fuel heating units, are able to bridge the cost gap in somecases, especially when complemented with captive solar PV electricity generation. Thermal
Chapter 3 | Making the NZE Scenario a reality

127

IEA. CC BY 4.0.

Heating applications offer the largest scope for increasing electrification in the industry
sector. Many of the technologies needed to substitute electricity for fossil fuels are alreadycommercially available for low (<100 °C) and medium (100-400 °C) temperature heat. In lightindustries, more than 90% of total heat demand falls within these ranges. Heat pumps,
electric boilers and resistance heaters – or combinations of all three – offer an efficientmeans of providing a wide range of temperatures for both direct heating and indirect heating
using steam. In the NZE Scenario, electrification of heating applications accounts for 45% of
the increase in electricity consumption in light industries to 2030.

storage technologies that can deliver heat directly to industrial processes at hightemperatures may be able to extend the reach of low-cost variable renewable electricity inthe industry sector, by-passing the grid. Nevertheless, cost remains an obstacle.
Figure 3.15 ⊳ Global electricity demand in industry by scenario, 2022-2030,

TWhand share of electricity in total energy demand by sub-sector in
the NZE Scenario, 2010-2030
60%

Share of electricity in total consumption
60%

4 000

40%

40%

2 000

20%

20%

6 000

Industrial electricity demandLight industry

Heavy industry

2022
2030 STEPS
2030 NZEElectricity share (right axis)

2010
Light industry
Cement2030
Iron and steel
Chemicals
IEA. CC BY 4.0.

Electrification in industry must go far beyond what is projected undercurrently planned policies to be in line with the NZE Scenario

Electrifying the provision of high-temperature heat (>400 °C) in industry is more difficult.
Electro-magnetic heating technologies, resistance heaters and electric arc furnaces arecommercially available options for specific applications. For many key industrial processes,
however, direct electrification technologies today generally are still at early stages ofdevelopment. Examples include direct electrification of heating in cement kilns, electricsteam crackers and electric iron ore electrolysis, the technologies for which are all at the
prototype stage (IEA, 2023e). In the NZE Scenario, innovation efforts related to thesetechnologies accelerate over the coming five years, with installation of the first commercialscale plants projected in the early 2030s.

128International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Energy performance standards and CO2 pricing are the most common policy mechanisms
currently employed to reduce industry sector emissions. These and similar measures can be
instrumental to adjust the operational cost balance in favour of commercially available
electrified equipment, notably industrial heat pumps. Various forms of policy support areneeded to commercialise earlier stage technologies to electrify processes in heavy industries,
such as grants for demonstration projects and concessional finance for initial deployment.

3.1.4

Reduce methane emissions

Rapid and sustained reductions in methane emissions are key to limit near-term global
warming and to improve air quality. Methane emissions have an outsized impact on global
temperatures in the short term, as methane is a short‐lived climate forcer with powerfulwarming potential, albeit with a short atmospheric lifetime. Therefore, cutting methane
emissions quickly would make a significant contribution to limiting the duration andmagnitude of the temperature overshoot above 1.5 °C.

3Methane is responsible for around 30% of the increase in global temperatures since theIndustrial Revolution. After CO2, cutting methane emissions has the single largest impact onlimiting the temperature rise to 2050 in the NZE Scenario (IEA, 2023f). Around 150 countries
have joined the Global Methane Pledge, which was launched at the Conference of theParties 26 in 2021 and aims to reduce methane emissions from human activity by at least
30% from 2020 levels by 2030. The energy sector accounts for around 40% of total methane
emissions attributable to human activity, second only to agriculture, and it has the largest
potential for abatement in the near term.
Figure 3.16 ⊳ Methane emissions from fossil fuel operations by region
Mtin the STEPS and by fuel in the NZE Scenario
STEPS

150

100

100

50

50

2010
Asia PacificNorth America

Middle EastCoal

Oil and gas

2022

2030
Eurasia

NZE

150

AfricaC & S America

2030
EuropeIEA. CC BY 4.0.

The gap in methane emissions between the STEPS
and NZE Scenario reaches more than 60 Mt by 2030

We estimate that fossil fuels were responsible for around 125 million tonnes (Mt) of
methane emissions in 2022, a slight increase over 2021 (Figure 3.16). Coal, oil and natural
gas were each responsible for around 40 Mt of emissions during production, processing,

Chapter 3 | Making the NZE Scenario a reality

129

IEA. CC BY 4.0.

Note: C & S America = Central and South America.

storage and transportation operations, and nearly 5 Mt of methane also leaked fromend‑use equipment. China accounts for over 50% of global coal supply and a similar share ofcoal mine methane emissions. The United States and Russia each emit nearly 14 Mt of
methane emissions from oil and gas operations, or around 35% of the total from oil and gas
operations between them. Many major emitters, such as China and Russia, have not yet
pledged to act on methane.
Methane emissions from fossil fuel operations fall by around 20% between 2022 and 2030
in the STEPS, mostly as a result of increasing political momentum to tackle these emissions
and voluntary industry action. Efforts to curtail emissions are already leading to a reductionin the amount of methane that is emitted per unit of energy produced globally. Emissions
from very large leaks detected by satellite fell by almost 10% in 2022 from the levels detected
in 2021 and there was a nearly 5% reduction in natural gas flaring globally. We estimate thatthe global average methane intensity of oil and gas production has fallen by around 5% since2019. But there is scope for much more to be done.
Several countries have released or are working on national methane action plans to support
reductions. Many of them have recently published landmark policies on methane, including
Colombia, Nigeria and the United States. Canada and the European Union are expected toissue new methane regulations in 2023. A number of oil and gas companies have set targets
to limit emissions or reduce their emissions intensity. In 2022, the Oil and Gas Climate
Initiative launched the Aiming for Zero Methane Emissions Initiative, a call for the industry
to treat methane emissions as seriously as it already treats safety and to reach near zeromethane emissions by 2030.

Methane abatement is very cost effective in the oil and gas sector. Based on average natural
gas prices from 2017 to 2021, we estimate that around 40% of methane emissions from oil
and gas operations could be avoided at no net cost because the outlays for the abatement
measures are less than the market value of the additional gas that is captured. If the record
natural gas prices seen around the world in 2022 are used for the calculations instead, we
estimate that about 80% of the options to reduce emissions from oil and gas operations
worldwide could be implemented at no net cost. In the NZE Scenario, around USD 75 billion
in cumulative spending is required to 2030 to deploy all methane abatement measures in theoil and gas sector (IEA, 2023g). This is equivalent to just 2% of the net income received by
130International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Methane emissions from fossil fuel operations fall by more than 75% by 2030 in the NZE
Scenario, mainly as a result of the rapid deployment of emissions reduction measures andtechnologies (Figure 3.17). These include measures that put a stop to all non-emergency
flaring and venting, and universal adoption of monthly or continuous leak detection andrepair programmes. A fall in demand for fossil fuels also plays an important role, particularly
in driving down coal mine methane emissions, though leaks from closed mines also need tobe addressed. By 2030, all producers have an emissions intensity profile similar to that of theworld’s best operators today. By 2050, the drop in methane emissions from fossil fuelsreaches 98% as a result of further technology development and demand reductions.

the oil and gas industry in 2022. Even if there was no value to the captured gas, an emissions
price of about USD 20/tonne CO2-equivalent would make almost all available abatement
measures cost effective.
Figure 3.17 ⊳ Methane emissions from fossil fuel operations and reductions
Mt

in the NZE Scenario, 2022-2030

125

Coal

3

Natural gas

100

Oil

75
50
25

2022

Intensity

Production

2030
IEA. CC BY 4.0.

By 2030, all fossil fuel producers have an emissions intensity profile
similar to that of the world’s best operators today

In the coal sector, wholesale methane reductions are generally more challenging than for oil
and gas operations. Around two-thirds of the reductions in coal mine methane emissions in
the NZE Scenario to 2030 come from a drop in coal consumption. Nonetheless, widespread
deployment of abatement measures should still be a priority. More than half of methane
emissions could be abated by making the most of coal mine methane utilisation, or by flaringor oxidation technologies when energy recovery is not viable. Mitigation action is particularly
important for coking coal, mainly used in steel making, which tends to come fromunderground mines where abatement is more feasible.

Chapter 3 | Making the NZE Scenario a reality

131

IEA. CC BY 4.0.

Tackling emissions from fossil fuels is not the only opportunity to cut methane emissions
from the energy sector. Achieving universal access to clean cooking and modern heating
would cut the methane emissions that arise from the incomplete combustion of bioenergy
as well as deliver numerous benefits for human health and well-being.

3.2

Accelerate long lead time options

3.2.1

Carbon capture, utilisation and storage

After years of underperformance, CCUS must now show it can deliver
CCUS is an important technology because it can reduce or eliminate emissions in areas whereother options are limited, for example in the production of cement or synthetic kerosene andin the removal of CO2 from the atmosphere. However, so far, the history of CCUS has largely
been one of unmet expectations. Progress has been slow and deployment relatively flat for
years. The current level of annual CO2 capture of 45 Mt represents only 0.1% of total annual
energy sector emissions. This lack of progress has led to progressive downward revisions in
the role of CCUS in climate mitigation scenarios, including the 2023 NZE Scenario.
Figure 3.18 ⊳ Global annual CO2 capture capacity by status and sector
Mt CO₂in the NZE Scenario, 2015-2030

1 000
750
500

Operational capture capacity
Announced capture capacity
CO₂ captured in the NZE

2030

2022

2021

2020

2019

2018

2017

2016

2015

250

Operational

Planned
2030

NZE
2030

Power
Other fuelIndustry
DAC

Hydrogen
IEA. CC BY 4.0.

Planned CCUS projects, if brought to fruition, would increase capacity over eightfold,about one-third of needed requirements by 2030
Notes: Mt CO2 = million tonnes of carbon dioxide; DAC = direct air capture. Includes all facilities with a capacity
larger than 0.1 Mt CO2 per year. Planned capacity for 2030 only includes projects with an announced operation
date by 2030. Hydrogen includes low-emissions hydrogen production at dedicated facilities, including for use
in ammonia manufacture. Captive low-emissions hydrogen production onsite at refineries and industrial
plants are included in other fuel and industry categories.

Since 2018, momentum on CCUS has increased on the back of stronger policies and improved
market conditions. Today over 45 countries have CCUS projects in development. If allannounced capture projects are built, around 400 Mt CO2 could be captured every year
globally by 2030 – more than eight-times current capacity. A number of capture projects arebeing developed for novel applications that are particularly important for reaching net zero132

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Source: IEA CCUS Projects Database, (IEA, 2023h).

emissions. Based on the current project pipeline, around 20% of capture capacity in 2030
would be for direct air capture (DAC), 20% for hydrogen production and 8% for industry(Figure 3.18). Planned capacities for CO2 transport and storage have also increased. Based on
the current project pipeline, CO2 storage capacity could reach over 420 Mt CO2 per year by2030. However, only around 20 commercial capture projects under development hadreached the stage of a final investment decision (FID) by June 2023; and even if all announced
projects proceed, they would provide around 40% of the annual CO2 capture of 1 Gt/year
needed by 2030 in the NZE Scenario.

3

Learning from the past, planning for the future
CCUS appeared poised for a major expansion following the 2008-2009 global financial crisis,
when more than USD 8.5 billion of public support was made available. Ultimately less than
30% of the funding was spent, and many CCUS projects could not advance fast enough to hit
the near-term spending milestones required by the support programmes. Limited one-off
capital grants, the absence of measures to address long-term liability for stored CO2, highoperating costs, limited social acceptability and vulnerability of funding programmes toexternal budget pressures all contributed to project cancellations. If CCUS is to makeprogress in line with the NZE Scenario, the industry needs to prove CCUS that can operate atscale. For their part, governments should develop effective support packages to help with
operating as well as capital costs and find realistic ways of managing the long-term liabilities
associated with CO2 storage.
Achieving the 2030 level of global deployment of CCUS in the NZE Scenario also hinges on
cutting project lead times, which currently average about six years. 2 Adoption of bestpractices could compress lead times to around three to four years, if CO2 transport andstorage infrastructure are already in place. Developing CCUS hubs could also help reduce
lead times (Box 3.3). A lead time of four years for both capture and storage would mean thatreaching 1 Gt CO2/year of global capture capacity by 2030 in line with the NZE Scenario would
require on average 160 Mt CO2/year of capture capacity and 140 Mt CO2/year of storage
capacity to start the planning stage each year between 2023 and 2026. Project
announcements in 2022 were just over this level for capture capacity and well above it forstorage, which indicates that the level of global CO2 capture and storage capacity required in
the NZE Scenario by 2030 is not out of reach, provided that the necessary steps are taken to
support it.

Unlocking CCUS deployment in emerging market and developing economies

2 Project lead time is defined here as the total time required between conception and commissioning of a
facility.

Chapter 3 | Making the NZE Scenario a reality

133

IEA. CC BY 4.0.

There are few CCUS projects in development in emerging market and developing economies(Figure 3.19). This represents an important hurdle to achieve the NZE Scenario, given thatemerging economies have large stocks of young emissions-intensive power plants andfactories.

Figure 3.19 ⊳ CO2 capture and storage capacity by economic groupingin the NZE Scenario, 2022 and 2030

Mt CO₂

Operational 2022

Planned 2030

NZE 2030

1 000

Unknown

800

Emerging market anddeveloping economies
Advanced economies

600
400
200
Capture Storage

Capture Storage

Capture Storage
IEA. CC BY 4.0.

Gap between the levels of planned CCUS deployment
and what is needed by 2030 is the largest in emerging economies
Note: Planned capture and storage capacity include all facilities with a capacity larger than 0.1 Mt CO2 per year
as of June 2023, and projects with an announced operation date by 2030.
Source: IEA CCUS Projects Database (IEA, 2023h).

Meeting NZE levels of CCUS deployment in emerging market and developing economies
requires around 130 Mt CO2/year of additional capture and storage capacity to start theplanning stage annually from 2023 to 2026. Such a rate of deployment is ambitious given thecurrent low number of projects in operation in those regions, but not unprecedented whencompared to other sectors such as unabated cement production, coal power or oil and gas
supply. Essential requirements for further progress include the development of legal andregulatory frameworks and the provision of incentives for the development of CCUS.

134

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Some progress in CCUS has been made in emerging market and developing economies, e.g.
around 20 new capture, transport or storage projects were announced in 2022 in Asia andthe Middle East. China produces more than half the world’s coal-fired power generation,
steel and cement, but has less than 5% of the world’s CCUS projects currently underdevelopment. China commissioned three projects in 2023 and has a project pipeline
equivalent to a capture capacity potential of around 10 Mt CO2/year. Indonesia finalised alegal and regulatory framework for CCUS in March 2023 – the first of its kind in Asia. The
Middle East, the location of over 15% of global natural gas production, has unique
opportunity to deploy CCUS for low-emissions fuel production, but currently accounts forless than 5% of global planned capture and storage capacity by 2030. Taken together, theannounced projects would only meet a small fraction of what is needed by 2030 in the NZE
Scenario.

Box 3.3 ⊳Role of CCUS hubs to achieve net zero emissions

Most CCUS projects commissioned to date have been managed by a single operator totransport CO2 from one capture facility to one injection site, which concentrates risks andcosts on one developer. But CCUS projects are increasingly being developed as part of
CCUS hubs, which consist of shared transport and storage infrastructure connecting
multiple emitters, often as part of an industrial cluster. Today there are over 110 storage
hubs in development, mainly in Europe and North America, with plans to sequester
around 280 Mt CO2 per year by 2030.

3

Figure 3.20 ⊳ CO2 emissions clusters and planned CCUS hubs in planning inNorth America, Europe, Middle East, and East Asia, 2022

North America

EuropeMiddle East

East Asia

IEA. CC BY 4.0.

Around 80% of global emissions from power plants, industrial facilities
and refineries could benefit from shared infrastructure

Sources: Analysis based on US EPA Office of Atmospheric Protection (2021); European Commission (2021);
Kearns et al., (2017); S&P Global (2022); Global Energy Monitor, (2022); Global Cement, (2022).

Chapter 3 | Making the NZE Scenario a reality

135

IEA. CC BY 4.0.

Notes: Point sources and CO2 emissions clusters include steel, cement, chemical, power generation andrefining in facilities with total emissions larger than 0.1 Mt CO2 per year. Sedimentary thickness (km) isused to indicate theoretical potential of CO2 storage sites.

The CCUS hub model spreads infrastructure costs between emitters and generates
economies of scale, allowing smaller emitters and those located far from identified CO2
storage sites to connect to shared infrastructure. Mainstreaming this model could help
to reduce lead times, as new capture facilities could connect to an existing CCUS hub. In
China, around 90% of emissions from steel, cement, power, chemicals facilities andrefineries are within 30 km of large industrial clusters 3 which could benefit from sharedinfrastructure. In the United States the equivalent figure is around 70%, and around 60%
in the Middle East and Europe.

3.2.2

Hydrogen and hydrogen-based fuels

Today hydrogen production is more of a climate problem than a climate solution. Demandfor hydrogen is rising, reaching 95 Mt in 2022, but most of it is met by emissions-intensive
supply, resulting in more than 0.9 Gt of direct CO2 emissions in 2022. Production of lowemissions hydrogen from water electrolysis or from fossil fuels with high levels of CO2
capture and storage amounted to less than 1 Mt in 2022 (IEA, 2023i).
There has been significant progress on policy and investment in low-emissions hydrogensince the 2021 version of the NZE Scenario (IEA, 2021b). Billions of dollars of support for
project developers have been budgeted by governments in a wide range of countries, andthe world’s largest installed electrolyser facility is more than ten-times bigger than the largest
one at the start of 2021. There is now enough confidence in the market to support several
investment decisions of more than USD 0.5 billion for low-emissions hydrogen production
projects. Included are three projects that together will produce ammonia from 0.2 Mt ofhydrogen from electrolysis from 2026 (91% in Saudia Arabia, 8% in Oman and 1% in the
United States). Despite the high expectations that have developed around hydrogen
recently, more action is urgently needed from policy makers and industry to deliver therequirements of the NZE Scenario.

Creating demand for low-emissions hydrogen3 Emitting at least 5 Mt CO per year.
2

136

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

In the absence of robust demand for low-emissions hydrogen, the current race to secure
market share for equipment such as electrolysers will have no winners. The NZE Scenario
sees demand scaled up first in existing applications where large quantities of low-emissionshydrogen can be integrated with minimal plant modifications and little need for new
infrastructure. This builds on recent experience: to date, most of the world’s largest financed
projects for hydrogen production from electrolysis or with CCUS have been designed to serve
existing demand, such as for fertiliser plants. But the level of demand for low-emissionshydrogen in existing applications is insufficient to reach the level called for by 2030 in the
NZE Scenario (Figure 3.21). New sources of demand are needed. Recently, some developers
have secured provisional agreements with prospective buyers, but announced plans forproduction of low-emissions hydrogen indicate that there is a risk of supply capacity
outstripping demand.

Mt H₂

Figure 3.21 ⊳ Global hydrogen demand in the NZE Scenario, 2022-2050
500

From unabated fossil fuels

Low-emissions hydrogen

400
300
200
100

2022 2030 2040 2050

New uses
Other
Road transport
Power generation
Aviation and marine fuelOther industry
Iron and steel
Chemicals
Existing uses
Iron and steel
Chemicals
Oil refining

32022 2030 2040 2050
IEA. CC BY 4.0.

Use of low-emissions hydrogen rises significantly to 70 Mt by 2030
and extends to new applications such as in aviation and shipping
Notes: Mt H2 = million tonnes of hydrogen. Unabated fossil fuels include hydrogen produced with CO2 capture
for utilisation without storage, such as in urea synthesis. Demand for aviation and marine fuel and power
generation includes hydrogen that is converted to make low-emissions hydrogen-based fuels.

In the industry sector, iron and steel production represents one of the important sources of
low-emissions hydrogen demand despite there being no such plants in operation today. In
the NZE Scenario, hydrogen-based direct reduction of iron (DRI) – a means of processing ironore without fossil fuels – leads to just over 4 Mt of low-emissions hydrogen demand by 2030.
The attainability of this scale-up is supported by an increase in new project announcements
for hydrogen-based DRI since 2021, when only one was in development. Some of these have
Chapter 3 | Making the NZE Scenario a reality

137

IEA. CC BY 4.0.

New applications represent more than four-fifths of low-emissions global hydrogen demandin 2030 in the NZE Scenario. These are at early stages of development or deployment today
yet are targeted by the expanding pipeline of announced projects. The largest sources ofdemand, ranked by size, are power generation (including storage), low-emissions hydrogenbased transport fuels, and iron and steel production. While hydrogen and ammonia are usedin just 1% of power generation in 2030, the sector represents a significant source of demand
due to its sheer size and the high value of clean, storable and flexible fuel to occasionallybalance the grid. In the longer term, increasing use of low-emissions hydrogen in aviation,
shipping and to a lesser extent heavy trucks means that transport becomes the largest sourceof hydrogen demand, and industry overtakes power generation as the second-largest sourceof demand.

been successful in securing provisional agreements with prospective buyers. Nonetheless,the 2030 level in the NZE Scenario is more than six times the implied demand of the current
project pipeline (Figure 3.22).
Figure 3.22 ⊳ Global low-emissions hydrogen demand from announced fuelMt H₂and iron and steel projects in the NZE Scenario, 2022-2030

H₂ for synthetic hydrocarbons

H₂ for DRI

5

NZE gap
4
3
2
NZE gap1

2022

Announced

2030

2022

Announced

2030
IEA. CC BY 4.0.

Announced projects that stimulate demand for low-emissions hydrogenare expanding rapidly, though they fall short of 2030 needs in the NZE Scenario
Notes: DRI = direct reduced iron. NZE gap = the difference between the sum of announced projects anddeployment needs in 2030 of the NZE Scenario. Synthetic hydrocarbons include low-emissions hydrogenbased fuels that are drop-in replacements for oil products.

In shipping, the use of ammonia or methanol as fuel for maritime vessels requires engine
modifications and fuel supply system development. While today there are no commercial
ships operating on ammonia, engine manufacturers have successfully tested the technology,
and around 150 ammonia-ready vessels were on order at the end of 2022. These ships
present an opportunity to rapidly develop the associated safety protocols. In the
138

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

In aviation, synthetic kerosene derived from hydrogen and CO2 has considerable potential asa drop-in fuel. From negligible quantities of production in 2022, this new application
increases in the NZE Scenario to more than 2 billion litres per year in 2030 (still less than 1%of aviation demand). This creates 1 Mt of hydrogen demand. Announced demandcommitments from the aviation industry to purchase volumes of this fuel fall far short of thelevels projected in the scenario, in part due to the lack of installed capacity. Trial operationof the first synthetic kerosene plant is expected in 2023, with first commercial-scale plants
due in 2025. The lead time to build a synthetic kerosene plant is two to four years.
Nevertheless, it will be challenging to build up capacity, secure supplies of carbon neutral
CO2 and low-emissions hydrogen, and establish off-take commitments in line with the
NZE Scenario.

NZE Scenario, orders of ammonia-ready vessels increase from the 2022 level on average by
about 20% per year to 2030, representing about 15% of typical annual vessel orders.
Agreements between shipping operators and ammonia and methanol producers will benecessary to bring supply and demand into line and to enable the use of low-emissionshydrogen in shipping to rise as rapidly as envisaged in the NZE Scenario.

Scaling up production
Meeting projected demand for low-emissions hydrogen in the NZE Scenario entails a rapidchange in how hydrogen is produced and a massive scaling up of production from the lessthan 1 Mt of low-emission hydrogen produced in 2022 (Figure 3.23). The current shortage ofequipment manufacturing capacity, production capacity, infrastructure, end-user systems
and market standards represent a series of obstacles to progress, as does the challenge ofmatching supply to demand during a period of rapid growth in production. There have beensome notable steps forward since 2021, especially in relation to water electrolysis, but muchremains to be done.

3

Figure 3.23 ⊳ Global hydrogen supply by source in the NZE Scenario,
Mt H₂2022-2050

400

Unabated fossil
fuels
By-product300

Low-emissions:fossil fuel with CCUS

200

Low-emissions:electrolysis

100

2022

2030

2040

2050
IEA. CC BY 4.0.

Low-emissions hydrogen production rises rapidly to reach 45%
of total hydrogen supply by 2030

The pipeline of projects for the deployment of electrolysis capacity looks encouraging,
though there is still a long way to go. If all announced projects come to fruition, more than
400 GW of electrolysis could be operational by 2030, which is around 70% of what is requiredin the NZE Scenario. However, more than half of the announced capacity corresponds to
Chapter 3 | Making the NZE Scenario a reality

139

IEA. CC BY 4.0.

Note: Other sources of low-emissions hydrogen, including from biomass, amount to less than 1% of the total
and are not shown here.

projects that are at very early stages of development and less than 4% are under constructionor have reached FID. The availability of renewable electricity is one potential constraint that
could hinder the rate at which projects start construction.
There have also been some encouraging signs in the outlook for manufacturing of theelectrolysers on which the increase in electrolysis capacity depends (Figure 3.24). If allannouncements from the private sector are realised on time, manufacturing capacity could
reach 155 GW per year by 2030, with cumulative production by this date of more than
450 GW of electrolysers. However, only 8% of these announcements of electrolyser
manufacturing capacity expansions have reached a FID and started construction. If
permitting processes run smoothly, as assumed in the NZE Scenario, it takes two to three
years to build a gigawatt-scale plant for manufacturing electrolysers and a further year or
two to install the electrolysers, so a rapid increase in manufacturing capacity is not out ofreach. Supportive government policies have been broadened to boost manufacturing
capacity as well as low-emissions hydrogen demand and deployment, including the US
Inflation Reduction Act, Europe’s Important Projects of Common European Interest and theEuropean Hydrogen Bank, and the UK Low-Carbon Hydrogen Business Model.
Figure 3.24 ⊳ Potential low-emissions hydrogen supply capacity from400

Electrolysis

CCUS
Billion USD (2022)

GW H₂ output

electrolyser and CCUS projects and investments in the
NZE Scenario, 2022 and 2030

300
200

160

Investment

120
80
40

100

2022 Projects Manuf. NZE
capacity

2022 Projects

Operational and under construction

Advanced stages

NZE
Early stages

2022

NZE
NZE

IEA. CC BY 4.0.

Notes: Projects in this figure represent the capacity of electrolysis and CCUS that could be installed by 2030 if
all the announced projects to produce low-emissions hydrogen are realised on time. Manuf. Capacity
represents the maximum capacity of electrolysis that could be installed by 2030 if all announcements to
expand manufacturing capacity of electrolysers are realised on time. To facilitate comparison between
electrolysis and CCUS-equipped capacity, values are shown in GW of installed capacity of hydrogen output,
which for electrolysis is 31% lower in 2030 than the equivalent value based on electricity input.

140

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Announced projects for electrolysis deployment account for around 70% of the 2030 needsin the NZE Scenario, but less than 4% of them have reached a final investment decision

There has also been some progress with low-emissions hydrogen production from natural
gas with CCUS, but here again there is much further to go. The five plants that have started
construction in North America since 2021 between them represent production capacity of
0.5 Mt each year, 70% from just two projects that are both incorporating over 90% CO2
capture and are equivalent to more than all the electrolyser capacity currently in operation.
However, slower progress in Europe, China and the Asia Pacific has led to a downward
revision of the contribution of low-emissions hydrogen from fossil fuels with CCUS in the2023 version of the NZE Scenario. It still calls for CCUS-equipped hydrogen projects
representing an annual production capacity of 17 Mt to reach FID by around 2026 for
operation by 2030, which requires an increase in the size of the current pipeline as well as
faster progress of projects through to FID.

3

The use of hydrogen envisaged in the NZE Scenario depends on investment in the production,transmission and distribution of low-emissions hydrogen and hydrogen-based fuels. This
currently stands at around USD 1 billion per year and needs to increase to USD 150 billion by
2030 to meet NZE levels, plus at least USD 100 billion in dedicated renewable electricity
capacity. Delivering this increase depends on getting the regulatory framework right and on
creating as much certainty as possible about future demand growth. Stimulating investment
in low-emissions hydrogen in emerging market and developing economies is likely to be
especially challenging. This group accounts for around one-quarter of announced projects,
but the majority of their projects are at very early stages of development and are struggling
to access finance. Multilateral development banks have started to provide funding forhydrogen projects, with programmes worth around USD 4 billion announced in 2023, but thisstill accounts for just 3% of the investment needed by 2030 in the NZE Scenario (IEA, 2023j).
More will need to be done if emerging market and developing economies (excluding China)
are to account for around 40% of cumulative investment in low-emissions hydrogen between
now and 2050, as envisaged in the NZE Scenario.

3.2.3

Bioenergy

Role of modern bioenergy

Most of the growth in modern bioenergy use in the NZE Scenario comes from the emerging
market and developing economies, where it almost doubles by 2030, growing at a rate thatis around one-third faster than in advanced economies (Figure 3.25). The main driver is the
Chapter 3 | Making the NZE Scenario a reality

141

IEA. CC BY 4.0.

Modern bioenergy is one of the pillars of the clean energy transition, growing from 6% of
total energy supply today to 13% in 2030 and 18% in 2050 in the NZE Scenario. All of theincrease comes from sustainable sources, which minimises impacts on biodiversity, water
resources and soil health, and helps to safeguard energy access and affordable prices for
agricultural outputs. One of the main advantages is that bioenergy is compatible with existing
infrastructure. Biomethane for instance is compatible with natural gas infrastructure, whilesolid bioenergy can be used in industries such as cement and power generation withrelatively few modifications. In addition, the raw materials used to make bioenergy, such as
agricultural and forestry residues, are broadly distributed across the world.

growth in liquid biofuel production, mostly consumed by the transport sector in developing
economies but also exported to advanced economies. Another key driver is the phase-out of
the traditional use of biomass in inefficient open cookstoves, which are replaced withmodern energy alternatives, including bioenergy used in more efficient cookstoves. The richbiomass resource potential in emerging economies also helps drive growth in modern
bioenergy uses in industry and the electricity sector. While bioenergy is used in a number ofsectors, it plays a particularly important role in the transport sector, where its share ofdemand for liquid fuel transport increases from almost 4% today to over 10% by 2030. Thisis driven primarily by demand in passenger cars, heavy-duty trucking, long-haul aviation andinternational shipping.
Figure 3.25 ⊳ Primary bioenergy use by sector and economic groupingin the NZE Scenario, 2010-2050

EJ

Bioenergy use by sector

Bioenergy use by economy type

100

20%

100

80

16%

80

60

12%

60

40

8%

40

20

4%

20

2010 2022 2030 2040 2050
Modern solid bioenergy
Power and heat
Industry
Buildings and agriculture

Liquid biofuels
Biogases
Conversion losses
Traditional use of biomass
Share in TES (right axis)

2010 2022 2030 2040 2050
Traditional use of biomass
EMDE
Advanced economies

IEA. CC BY 4.0.

Modern bioenergy use in emerging market and developing economies
almost doubles to 2030, rising 30% faster than in advanced economies
Note: TES = total energy supply.

The expansion of modern bioenergy involves trade-offs between bioenergy supply,
sustainable development goals and other land uses, notably food and feed production. The
maximum level of bioenergy used in the NZE Scenario (100 EJ) takes these trade-offs into
consideration and is based on assessments of the global sustainable bioenergy potential(Creutzig, 2015; Frank, 2021; IPCC, 2014; IPCC, 2019; Wu, 2019).
142

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Ensuring a sustainable supply of bioenergy

There is a shift in the NZE Scenario from conventional feedstocks towards advanced
bioenergy feedstocks to avoid land-use conflicts. Advanced feedstocks from waste andresidues such as agricultural residues, forest and wood residues and the organic fraction ofmunicipal solid waste do not require dedicated land use. From 2030 onwards, a growing
reliance on advanced feedstocks means that over half of the total biomass feedstock supply
comes from sources with no dedicated land use.
The remaining feedstocks – for both conventional and advanced bioenergy – do require
dedicated land use, but can still be produced in a sustainable way. Modelling done incollaboration with the International Institute for Applied Systems Analysis 4 indicates that therequirement for bioenergy crops in the NZE Scenario could be met without encroaching onforested land, and that by 2050 there is no overall increase in cropland 5 use for bioenergy
production from current levels. Total land use for bioenergy in the NZE Scenario is well below
estimated ranges of potential land availability that take full account of sustainability
constraints, including the need to protect biodiversity hotspots and to meet the UN
Sustainable Development Goal 15 on biodiversity and land use. The certification of bioenergy
products and strict control of what land can be converted to expand forestry plantations andwoody energy crops nevertheless is critical to avoid land‐use conflict issues.

3

Short-rotation woody energy crops provide a steadily growing share of bioenergy supply in
the NZE Scenario, providing just under 40 EJ of bioenergy in 2050: these crops are cultivatedon cropland previously used for conventional biofuels, pastureland and marginal lands andcan produce twice as much bioenergy per hectare as many conventional bioenergy crops.
The remaining modern bioenergy comes from sustainably managed forest plantations andsustainable tree planting integrated with agricultural production via agroforestry systems:
these do not conflict with food production or biodiversity.

How quickly can the use of biofuels expand?
The prospects for demand for liquid biofuels depend largely on policy mandates. Most
biofuels can be blended at high rates with relatively few modifications. In the case ofrenewables diesel, no blending is required as it can be used interchangeably withconventional, oil-based diesel. However, in most countries, blending rates are low, due tothe high cost of liquid biofuels and limited policy support. More than 80% of biofuels are
currently used in the United States, Brazil, Europe and Indonesia, where a mix of regulations,financial incentives and technical standards have supported their expansion. However, thesupportive policy frameworks in these regions need to be strengthened to help expand
demand, which more nearly triples by 2030 in the NZE Scenario. They also need to be
replicated elsewhere, especially in emerging market and developing economies where

5 Cropland here refers to agricultural land used for food, animal feed and bioenergy production but excludes

short-rotation woody crops not established on existing agricultural cropland.

Chapter 3 | Making the NZE Scenario a reality

143

IEA. CC BY 4.0.

4 IEA model results have been coupled with the International Institute for Applied Systems Analysis (IIASA)
Global Biosphere Management Model (GLOBIOM) to provide data on land use and the greenhouse gas
emissions from bioenergy production.

biofuel demand rapidly increases in the NZE Scenario. The volumetric share of ethanol ingasoline jumped in India from 4% in 2019 to more than 10% in 2022, which provides anexample of what can be done.
Global liquid biofuel production is not currently on track to deliver what is required by 2030
in the NZE Scenario, based on current market trends and policies. Output has increased on
average by 4% per year over the last five years, but it needs to increase by an average of 13%
per year to reach the 11 EJ projected for 2030 in the NZE Scenario (Figure 3.26). Biomassbased diesel, for instance, has expanded at an average of 9% worldwide for the past five
years. Existing and announced projects would cover half of the increase in demand, assuming
they all go ahead, but new facilities take only around two to three years to build, whichmeans that there is still time for additional projects to fill the gap.
Figure 3.26 ⊳ Liquid biofuel production by economic grouping in the
EJ

NZE Scenario, 2018-2030

Announced

12

NZE
Emerging market
and developing
economies

10

Advanced
economies

8
6
4
2
2018 2019 2020 2021 2022

2028

2030
IEA. CC BY 4.0.

A key barrier to raising liquid biofuel output is the limited availability of sustainable
feedstocks. The total potential resource base of all kinds of sustainable bioenergy (solid,
liquid and gaseous) is estimated at around 100 EJ, of which only 10 EJ (including conversion
losses) is currently used to make biofuels. However, the pace and scale of expansion in the
NZE Scenario is contingent on producing biofuels from a broader set of feedstocks than thoseused today. In 2030, 40% of production is based on what are known as advanced feedstocks,
i.e. materials that do not compete with food and feed production. These advanced
feedstocks include crops grown on marginal land, agricultural and forestry residues andresidue oils, fats and grease. By 2050, their share of total production reaches 75%. Advanced
feedstocks today support 12% of biofuel production and come primarily from residue oils,
144

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Liquid biofuel output in both economic groupings more than doubles by 2030
of which the existing project pipeline could cover 50%

fats and grease such as used cooking oil. But the existing project pipeline would use morethan 90% of the estimated supply of these residues. Achieving the increases in supply
projected in the NZE Scenario therefore requires higher reliance on other kinds of advanced
feedstocks, in particular agricultural and forestry residues.
Box 3.4 ⊳Expanding access to feedstocks is key to increasing biofuels

Biofuel producers and governments have an opportunity to expand the feedstock baseused to make liquid biofuels. This requires a focus on five broad areas:
Enhance land productivity: Intercropping, cover crops, growing crops on marginalland and improving crop yields all hold potential to expand supply of feedstock. For
instance, woody short-rotation coppice can produce twice as much bioenergy perhectare as conventional bioenergy crops. Over the past two years, seven majorenergy companies, including ExxonMobil, Eni, Chevron Corporation and BP haveannounced projects and partnerships to develop these feedstocks.



Improve waste and residue collection: An estimated 20 Mt of residue oils, fats andgrease are generated each year that are compatible with commercial biodiesel andrenewable diesel production technologies, and which could be directed towards
biofuel production. Companies are already working to gather these wastes.
Additional efforts are also needed to access woody residues from agriculture andforestry. Collection can be facilitated by building facilities close to sources of supply,
as companies are doing at some sugar mills in Brazil and India, and at some forestry
plantations in the United States. Improved data, co-ordination and business models
can help with efforts to collect dispersed residue feedstocks.



Deploy technologies that can process various feedstocks: Global efforts are needed
to commercialise and expand technologies that can convert the feedstocks tobiofuels at scale. Some efforts are underway. For example, Brazil and India arebuilding seven cellulosic ethanol projects that use agricultural residues to create
ethanol, while a plant that converts forestry residues into biojet kerosene is being
built in the United States.

Reduce the life cycle emissions intensity of biofuels: CCUS, facility improvements,
and taking account of the life cycle carbon intensities of various feedstocks (including
carbon sequestered in soil) all offer pathways to reduce greenhouse gas emissions
from every litre of biofuels produced. For instance, in the United States CO2transport pipelines are planned that would connect around 30 ethanol facilities with
CO2 storage.



Develop and implement performance-based sustainability frameworks: Efforts to
expand feedstock supplies need to be accompanied by performance-basedsustainability frameworks which include carbon assessment methodologies. The
development of such frameworks will play a critical role to ensure that efforts to
expand biofuels are both effective and sustainable.

Chapter 3 | Making the NZE Scenario a reality

145

IEA. CC BY 4.0.

3

3.2.4

Infrastructure

Rapid expansion of existing infrastructure plus development of new infrastructure for
emerging technologies are both required
Electricity networks – the backbone of power systems – are central to clean energy
transitions. Increasing population, rising incomes and electrification of more and more enduses that previously used fossil fuels combine to considerably push up demand for electricity.
Rapid growth in the share of electricity generated by variable renewables, in particular solar
PV and wind, bring new challenges to ensure power system flexibility and stability. Significant
electricity grid changes are needed, particularly as storing electricity is challenging and costly.
New transmission and distribution lines will have to be built. In 2022, the length of electrictransmission and distribution lines worldwide totalled around 80 million km. This needs toexpand 20% by 2030 in the NZE Scenario (Figure 3.27). Digitalization, smart systems andadvanced semiconductor technologies each play a crucial role to ensure and improve control
and stability of power flows, and will have to be factored into plans for new lines as well as
to be integrated into existing grids. Grids also play a pivotal role in enhancing the flexibilityof the power system, enabling the integration of variable renewable and distributed energy
resources (see section 3.1.1). Energy transitions could be stifled if the current pace of griddevelopment does not accelerate, slowing the uptake of renewables, raising fossil fuel use
and associated CO2 emissions (IEA, forthcoming).
Figure 3.27 ⊳ Global infrastructure needs for electricity, hydrogen and

75
50

Electricity grids

25

2022
2030
Transmission Distribution

600

Hydrogen tankers
Thousand km

100

Number of tankers

Million km

CO2 storage in the NZE Scenario, 2022 and 2030

450

60
45

300

30

150

15

2022
LNG today

2030
LH₂ NH₃

CO₂ pipelines

2022

2030
CO₂
IEA. CC BY 4.0.

Notes: LNG = liquefied natural gas; LH2 = liquefied hydrogen; NH3 = ammonia. The hatched area for CO2
pipelines represents the NZE Scenario range of 30 000-50 000 km.

146International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Infrastructure to transport and store electricity, hydrogen and CO2
is an often overlooked but critical enabler of clean energy transitions

Today hydrogen is mostly produced close to where it is used. As demand increases in the NZE
Scenario, it is likely to become cheaper to produce some low-emissions hydrogen in areas
with good renewable energy resources and transport it to demand centres. Pipelines cantransport large volumes of hydrogen efficiently over hundreds of kilometres, and these could
include repurposed natural gas pipelines. For longer distances, hydrogen may need to beconverted into a denser form, either through liquefaction (LH2) or conversion into a chemical
carrier that can be easily shipped, e.g., ammonia, methanol, synthetic fuels or a liquid organichydrogen carrier. Increasing demand for low-emissions hydrogen means that more than
20 000 km of pipelines are needed by 2030 in the NZE Scenario, compared with 5 000 km
today, together with around 25 LH2 tankers (160 000 m3), up from zero today, and around70 new ammonia tankers, up from the current 40 tankers that carry ammonia year round.

3

CCUS deployment is hindered by a lack of available CO2 storage sites. Assessing anddeveloping potential sites, including saline aquifers and depleted oil and gas fields, is often atime-intensive and expensive process, but it is vital: without appropriate storage sites it will
be much harder to develop other parts of the value chain, including CO2 pipelines. CO2
storage capacity expands in the NZE Scenario from less than 50 Mt today to around 1 Gt by2030 – a more than a 20-fold increase – while CO2 pipeline infrastructure expands fromaround 9 500 km today to between 30 000-50 000 km by 2030.

How feasible is the ramp-up of infrastructure to 2030 in the NZE Scenario?
The rapid ramping up of infrastructure requirements envisioned in the NZE Scenario istechnically feasible, but nonetheless represents an enormous undertaking.
Electricity grids are already accelerating. Over the past five years, the transmission anddistribution grids worldwide expanded by 1.9 million km each year – a rate of increase about
9% higher than experienced in the 2013-2017 period. The pace picks up in the NZE Scenario
as grids expand by around 2 million km each year to 2030 (Figure 3.28).

In the case of hydrogen, the fertiliser industry already ships ammonia in tankers designed tocarry liquefied petroleum gas (LPG), but dedicated LH2 tankers are not yet commerciallyavailable, and some innovation will be required to overcome the additional challenges of thelower boiling point of hydrogen compared with natural gas, and the use of hydrogen boil-off
as fuel. The projected pace of global expansion in LH2 and ammonia shipping in the
Chapter 3 | Making the NZE Scenario a reality

147

IEA. CC BY 4.0.

The deployment of transport and storage infrastructure for hydrogen and CCUS depends ona number of factors, including how quickly technologies that are still at the demonstration
stage can achieve commercialisation, e.g. LH2 shipping, ammonia cracking, as well as
development of regulatory frameworks, permitting rules and public acceptance. If lead times
for hydrogen and CCUS infrastructure projects are roughly on a par with those for previous
natural gas infrastructure projects, infrastructure development may hinder the production
and demand projects to which they are linked. Repurposing existing oil and gas assets,
including natural gas networks, shipping terminals and offshore platforms, could help to fast
track the deployment of hydrogen and CO2 infrastructure, reduce lead times and investment
costs.

NZE Scenario is similar (in energy terms) to the speed of LNG expansion during its first decadeof development. How quickly LH2 tankers can be deployed is uncertain, as the technology is
not mature, but the NZE Scenario only calls for around 4 LH2 tankers by 2030, around a tenth
the number of LNG tanker deliveries in a given year with a similar size in volumetric terms.
In the case of CCUS, there are ample potential global CO2 storage resources, but further
resource assessment is required to develop sites. Based on current project pipelines,
CO2 storage capacity could reach more than 420 Mt CO2 per year by 2030, around 40% ofwhat is required in the NZE Scenario. CO2 pipelines currently under development would
provide around 30-50% of what is needed in the NZE Scenario, with around 15 000 km underdevelopment worldwide. This could increase as projects move forward since not all
announced projects have specified pipeline lengths yet.
Figure 3.28 ⊳ Annual global deployment of additional electricity lines,

1.8
1.2
0.6

2018-22 2026-30
Distribution
Transmission

80

Annual tanker deliveries
Mt CO₂

Annual grid net additions
2.4

Number of tankers

Million km

hydrogen tankers and CO2 storage in the NZE Scenario
compared with historic trends

60

1 000
750

40

500

20

250

LNG LPG
2015-19

LH₂ NH₃
2026-30

CO₂ storage, 2030

Projects

NZE

In development
Operational
IEA. CC BY 4.0.

Grid additions to 2030 are close to historic rates; roll-out of liquefied hydrogen tankers
and CO2 storage relies on emerging technologies and available resources

The planning and permitting processes for major new clean energy infrastructure typicallytake three to eight years to complete before construction can start and could be longer for
first-of-a-kind projects (Figure 3.29). In the case of electricity lines and pipelines, line routeplans may need to be assessed by a multitude of regulatory authorities, jurisdictions andother stakeholders. When involving new types of infrastructure, such as storage sites for CO2,
it is not always clear which regulator should be in charge of the permitting process. As large
148

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Notes: LNG = liquefied natural gas; LPG = liquefied petroleum gas; LH2 = liquefied hydrogen; NH3 = ammonia;
NZE = Net Zero Scenario. CO2 storage project capacity in 2030 includes projects currently in operation plus
those in development.

infrastructure projects often cross or impact multiple landowners, early and frequent
stakeholder engagement and an appropriate communication strategy are required tominimise potential increases in lead times due to public opposition. As highlighted in the IEASpecial Report on Grids (forthcoming), there is evidence of permitting bottlenecks forcing
the delay of some large electric transmission line projects. However, there are some signs ofrecognition of the urgent need to expedite permitting of clean energy infrastructure.

CO₂ Hydrogen

Electricity
grids

Figure 3.29 ⊳ Typical lead times for selected infrastructure projects

3

Underground transmission line
Overhead transmission line
Subsea transmission cable
Underground distribution line
Overhead distribution line

Onshore pipeline
Terminal
Tanker
CO₂ storage
2

4

6

Planning and permitting

8
Construction

10

12
Years

IEA. CC BY 4.0.

On average, construction takes between one to four years, while planning and permitting
may take three to eight years and can create bottlenecks and cause delays
Notes: Electricity grid lead times are based on average lead times in Europe and United States. Transmission
refers to extra-high voltage, ranging from 200-765 kV. Hydrogen terminal lead times are based on averagelead times for LNG terminals in Europe and Asia. Hydrogen tanker lead times are based on lead times for an
LNG tanker.

3.3 Consequences of further delays for the clean energy
transition

6 High overshoot refers to an increase in global average temperature above 1.6 °C but below 1.8 °C above pre-industrial levels and a subsequent fall to below 1.5 °C. (IPCC, 2023).

Chapter 3 | Making the NZE Scenario a reality

149

IEA. CC BY 4.0.

Failure to accelerate the clean energy transition along the lines of the pathway depicted in
the NZE Scenario would virtually guarantee a high overshoot of the 1.5 °C limit, 6 with serious
consequences for humans, ecosystems and climate tipping points. In such circumstances,
returning the global average temperature rise to below 1.5 °C by 2100 would require a large
and costly deployment of CO2 removal technologies and would not avoid the need to reducefossil demand substantially in this decade. Raising climate ambitions and ensuring effective
implementation must remain critical priorities.

3.3.1

The world has already delayed too long to avoid hard choices

The NZE Scenario can only be achieved with substantial changes to operating patterns andthe early closure of some existing fossil fuel-based infrastructure. If current energy sector
assets were to be operated until the end of their normal technical and economic lifetimes,
and in the same manner in which they have been operated, they would generate further
cumulative emissions of around 600 Gt CO2 over the period 2023 to 2050 (Figure 3.30). Thisis far more than the estimated remaining CO2 budget to remain below 1.5 °C. This has
implications for China given that it accounts for 45% (270 Gt CO2) of the emissions fromexisting assets over this period, primarily owing to its large fleet of relatively young coal-fired
power plants and the size of its industrial base, which has the capacity to produce more thanhalf the global demand for crude steel and cement. It also has implications for thosecountries, including India among others, that have significant additional emissions-intensive
capacity under construction or planned to come online in the next few years. But it is also an
issue that all countries worldwide will need to confront if they intend collectively to get to
global net zero emissions by 2050. On the supply side, the rate of reduction in oil and gas
demand necessary to reach net zero emissions by 2050 is now so fast that it may imply theearly closure of some existing oil and gas fields.
Figure 3.30 ⊳ Global energy sector CO2 emissions from existing assets

Gt CO2by sub-sector and region assuming no early retirements ormodifications
Emissions

40

320

30

240

20

160

10

80

2010
Coal power

2022
Other power

Cumulative emissions, 2023-2050

Advanced China
India
Rest ofeconomies
world
CementChemicals
Other industry
Other

2050
Steel

IEA. CC BY 4.0.

Absent early retirement or modifications in operations, existing assets would emit
600 Gt CO2 in the 2023-2050 period, dashing any hope of staying below 1.5 °C

Further delaying the hard choices necessary to reach global net zero emissions by 2050
would make the problems substantially worse, and much harder to solve. Between 2023 and150

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Note: AE = advanced economies.

2035, cumulative investments in fossil fuel supply, fossil-based power generation and enduses are currently planned to be USD 3.6 trillion higher than in the NZE Scenario, despite
current net zero emissions pledges. Much of this investment would be for assets with long
lives in which operations would need to be curtailed or lifetimes shortened if the goal of
returning the temperature increase to below 1.5 °C is to be achieved.

3.3.2

Implications of not raising climate ambitions to 2030

3

The net zero emissions pledges that have been announced by countries around the world –even if they are all implemented in full and on time – would make it impossible to limit global
warming to 1.5 °C without high overshoot (see Chapter 1). This raises the question ofwhether global warming could be brought back to below 1.5 °C after a high overshoot, andif so, at what cost. In order to explore this question, the IEA developed the Delayed Action
Case. It assumes that all countries that have announced net zero emissions pledges
implement policies in the period to 2030 that enable achievement of their pledges. This is inline with the IEA Announced Pledges Scenario (APS). In fact, the policies that have been put
in place are not sufficient to achieve the APS, and moreover we cannot be sure that all thepolicies that have been put in place will be maintained and fully implemented. Therefore,
the starting point of the Delayed Action Case is more optimistic than current policy settingsand Nationally Determined Contributions. The findings discussed in this section in terms ofthe challenges of bringing global warming back below 1.5 °C need to be seen in that context.
In the Delayed Action Case, countries are assumed to undertake actions that go beyond what
is currently factored into the APS and accelerate their implementation of more ambitious
climate policies after 2030, particularly where they have significant technological andfinancial capacities. This reduces global energy sector CO2 emissions by just over one-thirdby 2035, relative to the 2022 level. This compares with the nearly two-thirds reduction
projected in the NZE Scenario over the same period. Although policies become increasingly
stringent over time, the delayed and uneven actions across sectors and regions mean thatenergy sector CO2 emissions reach net zero only by the middle of the 2060s. As a result, theglobal temperature rise climbs to a peak close to 1.7 °C around 2050. After this time, thetemperature falls by about 0.05 °C per decade due to net CO2 removals from BECCS and
DACS, cuts to methane emissions in the previous decades, and a reduction in atmospheric
CO2 due to natural processes (see Chapter 2). This brings warming to below 1.5 °C by 2100
(Figure 3.31).

7 High confidence = 80% chance.

Chapter 3 | Making the NZE Scenario a reality

151

IEA. CC BY 4.0.

The rise in temperature in the Delayed Action Case exceeds 1.6 °C for about 25 years and
1.5 °C for almost 50 years, which has a number of potentially serious consequences forvulnerable populations, ecosystems and climate tipping points. According to theIntergovernmental Panel on Climate Change (IPCC), if a temporary overshoot of the 1.5 °C
threshold occurs, then there is high confidence 7 that “…many human and natural systems
will face additional severe risks, compared to remaining below 1.5 °C”. These risks are mainlyassociated with irreversible changes to ecosystems and with the release of additional
greenhouse gases (IPCC, 2023).
Figure 3.31 ⊳ Median global temperature rise in the Delayed Action Case°C

and the NZE Scenario

1.7
Delayed Action Case
1.6
1.5
NZE
1.4
1.3
1.2

2020

2040

2060

2080

2100
IEA. CC BY 4.0.

Even a small delay in stronger action to cut emissions beyond current pledges
would cause global temperature to exceed 1.5 °C for almost 50 years
Source: IEA analysis based on outputs of MAGICC 7.5.3.

Threats to ecosystems and biodiversity are likely to persist for many decades after
temperatures start to decline. In more than one-quarter of global locations the chances thatanimal and plant species can return to pre-overshoot “normal” are either uncertain or
non-existent (Meyer et al., 2022).
Additional global warming comes with heightened risks of triggering tipping points in theearth system, i.e., large scale, irreversible events such as the melting of ice sheets or theabrupt dieback of the Amazon rainforest (Wunderling et al, 2022). The risks of positive
feedback loops in the climate system, combined with inherent uncertainties in the earth’s
response to future greenhouse gas emissions and net CO2 removals, mean that there is a
one-third chance of the temperature rise exceeding 1.8 °C in the Delayed Action Case.

What would it take to bring temperatures back below 1.5 °C?

In the Delayed Action Case, bringing the global increase in average temperatures back down
to below 1.5 °C would require scaling up CO2 removal from the atmosphere throughbioenergy equipped with CCUS (BECCS) and direct air capture and storage (DACS) to over
5 Gt CO2 every year during the second-half of this century (Figure 3.32). This is equivalent tothe annual energy sector emissions of the United States today and compares with projected
152

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

3.3.3

removals which reach 1.7 Gt in 2050 in the NZE Scenario. The Delayed Action Case assumes
that this requirement is split between BECCS, which delivers 2 Gt a year in 2100, and DACS,
which delivers 3.3 Gt a year in 2100.
Figure 3.32 ⊳ Global gross and net energy sector CO2 emissions
Gt CO₂in the Delayed Action Case40

3Net emissions
30
20
10
0

Gross emissions
BECCS and DACS

-10
2020

2040

2060

2080

2100
IEA. CC BY 4.0.

Delaying the achievement of net zero emissions to after 2060 would mean that up to 5 Gt
per year of CO2 removals would be needed to bring temperatures to below 1.5 °C

The 2 Gt CO2 removal each year through BECCS required in the Delayed Action Case is twice
the amount required in the NZE Scenario. The extent to which BECCS can be increased isconstrained by limits on sustainable bioenergy supply as well as by the economic andlogistical challenges of deploying infrastructure to connect bioenergy facilities, often very
dispersed, with large-scale CO2 storage sites. Capturing 2 Gt CO2 per year from bioenergy
facilities would require gathering, processing, combusting, capturing, transporting andstoring the emissions from bioenergy produced on roughly 135 million hectares (Mha) 8 ofland – slightly less than the total land area of Peru, the 20th largest country in the world(Figure 3.33). As sustainable bioenergy feedstock is spread thinly and widely, so arebioenergy facilities, and connecting them with CO2 transport infrastructure and suitablestorage sites would be a huge challenge in logistical terms.

8 Estimated by applying the share of bioenergy feedstock used in facilities equipped with CCS to total bioenergy
land use. Land use for bioenergy includes cropland for first- and second-generation energy crops, andsustainably managed forest land for bioenergy estimated on a pro rata basis (i.e., the proportion of feedstocks
used for bioenergy production out of total forest harvest).

Chapter 3 | Making the NZE Scenario a reality

153

IEA. CC BY 4.0.

While the deployment of DACS is not restricted by the availability of feedstock or suitablesites, it is much more energy intensive and costly than BECCS. This is mostly due to the low
concentration of CO2 in the atmosphere, which requires huge volumes of air to be treatedfor CO2 separation. Capturing around 3.3 Gt CO2 directly from the atmosphere as required in
the Delayed Action Case by 2100 would require filtering 0.1% of the earth’s atmosphere
every year. At this scale, DACS would consume around 30 EJ of energy annually, just below
than current total energy consumption in the industry sector in the European Union, Japanand United States combined. If the energy required for the deployment of DACS wasprovided by solar PV, this would require around 4.5 Mha of land for solar PV and DACS
facilities, which is roughly equivalent to the land area of Denmark. While this is orders ofmagnitude lower than the land and water footprints typically associated with bioenergy
production, it would put further strains on an already resource-constrained energy system.
Figure 3.33 ⊳ Global annual energy use, annual carbon removal costs
and land requirements for carbon removal technologies
in the Delayed Action Case, 2100

40Energy use (EJ)

1.6

Cost (Trillion USD)BECCS feedstock area (Mha)160
Peru land area

2022 industry
30
energy demand in
EU, US and Japan

1.2

20

0.8

80

10

0.4

40

NZE
Scenario

DelayedAction Case

BECCS

2022 fossil fuelinvestment

NZE
DelayedScenario Action Case

120

DACS

NZE
DelayedScenario Action Case
IEA. CC BY 4.0.

Heavier reliance on Carbon Dioxide Removal in the Delayed Action Case would
have huge implications for energy use, economic costs and resource use
Notes: EJ = exajoules; Mha = million hectares; EU = European Union; US = United States; BECCS = bioenergy
equipped with CCUS; DACS = direct air capture and storage. Energy and costs for BECCS are for the carbon
capture unit only. Cost corresponds to the levelized cost of carbon capture. BECCS feedstock area refers to theland area from which BECCS feedstock must be collected. The Delayed Action Case assumes that totalsustainable bioenergy limit does not increase from the NZE Scenario (100 EJ), but the share of bioenergy
combined with CCUS increases.

154

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

There is also the question of cost to consider. Removing 2 Gt with BECCS and 3.3 Gt withDACS each year by the end of the century would cost around USD 1.3 trillion per year (in2022 dollars), 50% more than was invested in fossil fuel supply in 2022. Organising this scaleof resource mobilisation would be a major challenge requiring close international cooperation.

S P O T L I G H T
Status of direct air capture and storage technology
Direct air capture and storage is a promising technology for net zero emissions pathways,
but it cannot substitute for deep reductions in emissions or delays in developing anddeploying the technologies that can reduce or avoid emissions in the first place. The
industrial, infrastructure and cost challenges of scaling up direct air capture and storage
to the degree in the Delayed Action Case highlight the need to minimise its use as muchas possible by prioritising direct reductions of emissions from fossil fuel combustion andnon-combustion applications alike, as in the NZE Scenario.

3

Even with the very rapid emissions reductions built into the NZE Scenario, DACS plays animportant role in balancing the last remaining residual emissions. It also plays animportant role in capturing CO2 directly from the atmosphere that provides the necessary
and irreplaceable climate neutral carbon feedstock for low-emissions fuels such assynthetic aviation kerosene (given constrained sustainable bioenergy resources), whichplay a vital part in the aviation sector. Policy makers should support faster innovation inand deployment of DAC technologies, even as they prioritise the deployment of clean
technologies across the energy system.
Two technological approaches are currently being used to capture CO2 from the air: solid
DAC (S-DAC) and liquid DAC (L-DAC). Solid DAC operates at ambient to low pressure andmedium temperature (80-120 °C), while liquid DAC operates at high temperature(300-900 °C). These technologies are currently at the prototype (L-DAC) anddemonstration (S-DAC) stages and need to be scaled up dramatically to play the roleenvisaged in the NZE Scenario (see section 3.2.1).

Growing commercial interest in the L-DAC and S-DAC technologies, as well as theinnovation potential of emerging DAC technologies, suggests that DAC technologies
could be scaled up to the levels seen in the NZE Scenario, provided that appropriate
policies are in place. At the same time, policy makers and industry need to be realistic
about the role that DACS and other carbon dioxide removal technologies can play inrobust net zero emissions strategies, and about the risks involved in making assumptions
about their future development. Time is not on our side. Even with substantial innovationand deployment, these technologies must be seen as a way of complementing, notreplacing, a focus on reducing emissions.
Chapter 3 | Making the NZE Scenario a reality

155

IEA. CC BY 4.0.

Other interesting DAC technologies are emerging such as electro-swing adsorption,
zeolites and passive DAC. While these DAC technologies are now at early stages ofdevelopment, they offer the possibility of lower costs (passive DAC could cost less than
USD 100/t CO2 compared with USD 1000/t CO2 for the DAC technologies at a moredeveloped stage today), lower energy intensities (electro-swing DAC needs only around
one-third of the energy per tonne of CO2 compared with more developed technologies)
and abundant sorbent availability (global zeolites production in 2022 was equivalent toaround 1 Mt).

3.3.4

Implications for the oil and natural gas industry

With continuing investment in existing and approved sources of supply, but without any new
conventional oil and gas project approvals, oil and gas production would decline by around
2% each year on average to 2030 and by 4-5% each year on average from 2030 to 2050.
In the NZE Scenario, a rapid and sustained surge in clean energy investment and a variety ofother measures lead to reductions in demand for oil and gas that broadly match the
projected fall in production from existing sources of supply. As a result, there is no need forthe approval of any new long lead time upstream conventional oil and gas projects.

156International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

In the Delayed Action Case, clean energy investment takes place less rapidly and measuresdesigned to reduce emissions progress more slowly. As a result, oil and natural gas demand
fall by around 0.5% on average each year to 2030. After 2030, oil and gas demand declines
at a rate closer to 4% per year on average through to 2050. To ensure a smooth match
between supply and demand there would need to be continued investment in existingsources of oil and gas supply, and some new sources of supply would need to be approvedfor development over the next few years. However, accelerating the decline in demand foroil and gas after 2030 in the Delayed Action Case means that no new long lead time oil
projects would need to be approved for development from the late 2020s onwards, and thisin turn means that there is no need to explore for new oil and gas fields from now on. The
projects that are developed over this period would have to prioritise low-emissions
technologies across the full supply chain. This means minimising methane leaks and flaring,
electrifying facilities using low-emissions electricity and integrating the use of CCUS where
feasible. After the late 2020s, oil and gas investment globally would shift entirely tomaintaining production at existing fields and minimising the emissions intensity ofoperations.

Chapter 4
Secure, equitable and co-operative transitions
Faster together
S U M M A R Y• The clean energy transition brings new energy security risks. Although capitalspending on critical minerals saw a 30% increase in 2022 and exploration spendingrose by 20%, announced critical mineral mining projects are not sufficient to meet theneeds of the Net Zero by 2050 Scenario (NZE Scenario) in 2030. Bridging this gap
requires a focus on investment, recycling, technology innovation and behaviouralchange.

• More traditional energy security risks do not disappear. Global oil and gas markets
reduce in volume terms in the NZE Scenario, but production becomes concentrated
in a small number of producers, with the share of the Middle East rising from 25%
today to 40% in 2050.

• The NZE Scenario sees a huge increase in clean energy investment and a rapid
decrease in fossil fuel investment. Ensuring a smooth transition requires the two to
be carefully synchronised. In the NZE Scenario, the key requirement is a massive andrapid increase in clean energy investment.

• Today more than 80% of clean energy investment is taking place in advanced
economies and China; more is needed in emerging and developing economies. The
NZE Scenario sees clean energy investment increasing nearly threefold from thecurrent level by 2030, but fivefold in emerging market and developing economies
other than China. Around USD 80-100 billion in annual concessional funding is neededby the early 2030s to lower the cost of finance and mobilise private capital in lower
income countries.

• Affordability of energy is a key concern. A people-centred transition requires
measures to ensure that the least well-off in all societies are able to benefit from thelower operating costs of clean and energy-efficient technologies. In overall terms,
clean energy investment in the NZE Scenario is outweighed by declines in spending
on fossil fuels, with worldwide net energy spending savings equalling USD 12 trillion
to 2050.

• The Global Stocktake needs to provide a clear signal about the ambition and urgency
with which countries are preparing their new Nationally Determined Contributions –the key vehicle for collective action under the Paris Agreement.

• International co-operation is central to develop agreed standards, to diversify clean

Chapter 4 | Secure, equitable and co-operative transitions

157

IEA. CC BY 4.0.

energy supply chains in a way that avoids undermining the benefits of global supply
chains, to ensure that rapid scale up can be achieved, and to share lessons learned
from clean energy demonstration projects to accelerate innovation.

4.1

Introduction

The IEA Net Zero by 2050: A Roadmap for the Global Energy Sector in 2021 concluded thatwithout fair and effective international co-operation the transition to net zero emissions
would be delayed by decades (IEA, 2021a). Today, the world faces sharper geopolitical
fractures, heightened concerns about energy security, more intense competition for clean
energy supply chains and technologies, and tighter financial and fiscal conditions particularly
in many emerging market and developing economies. These conditions may makeinternational co-operation more difficult, but it is just as important now as in 2021.
Achieving the outcomes set out in the NZE Scenario requires international co-operation inseveral areas. Energy security is an important concern for all countries and needs to be
actively managed both within and between governments, whether it is a question of a
traditional issue such as the security of oil and gas supplies or an emerging issue such as theadequacy and security of critical minerals supplies (section 4.2). Today, emerging market anddeveloping economies, other than China, are lagging significantly behind in the deploymentof clean energy technologies. Reversing this imbalance and ensuring that the benefits andcosts of the clean energy transition are distributed fairly must be a critical focus (section 4.3).
Among other issues, this entails addressing the investment gap in clean energy technologies
across emerging market and developing economies, including through the provision of moreconcessional finance to mobilise private capital (section 4.4). The Global Stocktake under theParis Agreement needs to provide a clear signal about the ambition and urgency with which
all countries are preparing their next round of Nationally Determined Contributions – the key
vehicle for collective action under the Paris Agreement. Innovation in novel clean energy
technologies needs to accelerate to support progress towards the goals of the Paris
Agreement, and international co-operation has a role to play here in respect of issues suchas cross-border infrastructure and the development of international standards (section 4.4).

4.2

Energy security

Managing traditional security risks related to fossil fuel supply will remain important during
the transition to clean energy systems. However, as the transition advances, new risks arise,
including some related to the supply of critical minerals needed for clean energy
technologies, and others that relate to the adequacy and reliability of electricity systems thatwill form the backbone of the new energy economy. This section looks at both new andtraditional risks and considers what approaches can reduce or mitigate them.

Bridging the gap between critical mineral supply and demand

The rapid deployment of clean energy technologies puts strains on supply chains, notably forcritical minerals. The development of clean energy technology supply chains has madeimpressive progress since 2015. However, the expected pace of growth in critical mineral
supplies does not yet match that of manufacturing capacity additions for clean energy
158

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

4.2.1

technologies, posing challenges for scaling up clean energy deployment at the required paceto support net zero emissions transitions.
Demand for critical minerals for clean energy applications quadruples between 2022 and2030 in the NZE Scenario. Electric vehicles (EVs) and battery storage are the main drivers ofdemand growth, but demand from low-emissions power generation and electricity networks
also increases. As demand for clean energy applications rises faster than it does for otheruses, the share of clean energy in total demand for key minerals increases considerably. For
example, the clean energy sector represents nearly 90% of total lithium demand by 2030 in
the NZE Scenario, up from 60% today, and clean energy technologies overtake stainless steel
as the largest consumer of nickel around 2030.
Figure 4.1 ⊳40

4Anticipated supply and projected demand for selected minerals
in the NZE Scenario, 2030

Copper (Mt)8

Nickel (Mt)800

Lithium (kt)

400

30

6

600

300

20

4

400

200

10

2

200

100

Cobalt (kt)2022 supply

Anticipated primary supply in 2030

Secondary supply in 2030

Total NZE demand in 2030
IEA. CC BY 4.0.

While investments in new projects are increasing, meeting requirements of the NZE Scenario
requires further efforts to boost investment, recycling and technology innovation

Despite increases in recent years, the anticipated supply from the current project pipeline
still falls short of the requirements in the NZE Scenario (Figure 4.1). Expanding investment in
new mining and refining facilities is crucial to avoid the risk of supply shortages slowing
energy transitions or raising their cost. Encouragingly, many countries have recently
introduced new policies to boost investment in new supplies. Our latest assessment indicatesthat capital spending for critical minerals development rose 20% in 2021 and by a further
30% in 2022 (IEA, 2023a). Exploration spending also rose by 20% in 2022, driven by record
growth in lithium exploration. But more needs to be done, and the lack of progress on
diversifying supply sources remains a concern. The share of the top-three producers of somecritical minerals in global supply remains very high and has not changed from 2019 levels,
Chapter 4 | Secure, equitable and co-operative transitions

159

IEA. CC BY 4.0.

Notes: Mt = million tonnes; NZE = Net Zero Scenario. Anticipated supply is expected future production basedon assessment of announced projects. Secondary supply refers to supply from recycled materials.

notably for nickel and cobalt. For refining and processing operations in particular, mostplanned projects are being developed in incumbent producers, with China holding half ofplanned lithium refining projects and Indonesia representing nearly 90% of planned nickel
smelting facilities.
An increase in recycling rates would help to reduce the pressure on primary supply and would
also bring energy security benefits, especially to regions with higher deployment of clean
energy technologies and limited resource endowments. For bulk materials such as steel andaluminium, recycling practices are relatively well established, but this is not yet the case formany energy transition minerals such as lithium and nickel. Waste regulations should be
updated to ensure that they cover emerging waste streams from new clean energy
technologies, backed by support for the construction of new recycling facilities. In the
NZE Scenario, secondary supply from recycling meets 10-20% of total demand for key energy
transition minerals in 2030, and there is scope for this share to increase significantly as theamount of equipment reaching its end of life expands in the longer term.
Technology advances also have a major role to alleviate potential supply strains. For
example, significant reductions in the use of silver and silicon in solar cells over the past
decade have contributed to a spectacular rise in deployment of solar photovoltaics (PV).
Embracing a higher share of high-voltage direct current transmission lines in electricity
networks has the potential to curtail their material demand by 3% in 2030 and 10% in 2050,
and a wider adoption of lithium-iron phosphate chemistries and sodium-ion batteries could
reduce mineral demand for EV batteries by 7% in 2030 and almost 20% in 2050.
Figure 4.2 ⊳Impacts of technology and behavioural changes on material
demand in the NZE Scenario, 2030 and 2050

5%Impacts in 2030
NickelAluminium
Graphite
Manganese
Lithium
CobaltCopper

0%
-5%
-10%
-15%
-20%
-25%

Impacts in 2050
Wider adoption of
DC systems in grid
networks

Smaller EV
battery size

Higher share of LFP
and sodium-ion inbatteries
IEA. CC BY 4.0.

Note: DC = direct current; LFP = Lithium-iron phosphate.

160

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Technology innovation and consumer behaviour provide scope to
alleviate potential supply strains by reducing demand

Changes in consumer behaviour also play a part. The NZE Scenario assumes, for example,
that targeted measures reduce the appetite for sport utility and other large vehicles, cuttingmineral demand for EV batteries by 18% in 2030 and around 20% in 2050 (Figure 4.2).
Addressing the potential gaps between supply and demand is a significant challenge, but
recent trends such as increased capital investment in new supplies, increased recycling
facilities and the emergence of new technology options provide grounds for cautious
optimism. To sustain this momentum, it is imperative to bolster international co-operationin order to stimulate investment, foster technology innovation and promote recycling
practices. This should be accompanied by increased international co-operation on the socialand environmental impacts of mining to improve performance, for example by harmonising
standards and strengthening data collection and reporting mechanisms.

4

While the demand for critical minerals increases significantly in the NZE Scenario, clean
energy transitions require significantly fewer extractive resources in aggregate than today’s
energy system. Decarbonisation means a major reduction in the overall materials intensityof the energy system, given that increased demand for critical minerals is accompanied by amassive decrease in extraction of fossil fuels. The net result is that for every unit of energy
delivered in 2050, the energy system consumes two-thirds less in materials (fossil fuels andcritical minerals combined) than it does today (Figure 4.3).

30

Material intensity of the global energy system in the
NZE Scenario, 2010-2050
Material intensity

-68%
20

10

Index (2022 = 100)

Kt/PJ

Figure 4.3 ⊳600

Intensity by category

400

200

2010 2022 2030 2040 2050
Fossil fuels

2010
2022
2030
Critial minerals

2040

2050

IEA. CC BY 4.0.

Overall intensity of materials to support the global energy system
drops by more than two-thirds by 2050

Chapter 4 | Secure, equitable and co-operative transitions

161

IEA. CC BY 4.0.

Notes: Kt/PJ = thousand tonnes per petajoule. Critical minerals do not include steel and aluminium. The
intensity for critical minerals does not include the amount of waste rock that occurs during mining activities.

4.2.2

Scaling up clean energy technologies and scaling back fossil fuels
need to be well synchronised

Efforts to ensure energy security have so far focussed on adding new infrastructure to ensure
uninterrupted access to energy supplies. However, net zero emissions transitions require a
winding down of high carbon energy systems alongside major investment in new clean
energy infrastructure. Ensuring a smooth transition requires these two movements to becarefully synchronised.

Trillion USD (2022, MER)

Figure 4.4 ⊳Global investment in clean energy and fossil fuels in the
NZE Scenario, 2023-2030

6

12Clean energy
Efficiency and end-use
Power and fuels

48

Fossil fuels
Oil
Natural gas
Coal

2

4

2023e

Ratio of clean energy
to fossil fuels(right axis)

2030
IEA. CC BY 4.0.

A massive scale up in clean energy investment is key to ensure smooth transitions,but the shift in energy investment needs to be carefully synchronised

Global investment in clean energy is set to outstrip investment in fossil energy by a factor of
1.8 to 1 in 2023. This ratio rises to 10 to 1 in 2030 in the NZE Scenario, when around
USD 2.5 trillion is invested in clean electricity and low-emissions fuels and around
USD 1.8 trillion in energy efficiency and end-uses, while investment in fossil fuel supply falls
to around USD 0.4 trillion (Figure 4.4). The sequencing of the shift in energy investment isimportant. Running ahead on scaling back fossil fuel investment before clean energy
investment ramps up would push up prices and risk price spikes, and this would notnecessarily advance secure transitions. The key requirement for the achievement of the
NZE Scenario is a massive and sustained increase in clean energy investment. The faster clean
energy investment and deployment takes place, the faster the transition away from fossil
fuels will be.
162

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Notes: MER = market exchange rate. Power and fuels also includes investment to reduce emissions from fossil
fuel supply.

Even with the ambitious and rapid clean energy transition in the NZE Scenario, someelements of fossil fuel infrastructure continue to contribute to the secure operation of theoverall energy system for many years to come. The role of gas-fired power plants in powersystem reliability, or of refineries in providing for the residual fuel needs of the internal
combustion engine (ICE) fleet, are cases in point. Unplanned or premature retirement of thisinfrastructure could have negative consequences for energy security. There is also scope toreuse or repurpose some existing infrastructure. For example, some parts of natural gas
networks could be used to transport low-emissions fuels such as biomethane and hydrogen,refineries could be converted to produce biofuels, and natural gas storage facilities could be
repurposed to store hydrogen.

4.2.3

4

Fossil fuel markets shrink, but vigilance is still needed

Achieving net zero emissions goals brings energy security benefits as reliance on fossil fuelsdecreases, but concerns about the security of oil and gas supplies do not disappear in the
NZE Scenario. Given the demand trajectory, the risks in this scenario do not relate to theadequacy of investment: global demand falls sufficiently fast that no new oil or gas fielddevelopments are needed, although continued investment in existing fields is still required.
But as energy transitions progress and demand falls, oil and gas supplies become increasingly
concentrated in a small number of low cost producers, and the Organization of thePetroleum Exporting Countries (OPEC) share of world oil production rises from 36% in 2022
to 52% in 2050 – a level higher than at any point in the history of oil markets since the firstoil shock. 1 Oil import dependency also remains high for many countries, notably in emerging
Asian economies. The Middle East plays an outsized role in serving these import needs, with
its share in total crude oil exports rising from 45% in 2022 to 65% in 2050 (Figure 4.5). Importdependency in Asia also rises for natural gas from 27% in 2022 to 45% in 2050. In the
NZE Scenario, importers therefore remain exposed to risks arising from geopolitical eventsand physical disruptions in the Middle East or accidents near trade chokepoints, even as thetotal volume of imports and the size of the oil and gas market falls.

1 Supply trajectories and sensitivities for the NZE Scenario are examined in more detail in a forthcoming WEO

special report on the Oil and Gas Industry in Net Zero Transitions, which will be released in November 2023.

Chapter 4 | Secure, equitable and co-operative transitions

163

IEA. CC BY 4.0.

The major hydrocarbon producers, notably in the Middle East, are also set to face economic
challenges as revenues from oil and gas sales decline with the shift towards clean energy. In
the NZE Scenario, governments in net exporting regions collect USD 380 billion from theproduction of oil and gas in 2030, around 50% below the average between 2017-2021, andthis falls further to less than USD 90 billion by 2050. While producer economies have taken
steps to diversify their economic structure, progress has been limited in most cases. Producer
economies have also made limited progress in diversifying their energy sector away fromfossil fuels and the share of low-emissions sources in their energy systems is among thelowest in the world.

Middle East share of global oil and gas production, and oil
and gas net imports in Asia in the NZE Scenario, 2022-2050

Production

400

100%

EJ

EJ

Figure 4.5 ⊳80

Net imports

100%

300

75%

60

75%

200

50%

40

50%

100

25%

20

25%

2022 2030 2040 2050
Middle East
Rest of world
Share of Middle East (right axis)

2022 2030 2040 2050
China
India
Japan and Korea
Southeast Asia
Dependency
Other Asia
(right axis)
IEA. CC BY 4.0.

Oil and gas supplies are increasingly concentrated in a small numberof low cost producers; Asia’s import dependency continues to rise
Note: EJ = exajoules.

Net zero transitions are more likely to proceed smoothly if countries work together
constructively to minimise these risks. That is easier said than done, of course, but there arevarious ways in which exporting and importing countries could build up shared interests toavoid pitfalls. For example, they could work together on technology demonstration and joint
R&D projects to harness the potential for low-emissions energy in producer economies;
co-operate to facilitate investment in low-emissions fuel trade; and strengthen bilateral andmultilateral engagement on a variety of energy-related issues. It is ultimately in everyone’s
interests that the transition to clean energy systems should be a smooth one.
164

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

The NZE Scenario charts an orderly process of change, but this is far from guaranteed inpractice. Some importing countries might look to conclude new supply arrangements in theinterest of energy security, even while seeking to reduce domestic fossil fuel use. Exporters
or potential exporters might also be keen to exploit untapped oil and gas resources and somelarge, low cost producers might choose to expand production to capture a bigger market
share, even if that pushes prices down; others might seek to restrict production to keep
prices high. All these options would come with risks. New projects would risk locking inemissions that push the world over the 1.5 °C threshold. They would also face major
economic and financial risks if the world is successful at scaling up clean energy in line with
the NZE Scenario. A higher degree of supply concentration among a small number ofcountries would mean increased import dependency risks for importing regions, andrestrictions on production by exporting countries to keep prices high could pose financial
strains on importers.

4.3

EquityAchieving net zero emissions by 2050 requires every country, every organisation and every
individual around the world to contribute to the clean energy transition. Yet today, the paceof deployment of clean technologies remains highly uneven, with advanced economies andChina pulling far ahead while other emerging market and developing economies lag behind.
Within societies, there is a risk that the less well-off will see fewer benefits from thetransition unless supportive policies are put in place for a people-centred transition. Thissection explores the drivers of disparities in clean energy deployment and ways forward forbringing clean energy to all (section 4.3.1), the affordability of energy in the NZE Scenario(section 4.3.2), and the best ways to manage the impact of a rapid transition on energy sector
employment (section 4.3.3).

4.3.1

4

Accelerating clean energy deployment in emerging market anddeveloping economies

Energy consumption per capita is highly unequal across countries, and clean energy
consumption even more so. Among the countries for which IEA has comprehensive energy
statistics, the current Gini coefficient 2 of energy inequality is 0.39 for all sources of energy
consumption and 0.46 for clean energy. Half of all the clean energy supplied is used by 15%of the global population, the majority of whom live in advanced economies (Figure 4.6).

Cumulative energy

Figure 4.6 ⊳Distribution of total final and clean energy consumption acrossthe global population, 2022

100%

Total final consumption
Clean energy

75%

Perfectequality

50%
25%

0%

25%

50%
75%
100%
Cumulative population
IEA. CC BY 4.0.

Energy use per capita is highly unequal across countries, and clean energy
consumption even more so, reflecting differences in income and wealth

2 The Gini coefficient is a measure of inequality typically used to measure income inequality, which has been

adopted in this section to evaluate inequality in energy consumption. 1 indicates perfect inequality (where
one group or one individual consumes or receives all the resources) while 0 indicates perfect equality.

Chapter 4 | Secure, equitable and co-operative transitions

165

IEA. CC BY 4.0.

Notes: The figure shows Lorenz curves; the closer the curve is to the 45-degree line, the more equal values areamong countries. Clean energy excludes the traditional use of biomass.

Figure 4.7 ⊳Clean energy technology deployment normalised for populationand households by region, 2022
Solar PV and wind capacity (GW per million people)

1.00

European Union
United States

0.75

China

0.50

Other AE
C & S America

0.25

Other developing Asia

MENA
Eurasia
Sub-SaharanAfricaPopulation

Electric car ownership (Units per thousand households)

40

European
Union

30
20

China

UnitedStatesOther AE

10

MENA
Eurasia
C & S America
Sub-Saharan
Other developing Asia
AfricaHouseholds
BAT appliances ownership (Units per thousand households)
United States
European
Union Other AE
450
Eurasia
MENA
China
300
C & S America
Other developing Sub-Saharan150
Asia
Africa600

Households
IEA. CC BY 4.0.

Clean energy technologies are deployed at a higher rate in advanced economies
and China than in other emerging market and developing economies

Differences in access to clean energy vary markedly across technologies. Today, advanced
economies and China combined have nearly 2.5-times more solar PV and wind capacity inoperation per person than the global average (Figure 4.7). Wind and solar deployment per
166

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Note: BAT = best available technologies; AE = Advanced economies; C & S America = Central and SouthAmerica; MENA = Middle East and North Africa.

capita are particularly low in Africa. In 2022, the Netherlands had more solar PV capacity
installed than the whole of Africa, for example. More capital-intensive and less maturetechnologies such as battery storage are the most unevenly deployed across regions. Less
capital-intensive technologies such as best-in-class efficient appliances and light-emitting
diode (LED) lighting systems are more evenly deployed. The disparities are not only a legacyof the earlier start in the deployment of clean energy technologies by advanced economies:
similarly strong disparities are seen in recent capacity additions and new sales.
Concerted action at international and national levels is needed to address these disparities.
The main barriers include:

4

Access to finance: Capital costs for renewables-based projects in emerging market anddeveloping economies remain at least double those in advanced economies (Figure 4.8).
This reflects the relative lack of experience with clean energy technology in thoseeconomies and their constrained policy and regulatory capacity in comparison withadvanced economies. It also reflects wider real or perceived macroeconomic risks. The
higher financing costs that these economies face perpetuates a lack of experience withclean energy technologies, which creates a vicious circle of under deployment. Financial
support, for example through Just Energy Transition Partnerships, will be necessary, but
is not sufficient to help overcome these barriers. (Concessional finance, de-risking
instruments and other solutions are discussed in section 4.4.1.)
Figure 4.8 ⊳Weighted average cost of capital for renewables andrenewables capacity per capita versus GDP per capita, 2022

9%

900

6%

600

3%

300

<10

10-19

20-29

30-39

40-49

MW per million people>50

GDP per capita (Thousand USD, [2015 MER])WACC for renewables

Normalised renewables capacity (right axis)
IEA. CC BY 4.0.

The cost of financing for renewables is more than two-times higher in the lowest income
countries than in high income countries, correlating with lower deployment per capita

Source: IEA analysis based on IRENA (2023).

Chapter 4 | Secure, equitable and co-operative transitions

167

IEA. CC BY 4.0.

Note: WACC = weighted average cost of capital; MER = market exchange rates.



Policy environment: Supportive policies are vital to expand clean energy. Economic andregulatory instruments such as standards and codes have been shown to boost the
adoption and utilisation of clean energy solutions (Nepal et al., 2018; Pfeiffer and
Mulder, 2013), and well-designed government policies play a central role in altering
incentive structures for private actors and encouraging the uptake of new technologies.
Many emerging market and developing economies have been less able to move forwardin these areas than advanced economies, often because of competing political priorities
including economic development and poverty alleviation, and this gap is visible in the
different ambition levels set out in their Nationally Determined Contributions(section 4.4.2).

Innovation ecosystems: So far, few clean energy innovations have originated indeveloping economies. Emerging market and developing economies other than China
accounted for only 5% of global public energy R&D funding, 3% of corporate energy R&D
funding and 5% of energy venture capital funding in 2022 (IEA, 2023b), while 90% of
patents for low-emissions energy between 2000 and 2020 were from advanced
economies and another 8% from China (IEA, 2021b). Although energy technologies
diffuse across country borders over time, there can be delays of over a decade between
early and late adopters, and much longer in some cases (Figure 4.9). Lowering barriers
to trade and foreign direct investment can help to foster technology diffusion, as canincreased engagement between countries in early-stage technologies (section 4.4.3).
Figure 4.9 ⊳Share of countries adopting selected technologies,
1970-2022
Emerging market and developing economies
100%

Advanced economies

100%
75%

75%

50%

50%

25%

25%

1970

1980

1990

2000

Steel: blast oxygen furnace
Wind

2010

2020

1970 1980 1990 2000 2010 2020

Steel: electric arc furnace
Solar PV

Nuclear
IEA. CC BY 4.0.

First adoption of energy technologies in emerging market and developing economies
in some cases has lagged over a decade behind advanced economies

168

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Note: Power technologies are counted as adopted when at least 10 MW of capacity have been installed.

Market size and conditions: In countries where market size is limited, economies ofscale are difficult to achieve and technology costs may remain high. In countries where
societal awareness and demand from consumers for clean energy is less pronounced,
companies have fewer incentives to invest in or switch to cleaner technologies (Suzuki,
2015; Zeng et al., 2022).

4.3.2

Enhancing clean energy affordability

Domestic trends mirror disparities at the international level. Even in countries that haveachieved relatively high rates of clean technology deployment, there remain large groups ofpeople who cannot afford the upfront premium of some clean energy technologies. Althoughtechnology purchase costs decline over time as their scale of deployment increases – as has
been the case in China, where EVs are now often cheaper than ICE cars – there often remains
a significant “green premium” even for relatively mature technologies, and that can beprohibitive for lower income or even median income households (Figure 4.10). As an
example, for Chinese or US households in the 25th percentile, a deep building retrofit – anintegrated set of energy conservation measures to significantly improve overall building
performance – of an average size home can cost four to nine months of income, comparedwith one to two months for households in the 75th percentile. In advanced economies, thecost premium of buying a heat pump as opposed to a fossil fuel boiler is up to four months
of income for households in the 25th percentile.

4

Figure 4.10 ⊳ Purchase cost premium for clean energy technologies inmonths of household income in selected countries, 2022

Months of income

25th percentile
9

9

6

6

3

3

United France United Japan China
StatesKingdom
Electric car vs ICE car

75th percentile

United France United Japan
StatesKingdom

Building retrofit vs none

China

Heat pump vs fossil fuel boiler
IEA. CC BY 4.0.

While often affordable for the rich, the cost premium of low-emissions efficient technologies
can be equivalent to several months of income for lower income households

Sources: IEA analysis based on World Inequality, (2022) for income; JATO, (2021) for vehicle costs.

Chapter 4 | Secure, equitable and co-operative transitions

169

IEA. CC BY 4.0.

Notes: Subsidies are not accounted for here. Costs are shown for average size cars, residential dwellings andheat pumps. In China, electric cars on average are cost-competitive with ICE cars.

This green premium can prevent low income households from benefiting from the lower
operating costs that come with clean and energy-efficient technology options. For example,
heat pumps are three- to five-times more efficient than fossil fuel boilers, while induction
stoves are two- to three-times more efficient than gas stoves, and a household retrofit which
is deep enough to reduce energy consumption for space heating and cooling by 50% canlower annual energy bills by more than 25% for an average family in the United States. The
poorest households would benefit most from these savings on operating costs because they
spend more of their income on energy than richer households, even though their emissions
footprints are much smaller: the poorest 10% of the global population are responsible for amere 0.2% of energy sector CO2 emissions, while the richest 10% are responsible for nearly
half (IEA, 2022a).
Poorer households need to be given careful consideration as clean technologies are rolled
out if countries are to achieve just transitions, and if national decarbonisation targets are not
to be at risk from lack of broad societal support. To help the poorest households afford
efficient low-emissions technologies, governments can build measures to address
inequalities into the design of climate policies. For example, grants and fiscal support forclean technologies can be means-tested by income (Table 4.1).
Means-tested clean technology household grant programmes

Country

Programme

Technology target

Means testing criteria

CanadaOil to Heat Pumps
Affordability Program

Residential heat pumps

Post-tax household income must be ator below national median.

Ireland

Fully funded energy
upgradesResidential efficiency
improvements including
improved insulation

Households receiving welfare payments
are eligible.

FranceVehicle conversion
premium

Lower carbon, more
efficient vehicles

For households with income below
EUR 22 983.

MaPrimeRénov

Residential efficiency
improvements

The amount of the grant is scaled basedon income.

UnitedKingdomHome Upgrade Grant

Energy efficiency upgrades Funding is only available for low income
for off-gas-grid homes
households.

UnitedStatesInflation Reduction Act
Clean Vehicle Credit

New electric vehicles

Household income must be below
USD 300 000 for couples or
USD 150 000 for individuals.

Weatherization
Assistance Program

Residential energy
efficiency improvements

Households must be at or below 200%of the US poverty income guideline.

The costs of the clean energy transition are understandably a concern for all countries. In
advanced economies, technology upgrades and energy efficiency retrofits translate into
substantial savings on energy bills. In emerging market and developing economies,
households also benefit from the more efficient use of energy, though modern energy
consumption increases as rising incomes allow for larger residences and more appliances.
New appliances need to meet ambitious energy efficiency standards in emerging market and170

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Table 4.1 ⊳developing economies, where the coverage and stringency of these policies is lower today
than in advanced economies. In the NZE Scenario, over a billion people gain access to modern
energy by 2030, particularly in sub-Saharan Africa. While this results in new expenditure onelectricity and other modern fuels, it saves time previously spent on fuel wood collection inrural areas and money previously spent on expensive charcoal in cities.
Carbon pricing policies and the phase-out of fossil fuel subsidies raise fuel costs. These policychanges need to be carefully designed and implemented to limit impacts on household
budgets and to sustain support for the clean energy transition. Fossil fuel subsidies reachedrecord levels in 2022 but are largely removed by 2030 in the NZE Scenario (Figure 4.11). Thishas the benefit of lowering the burden on government budgets compared with the Stated
Policies Scenario (STEPS), and does not prevent the provision of targeted support for theenergy costs of low income households through direct payment schemes or other means.
Targeted measures cost much less than across-the-board subsidies, not least because
wealthier households consume more energy than poorer ones and therefore benefit
disproportionately from subsidy schemes. New and expanded carbon tax and emissions
trading systems provide important additional sources of revenue as the clean energy
transition progresses: these could be used in part to help low income households to affordclean and more energy-efficient technology options and reduce their energy bills.

4

Figure 4.11 ⊳ Annual cost of residential energy per household in emerging
USD (2022, MER)

market and developing economies in the STEPS and NZE
Scenario, 2022 and 2030

800

Subsidies
Carbon pricing
Energy spending

600

400

200

2022

2030 STEPS

2030 NZE
IEA. CC BY 4.0.

Note: Energy spending includes other taxes and levies on fuels in addition to carbon pricing and excludes
transport fuel spending.

Chapter 4 | Secure, equitable and co-operative transitions

171

IEA. CC BY 4.0.

Phasing out energy subsidies and carbon pricing policies in emerging economies need tobe carefully designed and implemented to avoid negative impacts on consumers

4.3.3

Managing the employment transition

The changes between now and 2030 in the NZE Scenario imply a rapid transformation inenergy employment, with the demand for workers in clean sectors rising much faster than
the fall in fossil fuel-related jobs. Today, around 65 million people work in energy or key
energy-related sectors such as energy efficiency and vehicle manufacturing, and half of thesejobs are already focussed on clean energy. 3 In the NZE Scenario, 30 million new clean energy
jobs are added by 2030 while close to 13 million jobs in fossil fuel-related industries are lost,
meaning that around two clean energy jobs are created for every fossil fuel-related job lost
(Figure 4.12).
Figure 4.12 ⊳ Energy employment changes by sector in the NZE Scenario,

Million workers

2022-2030

100

Critical minerals
Low-emissions fuels

80

Grids and storage
Low-emissions power

60

End-use efficiency

40

ICE vehicles

EVs and batteries
Oil and gas supply
Coal supply

20

Unabated fossil fuel power
2022

Gains

Losses

2030
IEA. CC BY 4.0.

Approximately two clean energy jobs are createdfor every fossil fuel-related job lost between today and 2030
Note: ICE = internal combustion engine; EVs = electric vehicles.

3 See IEA World Energy Employment Report 2023, (forthcoming) for more detailed information on energy
employment by sector and region.

172

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Employment in low-emissions electricity sees substantial growth in the NZE Scenario, withsolar PV and wind power adding around 3 million jobs each and employing a combined
11.5 million workers by 2030. The better-established end-use efficiency and electricity gridlabour forces also continue to expand throughout the decade, employing around 14 millionand 11.5 million people respectively in 2030, whereas emerging technologies such as
low‑emissions hydrogen production or concentrating solar power see job opportunities
increase sharply by 2030.

The sectors likely to see larger job losses, including fossil fuel supply and ICE vehicle
manufacturing, need to carefully plan for the changes ahead. This magnitude of job losses is
not unprecedented – in China, the number of coal mining workers has nearly halved over thelast two decades due to labour productivity improvements (IEA, 2022b). In some cases,
workers in activities that stand to lose jobs already possess skills and know-how that overlap
with growing energy sectors. Coal miners have many of the skills needed for the extraction
and processing of critical minerals, for example, while people working in conventional vehicle
manufacturing can apply their experience to EV manufacturing and battery assembly.
Workers leaving the oil and gas workforce are already highly sought-after by the chemicalindustry and others. In many cases, however, the jobs created by the energy transition will
not be in the same place, require the same skills, or pay the same wages as the jobs lost, suchthat policies could play a role to support the workers and communities whose livelihoods
may be affected.

4.4

4International co-operation

The IEA’s 2021 Net Zero by 2050 report concluded that a lack of fair and effective
international co-operation would push back the date by which global net zero emissions areachieved by decades (IEA, 2021a). The report included the Low International Co-operation
Case which explored the implications of failing to co-operate on finance, trade and supply
chains, technology innovation and CO2 removal. This section builds on this case and explores
several areas in which international co-operation needs to be strengthened.

4.4.1

Addressing financing barriers in emerging economies

Investment needs for net zero emissions

While the recent global shift in investment towards clean energy shows that the transition iswell and truly underway, a much faster shift is needed to get on track for net zero emissions
by 2050, with an average of USD 10 needing to be invested in clean energy for each
USD 1 invested in fossil fuels by 2030. In total, annual clean energy investment reaches
USD 4.5 trillion by the early 2030s and USD 4.7 trillion by 2050 in the NZE Scenario, comparedwith USD 1.6 trillion in 2022 (Figure 4.13). Most of the increase in clean investment is in theemerging market and developing economies (other than China), where it rises fivefold inthe second half of the current decade compared with 2022, and more than sevenfold in thesecond half of the 2040s.
Chapter 4 | Secure, equitable and co-operative transitions

173

IEA. CC BY 4.0.

Recent trends in clean energy spending provide some encouraging signs at the global level.
Investment in clean energy outpaces investment in fossil fuels: for each USD 1 invested infossil fuels in 2023, we estimate that USD 1.8 will be invested in clean energy. Clean energy
investment today is dominated by the advanced economies and China. Some large
economies such as India and Brazil have recently seen strong growth in clean energy
investment, but it continues to lag investment in fossil fuels in other emerging market anddeveloping economies, with an estimated USD 250 billion set to be invested in clean energy
in 2023 compared to nearly USD 450 billion invested in fossil fuels.

Figure 4.13 ⊳ Clean energy investment needs by region/country in the
Trillion USD (2022, MER)NZE Scenario, 2022-2050

2.0

Other EMDE

China

Advanced economies
Low-emissions fuels
Grid and storage

1.5

Low-emissions
power
Energy efficiency
and end-use

1.02046-502026-302022

2046-502026-302022

2046-502026-30

2022

0.5

IEA. CC BY 4.0.

The bulk of increased investment in clean energy is needed in emerging economies, otherthan China; it rises more than sevenfold in the second half of the 2040s relative to 2022

Global investment spending on clean energy peaks in the NZE Scenario at USD 4.8 trillion peryear between 2036 and 2040. This very high level of investment leads to significant savingsin fuel purchases, which fall from an average of about USD 8.2 trillion per year in 2018-2022
to USD 7.5 trillion in 2050 (a third lower than in the STEPS) (Figure 4.14). Total fuel andinvestment spending as a share of GDP peaks during the 2026-2030 period at 11.2% before
falling to 6.4% in 2050. Cumulative savings on fuel spending exceed additional capital
investment by 40% from 2031 through 2050, with net undiscounted savings equalling
USD 12 trillion. The benefits of clean energy transitions would be even higher if the benefits
associated with improved air quality and lower frequency of extreme climate events werealso taken into consideration.
174

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

In China and advanced economies, investment in low-emissions power has been risingstrongly because of supportive government policies and rapid cost declines in solar PV andwind which have made those technologies attractive to investors. Investment in electricity
networks and storage has not risen as quickly, and now needs to accelerate in order to meetrising demand, modernise systems and ensure reliable service. Raising the level ofinvestment is a tougher undertaking in many developing economies, where state-owned
utilities are struggling to raise affordable capital as a result of rising interest rates, high levelsof existing debt and cash flow pressures related to electricity subsidies. Risks associated withtimely grid connections and curtailment are often cited by investors as barriers to developing
new renewables projects in these countries. The introduction of cost-reflective tariffs would
be particularly helpful in this context.

Figure 4.14 ⊳ Global energy investment and spending on fuels in the STEPS and
Trillion USD (2022, MER)

the NZE Scenario, 2018-2050

15

2018-222026-30

2046-50

15%

10

10%

5

5%

STEPS NZE

Fuel spending
Other energy
investment spending
Clean energy investment
spending
Total investment as ashare of GDP (right axis)

4

STEPS NZE
IEA. CC BY 4.0.

Higher capital investment in clean energy in the NZE Scenario more than pays off inreduced fuel spending with net undiscounted savings equalling USD 12 trillion

International co-operation to scale finance for clean energy
Many emerging market and developing economies struggle to finance new projects due torising debt levels and tightening fiscal conditions. Some have seen access to externalfinancing closed off. Large emerging economies such as Brazil, India, Indonesia, Mexico andSouth Africa can raise capital, but it costs two- to three-times more than in advanced
economies (Figure 4.15).

Closing the gap will also require the appropriate package of support. There are two important
points here. First, there is no single instrument on which to rely; a mix of concessional
finance (below market rate loans), grants for project structuring and project preparation,
Chapter 4 | Secure, equitable and co-operative transitions

175

IEA. CC BY 4.0.

Closing the financing gap will require increased international co-operation between
countries and more active engagement with financial stakeholders to better understand thebarriers faced by emerging market and developing economies and the impact on the cost ofcapital of the risks that investors are most concerned by. This would help to better target
policy interventions and inform the design and prioritisation of blended finance – thestrategic use of development finance and philanthropic funds to mobilise private capital
flows to emerging market and developing economies. The knowledge and experience gained
from successful projects could also be shared more widely with the aim of helping othercountries, while more standardisation in project structuring and preparation would facilitate
the development of new projects and ease due diligence processes. Stronger efforts will also
be needed to improve the availability and quality of data necessary for financial investors tobetter assess and hence manage risks. The provision of capacity building support by theinternational community would help.

guarantees and other de-risking instruments (including to lower the cost of currency
hedging) is needed. 4 Second, reaching scale will require a shift from direct financing of
projects towards more project de-risking with the aim of leveraging much higher multiples
of private finance and maximising the use of limited public funds. International co-operationand engagement with investors will be vital in this context.
Figure 4.15 ⊳ Cost of capital for various solar PV projects in selected countries,
WACC

2019 and 2021

20%
16%
12%
8%

Range for theEuropean Union
United States
and China

4%

2018
Brazil

2019
2019
India

2020

Indonesia

Mexico20212021

2022

South Africa

MedianIEA. CC BY 4.0.

Cost of capital for large emerging economies is two- to three-times higher than inadvanced economies, undermining the financial viability of new projects
Notes: WACC = weighted average cost of capital. Each dot corresponds to individual utility-scale projects.

Of course, there is also the question of how much support is needed. Analysis undertaken by
the IEA with the International Finance Corporation estimates that the NZE Scenario would
require USD 80 to 100 billion in annual concessional funding by the early 2030s to improverisk adjusted returns to mobilise private capital at scale for clean energy investment (IEA and
IFC, 2023). This is less than a fifth of what was spent in 2022 by governments in advanced
economies on measures to lower energy bills during the energy crisis (IEA, 2023c). Africa
would require the largest share of support, accounting for 45% of estimated concessional
funding needs, followed by India and Latin America and the Caribbean, which would eachaccount for about 15% (Figure 4.16). Half of all concessional funds would support investment
in low-emissions power, and a third would support investment in end-use energy efficiency
and electrification. Low-emissions hydrogen, bioenergy and carbon capture and storage(CCUS) together account for 14%, or almost twice their share in overall investment, reflecting

cases. Clean energy technologies such as solar PV and onshore wind already can be financed commercially inseveral emerging economies.

176

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

4 Not all investment will require concessional finance, nor will blended finance structures be appropriate in alldifficulties in obtaining commercial financing for such large-scale immature technologies.
Electricity networks and storage account for just 4%, which is less than their share in overall
investment, reflecting the fact that some state-owned utilities with high debt levels and/or
low credit ratings face significant difficulties to access private capital.
Figure 4.16 ⊳ Concessional funding needs for clean energy in selected

Billion USD (2022, MER)

emerging market and developing economies and by sector
in the NZE Scenario

120

By sector, 2026-30

By region
Europe and Eurasia
Latin America andthe Caribbean
Other Asia
Southeast Asia
India
AfricaMiddle East80402026-30

2031-35

4

Low-emissions
fuels 14%

Efficiency
and end-use
32%

Low-emissions
power 50%

Grids and storage 4%
IEA. CC BY 4.0.

Africa requires the largest share of concessional funding;
low-emissions power accounts for half of all concessional funding needs
Note: Low-emissions fuels include bioenergy, low-emissions hydrogen and CCUS.

At the Conference of the Parties (COP) 15 in 2009, developed countries committed to acollective goal of mobilising USD 100 billion per year by 2020 (extended to 2025 at COP 21)
to support climate action in developing countries. In 2020, public climate finance for energy,transport and industry reached USD 31 billion and mobilised USD 9 billion in private capital(OECD, 2022). In 2020, each USD 1 of public climate finance in the sector leveraged just
USD 0.3 of private finance. Average leverage ratios for private capital mobilisation need toreach USD 6-7 by the early 2030s in the NZE Scenario.

A new collective quantified goal on climate finance (NCQG), is intended to be agreed by 2024
and to supersede the USD 100 billion target agreed at COP 15. Whatever is agreed will have
Chapter 4 | Secure, equitable and co-operative transitions

177

IEA. CC BY 4.0.

Therefore, much more is needed to deliver on the commitment made at COP 15 and toprovide what is needed in the NZE Scenario to put the world on course to global net zero
emissions by 2050. Moreover, considerable additional funding will be needed so that stateowned enterprises that cannot at present access commercial capital are able to fund projects
such as electricity network upgrades or energy efficiency improvements in public buildings.

major implications for the journey towards global net zero emissions by 2050. Negotiations
on the NCQG should take account of the need to rapidly scale up the amount of public climate
finance provided to emerging market and developing economies and the need to increase
the amount of private capital mobilised. Carbon credit financing could complement othersources (Box 4.1). It will also be important for providers to carefully consider how best to
allocate and target their contributions.
Box 4.1 ⊳How can carbon markets contribute to scaling up nascent clean
energy technologies?

Nascent technologies and fuels such as direct air capture and storage (DACS), sustainableaviation fuels and low-emissions hydrogen play an important role in the NZE Scenario.
However, securing financing for demonstration and first-of-a-kind projects is hindered bytheir high initial costs. Initial projects may not offer the prospect of a short-termcommercial return, but they are needed to bring down costs through learning andeconomies of scale, and thus to accelerate deployment.
Policy support for these technologies in the form of tax credits, advanced market
commitments, concessional loans and loan guarantees is gaining momentum. That
support is essential, but it may be insufficient to guarantee that planned projects are
implemented and new projects come forward. Private capital is also needed. Carbon
credit markets offer a potential means of providing it.
An example is DACS for which the current price of removing one tonne of CO2 is in therange USD 600-2 500, but it is clearly an important technology for the future and its costs
will come down as lessons are learned from initial projects. Today voluntary carbon
markets are underpinning most DACS projects, with growing purchases of DACS credits
by firms and advance purchase commitments by demand aggregators such as Frontier. 5
Sustainable aviation fuels (SAF) offer a second example. Producers of SAF today rely
mainly on off-take agreements for their revenues, but demand has been low because SAF
prices are three- to four-times higher than those of conventional jet fuel. SAF credits
could help to bridge the price gap premium, and a start on this is being made. For
instance, a pilot project was launched in July 2022 by GenZero, an investment company,
Singapore Airlines and the Civil Aviation Authority of Singapore to advance the use of
SAF. A total of 1 000 SAF credits were made available for sale, generated from the
1 000 tonnes of SAF to be used at Singapore Changi Airport. Each credit purchased will
reduce CO2 emissions by 2.5 tonnes. In the European Union, there are plans to makeavailable 20 million allowances under the EU Emission Trading System, with a market

removal technologies set up in early 2023 by a consortium comprising Stripe, Alphabet, Shopify, Meta and
McKinsey Sustainability. In June 2023, it announced its first purchases from six projects on behalf of Stripe
worth up to USD 7.8 million (Frontier, 2022).

178

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

5 Frontier, a demand aggregator, is an advance market commitment to accelerate the development of carbon

value around EUR 2 billion, to cover some or all of the price gap between fossil kerosene
and SAF for the period 2024-2030. A clear framework to account for the overlap of direct
GHG emissions from fuel combustion of airlines (or Scope 1 emissions) with indirect GHG
emissions from private and business travel (or Scope 3 emissions) would be importantfor ensuring that SAF credits are used credibly to effectively reduce emissions from air
travel.
Carbon credits could complement other sources of financing of low-emissions hydrogenprojects. The complexity of the supply chains involved means that it has not yet provenpossible to establish such credits, but the Hydrogen for Net Zero (H2NZ) Initiative iscurrently seeking to develop new crediting methodologies for the voluntary carbon
market aimed at unlocking carbon finance for hydrogen projects (South Pole, 2023).

4

The credibility of carbon credits has suffered in recent years as a result of market design
imperfections and some cases of abuse. It is essential to ensure that carbon credits are
generated from real, verified, additional and permanent emissions reductions or
removals. Applying industry guidelines such as those of the Integrity Council for the
Voluntary Carbon Markets Core Carbon Principles 6 and following guidance under
Article 6 of the Paris Agreement should help in this respect. There also needs to be moretransparency on the actions taken by corporations in pursuit of their net zero emissions
strategies and other pledges, including their use of carbon credits, and more guidance on
how to formulate a CO2 removal strategy. The Voluntary Carbon Markets Integrity
Initiative 7 could be helpful here: among other things, its Claims Code of Practice should
help reduce instances of greenwashing.

4.4.2

Enhancing ambitions through the United Nations Framework
Convention on Climate Change and Global Stocktake

Under the 2015 Paris Agreement, countries agreed to co-operate to collectively limit the
global increase in temperature to well below 2 °C and to pursue efforts to limit it to 1.5 °C
above pre-industrial levels. Progressive strengthening of national climate goals and collective
action is central to the Paris Agreement. Its ratchet mechanism requires Parties tocommunicate new or updated Nationally Determined Contributions (NDCs) of increasing
ambition every five years from 2020, based on the capability and capacity of each country,
and informed by the Global Stocktake of progress between cycles (Figure 4.17).

6 https://icvcm.org/the-core-carbon-principles
7 https://vcmintegrity.org/

Chapter 4 | Secure, equitable and co-operative transitions

179

IEA. CC BY 4.0.

The five-year cycle between each round of NDC submissions is intended to strike a balance
between the need to give time to countries to formulate, implement and learn from their
NDCs, and the need for the level of ambition to be increased in the light of the urgent
requirement to tackle climate change. This urgency is reflected in the decisions taken at

COP 26 in 2021 and COP 27 in 2022, which invited countries to strengthen their current
NDCs, rather than wait for the first Global Stocktake in 2023 before doing so, as requested
in the Paris Agreement. The response to these calls to strengthen ambitions of existing NDCs
was underwhelming (see Chapter 1). It is therefore critical that the next round of NDCs
should represent a true step-change in ambition and that a key outcome of the Global
Stocktake should be a requirement for all countries to submit more ambitious NDCs for the
next cycle.
Figure 4.17 ⊳ Timeline of Nationally Determined Contribution submissions,
Number of submissions

2015-2026

80

COP21

Paris Agreement entry
into force

COP26

COP28

COP30

First
GlobalStocktake

60

40
Second NDCs

INDCs
20
First NDCs
2015

2016

2017

2018

Revised NDCs
2019

2020

2021

2022

2023

2024

2025

2026

IEA. CC BY 4.0.

168 NDCs, representing 195 countries, had been submitted
to the UNFCCC by September 2023, of which nearly 90% had been revised
Note: INDCs = Intended Nationally Determined Contributions; NDCs = Nationally Determined Contributions;
COP = Conference of the Parties.

The Paris Agreement requests developed countries to adopt absolute emissions reduction
targets, while developing countries are only encouraged to do so in recognition of the factthat for many of them, the NDC process was the first time they may have set mitigation
targets. To date, most NDCs from developing countries use either baseline scenario targets,
which mitigate emissions against a forward-looking counterfactual business-as-usual
baseline, or emissions intensity targets, which are relative to an economic or operationalvariable such as GDP. As of September 2023, countries with low to medium income per capita
have mostly set baseline scenario targets, whereas countries with higher income per capita
180

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Transparency is also an important component of the co-operative framework of the Paris
Agreement. Before COP21, fewer than 80% of draft NDCs contained a quantified mitigation
target. As of September 2023, this share had increased to 91% in revised NDCs, significantly
facilitating the assessment of collective progress.

have mostly adopted absolute emissions reductions targets (Figure 4.18). However, anumber of higher income countries have either not elaborated NDCs at all or have adopted
intensity or baseline NDCs that are not commensurate with their level of development. In
the next round of NDCs, it is hard to see a good reason why any high-emitting, higher income
country should fail to adopt an absolute reduction target.
Figure 4.18 ⊳ Mitigation target types of current NDCs by country development
100%

100

75%

75

50%

50

25%

25

1

2

3

4

5

6

7

8

9

Thousands USD (2022, PPP)

level

Not defined

4

Intensity
Baseline scenario
Absolute emissions
reductions
Average GDP per
capita (right axis)

10
IEA. CC BY 4.0.

Most high income countries have set absolute emissions reductions targets;for the second-round of NDCs, all high-emitting, high income countries should do so

4.4.3

Accelerating clean energy technology deployment

International co-operation will need to play a major role in accelerating the development
and diffusion of clean energy technologies around the world. We highlight the importanceof co-operation in three key areas: set standards for near zero and low-emissions materials
and fuels; diversify clean energy technology supply chains; and step up clean energy
demonstration projects.

Definitions and standards embodying measurement protocols and environmental
performance thresholds can help to establish a common view of the way forward for various
technologies and sectors. For heavy industry and long-distance transport, they are neededin particular to underpin policies designed to tackle hard-to-abate emissions. A package ofpolicy measures may include “demand pull” measures, for example to establish
differentiated markets for products and fuels produced with substantially fewer emissions

Chapter 4 | Secure, equitable and co-operative transitions

181

IEA. CC BY 4.0.

Definitions and standards for clean products and fuels

than those produced with incumbent technologies, to develop clean public procurement 8
protocols, and to define clean technology mandates. All of these depend on the existence ofagreed standards. It may also include “supply push” measures, for example to make itpossible to evaluate through the use of agreed standards whether a given technology ormeasure to reduce emissions deserves financial support, and if so to what extent.
Once emissions have been measured, thresholds can be used to differentiate production,
products and fuels according to their environmental footprint. Such thresholds should bedesigned to be stable, absolute and sufficiently ambitious to be compatible with a trajectory
for the global energy system that reaches net zero emissions by mid-century. They also needto take account of the specific characteristics of each sector, material and fuel, such as thelimited availability of certain inputs like scrap metal for recycling. Interim measures that
substantially lower emissions intensity but fall short of desired higher performancethresholds should be recognised, but only in the context of longer term plans to reach thosehigher thresholds. The IEA has recently put forward, as inputs to ministerial discussions
among the Group of 7 (G7) members, common definitions for near zero emissions steel andcement production as well as frameworks for measuring and collecting data on lowemissions hydrogen (IEA, 2022c; IEA, 2023d).
Several regulatory frameworks and certification systems defining the environmental
performance of fuels and materials are currently being developed in parallel (Figure 4.19);
between which there are inconsistencies of approach. There is a significant risk that a lack of
co-ordination may lead to a proliferation of varying standards, resulting in market
fragmentation, excessive administrative burden for companies, and a confusing landscapefor customers and suppliers. The IEA has proposed net zero principles for emissions
measurement methodologies for materials production that aim to guide revisions to existing
methodologies and promote convergence and interoperability in the medium term (IEA,
2023e). These principles stipulate that an emissions measurement methodology should
allow for comparison between production from all facilities. Emissions boundaries and scopeshould cover all major contributions to production and product emissions. Accounting rules
for emissions credits and co-products should be compatible with a net zero emissions energy
system. In addition, methodologies should incentivise, wherever possible, the use of siteand product-specific auditable, measured data, as opposed to generic emissions estimatesor factors.

8 Clean procurement entails the procurement of goods and commodities that are produced and delivered inways that are compatible with clean energy transitions. The term green procurement is often used.

182

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Stronger international co-operation is vital to limit the proliferation of multiple, competing
standards that risk slowing the clean energy transition. By aligning standards, countries canhelp create larger, shared markets for lower emissions fuels and materials, thus accelerating
cost reductions. The newly established IEA Working Party on Industrial Decarbonisation, theInternational Partnership for Hydrogen and Fuel Cells in the Economy, and the Clean Energy
Ministerial Hydrogen Initiative are relevant fora in which governments can collaborate on
this topic.

Figure 4.19 ⊳ Emissions intensity thresholds for near zero and low-emissions
kg CO₂-eq/t of crude steel

steel production as a function of the proportion of scrap used

400

First Movers Coalition
ResponsibleSteel

300

SSAB
GSCC 2050

200

4

100

0%

20%

40%

60%
80%
100%
Scrap share of metallics input
IEA. CC BY 4.0.

While there are significant differences between the emissions intensity thresholds
proposed by various institutions, their long-term ambitions are very similar
Notes: kg CO2 -eq/t = kilogramme of carbon dioxide equivalent per tonne. GSCC 2050 refers to the 2050 valueof the Steel Climate Standard produced by the Global Steel Climate Council, an association of steel producers.
The other thresholds are static over time and thus are not associated to a particular year. They correspond to
the SSAB fossil-free standard developed by the steel producer SSAB, the ResponsibleSteel International
Standard developed by the non-profit multistakeholder certification initiative ResponsibleSteel (the threshold
is equivalent to and constitutes a public endorsement of the threshold put forward by the IEA to the G7
Ministers in 2022), and the procurement requirements outlined by the First Movers Coalition, an initiative that
promotes private procurement in support of clean energy technologies.
Sources: ResponsibleSteel (2022); First Movers Coalition (2022); SSAB (2023); GSCC (2023).



Avoid the creation of new emissions measurement methodologies for materials andfuels emissions intensity and focus efforts to tailor existing international protocols.

Engage in the amendment and revision processes for existing emissions measurement
methodologies wherever possible.



Engage in inclusive technical dialogues and co-ordination activities for measurement
methodologies and data collection for the emissions from materials and fuels
production.

Engage in constructive dialogue about definitions that differentiate according toemissions performance to identify areas of common understanding and establish ways
to make definitions interoperable, as well as to share knowledge on their potential use
in policy instruments.

Chapter 4 | Secure, equitable and co-operative transitions

183

IEA. CC BY 4.0.

Recommended policy actions to advance international co-operation in setting standards anddefinitions include (IEA, 2022c; IEA, 2023c; IEA, 2023d):

Diversify clean technology supply chains
Many supply chains for clean energy technologies are characterised by a high degree ofconcentration, and this entails major risks for security of supply. Concentration at any point
along a supply chain makes the entire chain vulnerable to disruption arising from individual
country policy choices, company decisions, natural disasters or technical failures. Disruptionof this kind is very likely to drive up prices of intermediate and final products and hamper
clean energy transitions.
Clean energy technology supply chains today are generally more geographicallyconcentrated than those of fossil fuels. Today just three countries account for about 90% of
global lithium mining output; the equivalent figures for cobalt, nickel and copper are 75%,
65% and 45% respectively. When it comes to production of key clean energy massmanufactured technologies – solar PV modules, wind turbine nacelles, EV batteries andelectrolysers – just three countries account for 80-90% of global capacity (Figure 4.20) (IEA,
2023f). In the case of solar PV, some individual manufacturing plants in China can produce
more modules than entire countries. For instance, the LONGi plant in Taizhou – the largest
operating plant in China – could have supplied half of the capacity additions of solar PV
modules in the European Union in 2022 (38 GW).
Figure 4.20 ⊳ Current and projected geographical concentration of

manufacturing operations for selected clean energy technologies

100%

Solar PVWind

Batteries

Electrolysers

Heat pumps

Other
United States
European Union
India
Viet Nam
China

75%
50%

Pipeline

Current

Pipeline

Current

Pipeline

Current

Pipeline

Current

Pipeline

Current

25%

IEA. CC BY 4.0.

Notes: Wind refers to onshore wind nacelles in this figure. For electrolysers, it only includes projects for which
location data were available. Shares are based on manufacturing capacity. Current refers to installed capacity
data for 2022 and first quarter 2023 where available. Pipeline refers to the sum of current installed capacity
and all announced manufacturing capacity additions (as of end of first quarter 2023) through to 2030. Other
refers to the aggregate of all capacity besides that of the top-three countries/regions for each technology andtimeframe. See The State of Clean Technology Manufacturing (IEA, 2023f) for more details.

184

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Announced projects – if all realised – will alter the global distributionof manufacturing capacity for batteries, electrolysers and heat pumps

The pipeline of announced projects for mass manufacturing of clean energy technologies
points to a limited fall in geographical concentration of some but not all clean technologies
in the coming years. If all solar PV and wind projects that have been announced come tofruition, concentration among the top-three producers would remain similar to current levels
by 2030 (85-90%), with China’s share remaining virtually unchanged (80% for solar, 65% forwind). By contrast, if all announced manufacturing projects for batteries, electrolysers andheat pumps come to fruition, the shares of the top-three producers would change, though
China would still maintain a strong position. For example, the share of global battery
manufacturing capacity in China would fall to around two-thirds, while that of the UnitedStates would jump to 15% and the European Union to 11%.

4

Policy makers need to balance the need to address overdependence on a limited range ofsources of materials and technologies on the one hand with the benefits of an open
international trading system on the other. Dominance of clean energy technology supply
chains by a handful of countries presents obvious security concerns and will inevitably invite
policy reactions from other countries. At the same time, overzealous moves to de-risk or
localise supply chains risk undermines the benefits of global supply chains, raises costs andhinders the clean energy transition.
At their summit in May 2023, G7 countries expressed the importance of building resilient,secure and sustainable supply chains to accelerate the clean energy transition and to reduce
vulnerabilities associated with undue dependencies (G7 Ministers of Climate, 2023).
Countries can address risks at the domestic level by developing dedicated industrial
strategies and making the most of their competitive advantages. International co-operation
will remain crucial to share lessons learned and to build partnerships as well as efforts toensure the smooth operation of regional and global supply chains.



Identify the major clean energy technology supply chain risks that could delay or
disrupt deployment and hinder resilience in case of disruption. While much attention
currently focuses on the security of supply of critical minerals, other elements could be
problematic as well.



Build strategic partnerships where it is not realistic or efficient to compete in a supply
chain or supply chain segment. Identifying relative strengths and seeking
complementary partnerships should be central to industrial strategies for clean
technology manufacturing.



Facilitate investment in emerging market and developing economies through pooled
investments, knowledge-sharing and other strategies designed to reduce risks forcapital-intensive components of supply chains and spread the benefits of the new clean
energy economy. Funding provisions for specific projects in appropriate cases should be
dependent on adequate environmental, social and governance regulations being inplace.

Chapter 4 | Secure, equitable and co-operative transitions

185

IEA. CC BY 4.0.

Recommended policy actions to enhance supply chain diversity include:Promote technologies and strategies to enhance resource efficiency, thereby
increasing the resilience of clean technology supply chains. Among others,
manufacturing processes that minimise material use, technology designs that allow for
the use of substitute materials when security of supply is in question, and productdesigns that facilitate reuse, repairability and recyclability should be promoted throughinnovation policy.

Step up clean energy technology demonstration projects
Accelerating innovation cycles for early stage clean energy technologies is vital to meet net
zero emissions goals. Bringing clean energy technologies under development today tomarket by 2030 requires advancing from prototype to market significantly faster on averagethan some of the quickest energy technology developments in the past. Such an acceleration
would require demonstrating technologies not yet available on the market quickly, at scale,in multiple technical configurations and in various locations and situations. In most cases in
the NZE Scenario, these demonstrations run in parallel, in contrast with usual practicewhereby learning is transferred across consecutive projects in different contexts to build
confidence before widespread deployment begins.
Government support for clean energy demonstrations is crucial, particularly in sectors where
economies of scale favour large installations. Private financing is often hard to put in placewhen large installations are necessary because of the very significant sums of money
involved (sometimes over USD 1 billion). This is much less of an issue with massmanufactured equipment or digital consumer goods, where experimentation at commercial
scale can usually be carried out at much lower cost. In 2022, 16 governments together
committed USD 94 billion by 2026 for clean energy demonstration projects (US Departmentof Energy, 2022). The size of this commitment is broadly in line with the amount that the IEA
calculated was needed two years ago (IEA, 2021a). If all this funding is forthcoming, it will
give a tremendous boost to the commercialisation of emerging technologies.

When assessing the need for clean energy demonstrations, we assume a high level ofinternational co-operation. The sharing of knowledge and learning among stakeholders andprojects is critical to the process of making technological advances, and that remains true
even when projects fail. Information sharing among governments promotes more informed
policy making and helps ensure that new projects complement others taking place
186

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

While it is too early to match recent government pledges with new projects, IEA tracking
suggests that progress is underway in several critical areas (IEA, 2023g). These include largescale solid oxide electrolysers for hydrogen production, industrial-scale hydrogen-based
steelmaking through direct reduced iron, carbon capture demonstrations in cement
production, first-of-a-kind direct air capture, small electric planes, low-emissions jet fuels
production, novel foundations for floating offshore wind turbines and small modular nuclear
reactors. Nearly 80% of around 200 recent demonstration programmes are in advanced
economies, primarily in Europe (55%) and North America (15%), with about 10% in China and
10% in other emerging market and developing economies.

elsewhere. Without such co-operation, the number of projects would certainly beunnecessarily larger and the portfolio more costly. International co-operation also increases
the chances that demonstration projects will take place in the best locations for thoseprojects, and that supply chains will operate smoothly to the benefit of those demonstration
projects.
Recommended policy actions to boost clean energy demonstration include:
Increase engagement with emerging market and developing economies on clean
energy demonstrations. Technologies will generally be more commercially successful inemerging market and developing economies if they are tested in the relevant climatic,
regulatory and market conditions.



Set up international tracking mechanisms to measure progress and adjust priorities
over time. Such mechanisms can help to ensure that investments are focussed in criticalareas, to share learnings with international partners and to build evidence-based
support for clean energy projects.



Tap into existing multilateral initiatives. Existing fora such as the IEA Technology
Collaboration Programmes and Mission Innovation can help share technology and policy
best practice across borders, while multilateral financial institutions and developmentbanks have expert knowledge of how to share investment risks for large-scale projects.

Share financing risks during the early stages of new technology deployment and send
clear demand signals thereafter. Even after they have been demonstrated successfully,
new technologies often face more risks than incumbent technologies. Instruments likegrants, public debt guarantees and concessional finance can help to mitigate these risks,
thereby increasing the likelihood of these technologies being able to secure private
sector investment. Early signals that there will be a broader market in which toparticipate can also increase the incentives to invest in demonstration projects andinitial deployment.

Chapter 4 | Secure, equitable and co-operative transitions

187

4

IEA. CC BY 4.0.

IEA. CC BY 4.0.

ANNEXESAnnex A
Tables for scenario projections
General note to the tables
This annex includes global historical and projected data for the Net Zero Emissions by 2050
(NZE) Scenario for the following datasets: A.1: Energy supply
 A.2: Total final energy consumption
 A.3: Electricity sector: gross electricity generation and electrical capacity
 A.4: CO₂ emissions: carbon dioxide (CO2) emissions from fossil fuel combustion andindustrial processes A.5: Indicators and activity: selected economic and activity indicators

Definitions for regions, fuels and sectors are outlined in Annex B.
Abbreviations/acronyms used in the tables include: CAAGR = compound average annual
growth rate; CCUS = carbon capture, utilisation and storage; EJ = exajoule; GJ = gigajoule;
GW = gigawatt; Mt CO₂ = million tonnes of carbon dioxide; TWh = terawatt-hour. Use of fossil
fuels in facilities without CCUS is classified as “unabated”.
Both in the text of this report and in these annex tables, rounding may lead to minor
differences between totals and the sum of their individual components. Growth rates arecalculated on a compound average annual basis and are marked “n.a.” when the base year
is zero or the value exceeds 200%. Nil values are marked “-”.
The tables for scenario projections will be available for download as part of the World Energy
Outlook 2023 free dataset to be released at the end of October 2023: https://iea.li/weo-data

Data sources
The Global Energy and Climate (GEC) Model is a very data-intensive model covering thewhole global energy system. Detailed references on databases and publications used in themodelling and analysis may be found in Annex E of the World Energy Outlook 2023 1.

1 The World Energy Outlook 2023 will be released at the end of October 2023.

Annex A | Tables for scenario projections

191

IEA. CC BY 4.0.

The formal base year for this year’s projections is 2021, as this is the last year for which acomplete picture of energy demand and production is in place. However, we have used more
recent data wherever available, and we include our 2022 estimates for energy production
and demand in this annex (Tables A.1 to A.3). Estimates for the year 2022 are based on the
IEA CO2 Emissions in 2022 report which are derived from a number of sources, including thelatest monthly data submissions to the IEA Energy Data Centre, other statistical releases fromnational administrations, and recent market data from the IEA Market Report Series thatcover coal, oil, natural gas, renewables and power. Investment estimates include the year
2022, based on the IEA World Energy Investment 2023 report.

Historical data for gross power generation capacity (Table A.3) are drawn from the S&P
Global Market Intelligence World Electric Power Plants Database (March 2023 version) andthe International Atomic Energy Agency PRIS database.

Definitional note: A.1 Table: Energy supply and transformation
Total energy supply (TES) is equivalent to electricity and heat generation plus the otherenergy sector, excluding electricity, heat and hydrogen, plus total final consumption,
excluding electricity, heat and hydrogen. TES does not include ambient heat from heatpumps or electricity trade. Solar in TES includes solar photovoltaic (PV) generation,
concentrating solar power (CSP) and final consumption of solar thermal. Biofuels conversion
losses are the conversion losses to produce biofuels (mainly from modern solid bioenergy)
used in the energy sector. Low‐emissions hydrogen production is merchant low‐emissionshydrogen production (excluding onsite production at industrial facilities and refineries), with
inputs referring to total fuel inputs and outputs to produced hydrogen. While not itemised
separately, geothermal and marine (tidal and wave) energy are included in the renewables
item of TES and electricity and heat sectors. While not itemised separately, non-renewablewaste and other sources are included in TES.

Definitional note: A.2 Table: Energy demand
Sectors comprising total final consumption (TFC) include industry (energy use andfeedstock), transport and buildings (residential, services and non-specified other). While notitemised separately, agriculture and other non-energy use are included in TFC. While notitemised separately, non-renewable waste, solar thermal and geothermal energy areincluded in buildings, industry and TFC. Aviation and navigation include both domestic andinternational energy demand. Energy demand from international marine and aviation
bunkers are included in global transport totals, and TFC.

Definitional note: A.3 Table: Electricity
Electricity generation expressed in terawatt-hours (TWh) and installed electrical capacity
data expressed in gigawatts (GW) are both provided on a gross basis, i.e. includes own use
by the generator. Projected gross electrical capacity is the sum of existing capacity andadditions, less retirements. While not itemised separately, other sources are included in total
electricity generation. Installed capacity for hydrogen and ammonia refers to full conversion
only, not including co-firing with natural gas or coal.

Total CO2 includes carbon dioxide emissions: from the combustion of fossil fuels andnon-renewable wastes; from industrial and fuel transformation processes (process
emissions); and CO2 emissions from flaring and CO2 removal. CO2 removal includes: captured
and stored emissions from the combustion of bioenergy and renewable wastes; from
biofuels production; and from direct air capture (DAC).

192

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Definitional note: A.4 Table: CO2 emissions

The first two entries are often reported as bioenergy with carbon capture and storage(BECCS). Note that some of the CO2 captured from biofuels production and direct air capture
is used to produce synthetic fuels, which is not included as CO2 removal.
Total CO2 captured includes the carbon dioxide captured from CCUS facilities, such as
electricity generation or industry, and atmospheric CO2 captured through direct air capture,but excludes that captured and used for urea production. Aviation and navigation include
both domestic and international emissions.

Definitional note: A.5 Table: Economic and activity indicators
The emission intensity expressed in kilogrammes of carbon dioxide per kilowatt‐hour (kg CO2
per kWh) is calculated based on electricity‐only plants and the electricity component of
combined heat and power (CHP) plants 2. Primary chemicals include ethylene, propylene,
aromatics, methanol and ammonia. Industrial production data for aluminium excludes
production based on internally generated scrap. Heavy-duty trucks activity includes freightactivity of medium freight trucks and heavy freight trucks. Aviation activity includes both
domestic and international flight activity. Shipping activity refers to international shipping
activity.
Abbreviations used include: GDP = gross domestic product; GJ = gigajoules; m2 = square
metres Mt = million tonnes; pkm = passenger‐kilometres; PPP = purchasing power parity;
tkm = tonnes‐kilometres.

Annex A licencing

2 To derive the associated electricity‐only emissions from CHP plants, we assume that the heat production of

a CHP plant is 90% efficient and the remainder of the fuel input is allocated to electricity generation.

Annex A | Tables for scenario projections

193

IEA. CC BY 4.0.

Subject to the IEA’s Notice for CC-licenced Content, this Annex A to Net Zero Emissions by
2050: A Roadmap for the Global Energy Sector – 2023 Update is licensed under a Creative
Commons Attribution-NonCommercial-ShareAlike 4.0 International Licence.

A

Table A.1: World energy supply
Net Zero Emissions by 2050 Scenario (EJ)CAAGR (%)
2022 to:Shares (%)

2010

2021

2022

2030

2035

2040

2050

2022

2030

2050

2030

2050

Total energy supply

541

624

632

573

535

528

541

100

100

100

-1.2

-0.6

Renewables

43

71

75

166

241

306

385

12

29

71

10

6.0

Solar

1

5

7

35

66

97

138

1

6

26

23

11

Wind

1

7

8

25

43

61

84

1

4

16

16

9.0

Hydro

12

15

16

20

24

27

30

2

3

5

2.9

2.3

Modern solid bioenergy

23

33

35

55

65

71

73

6

10

13

5.8

2.6

Modern liquid bioenergy

2

4

4

11

13

13

11

1

2

2

13

3.3

Modern gaseous bioenergy

1

1

1

7

9

11

15

0

1

3

22

9.0

Traditional use of biomass

25

24

24

-

-

-

-

4

-

-

n.a.

n.a.

Nuclear

30

31

29

43

55

63

67

5

8

12

5.0

3.0

Unabated natural gas

115

146

144

112

68

40

14

23

20

3

-3.0

-8.1

Natural gas with CCUS
Oil

0

1

1

6

9

13

18

0

1

3

35

13

173

182

187

148

110

79

42

30

26

8

-2.8

-5.2

25

31

32

35

34

33

30

5

6

6

1.3

-0.1

Unabated coal

153

167

170

93

43

16

3

27

16

1

-7.3

-14

Coal with CCUS

-

0

0

2

7

10

12

0

0

2

87

27

Electricity and heat sectors

200

244

247

256

277

319

393

100

100

100

0.4

1.7

Renewables

20

39

41

103

167

228

306

17

40

78

12

7.4

Solar PV

0

4

5

29

56

80

112

2

11

29

26

12

Wind

1

7

8

25

43

61

84

3

10

21

16

9.0

Hydro

12

15

16

20

24

27

30

6

8

8

2.9

2.3

Bioenergy

4

9

9

17

24

30

36

4

6

9

7.3

4.9

-

-

-

2

4

5

6

-

1

2

n.a.

n.a.
n.a.

Non-energy use

HydrogenAmmonia

-

-

-

1

2

2

2

-

0

1

n.a.

Nuclear

30

31

29

43

55

63

67

12

17

17

5.0

3.0

Unabated natural gas

47

57

57

49

25

11

1

23

19

0

-1.7

-13
n.a.

Natural gas with CCUS

-

-

-

0

2

2

3

-

0

1

n.a.

Oil

11

8

8

2

1

0

0

3

1

0

-17

-23

Unabated coal

91

108

110

53

16

0

-

45

21

-

-8.9

n.a.

Coal with CCUS

-

0

0

2

5

6

7

0

1

2

102

29

50

64

65

64

64

70

78

100

100

100

-0.2

0.7

-

5

6

14

16

16

12

100

100

100

11

2.6

Production inputs

-

0

0

9

20

33

54

100

100

100

n.a.

n.a.

Production outputs

-

0

0

6

14

23

39

100

100

100

144

38

-

-

-

2

5

10

17

-

31

43

n.a.

n.a.

Other energy sector
Biofuels conversion losses

For hydrogen-based fuels

194International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Low-emissions hydrogen (offsite)Table A.2: World final energy consumption
CAAGR (%)
2022 to:Shares (%)

2010

2021

2022

2030

2035

2040

2050

2022

2030

2050

2030

2050

Total final consumption

383

436

442

406

379

360

343

100

100

100

-1.1

-0.9

Electricity

64

87

89

113

133

154

183

20

28

53

3.0

2.6

Liquid fuels

154

168

172

150

120

94

62

39

37

18

-1.7

-3.6

Biofuels

2

4

4

11

13

13

11

1

3

3

13

3.3

Ammonia

-

-

-

1

2

2

4

-

0

1

n.a.

n.a.

-

-

-

0

1

2

6

-

0

2

n.a.

n.a.

Oil

151

164

168

138

104

76

41

38

34

12

-2.4

-4.9

Gaseous fuels-2.0

Synthetic oil

58

72

71

61

52

45

41

16

15

12

-1.8

Biomethane

0

0

0

4

6

6

8

0

1

2

42

13

Hydrogen

-

0

0

2

5

8

16

0

1

5

113

33

Synthetic methane
Natural gas
Solid fuels

-

-

-

-

-

-

-

-

-

-

n.a.

n.a.

57

72

70

54

41

29

15

16

13

4

-3.2

-5.3

95

92

93

63

54

45

35

21

15

10

-4.8

-3.4

Solid bioenergy

38

39

40

24

26

26

28

9

6

8

-6.1

-1.2

Coal

56

52

52

38

27

18

7

12

9

2

-3.9

-6.9

Heat

12

15

15

12

11

9

6

3

3

2

-2.1

-3.2

Industry

143

167

167

175

173

169

159

100

100

100

0.6

-0.2

Electricity

27

37

38

52

62

70

79

23

30

49

4.2

2.7

Liquid fuels

29

33

32

34

32

29

24

19

19

15

0.7

-1.0

Oil

29

33

32

34

31

28

23

19

19

14

0.5

-1.2

Gaseous fuels

24

31

30

30

28

25

21

18

17

13

-0.1

-1.3

Biomethane

0

0

0

1

2

3

4

0

1

3

43

15

Hydrogen

-

0

0

1

2

4

5

0

1

3

137

36

24

31

30

27

21

16

6

18

15

4

-1.5

-5.3

Unabated natural gas
Natural gas with CCUS
Solid fuels

-

0

0

1

2

3

5

0

1

3

46

18

58

58

59

52

45

38

29

35

30

18

-1.5

-2.5

Modern solid bioenergy

8

10

11

15

18

20

22

7

9

14

4.2

2.5

Unabated coal

49

47

47

36

24

15

2

28

20

1

-3.5

-10

-

0

0

1

2

4

5

0

0

3

71

25

Heat

5

7

7

5

4

3

1

4

3

1

-3.9

-6.1

Chemicals

38

48

48

54

55

55

51

29

31

32

1.6

0.2

Iron and steel

31

37

35

34

32

30

26

21

19

17

-0.6

-1.0

Cement

9

12

12

12

11

11

10

7

7

6

-0.4

-0.7

Aluminium

5

7

7

7

6

6

5

4

4

3

-0.4

-1.1

Coal with CCUS

Annex A | Tables for scenario projections

195

IEA. CC BY 4.0.

Net Zero Emissions by 2050 Scenario (EJ)A

Table A.2: World final energy consumption (continued)
CAAGR (%)
2022 to:Shares (%)

2010

2021

2022

2030

2035

2040

2050

2022

2030

2050

2030

2050

Transport

102

112

116

105

89

79

76

100

100

100

-1.3

-1.5

Electricity

1

1

2

8

15

25

38

1

8

51

23

12

Liquid fuels

97

106

110

92

69

49

26

94

88

35

-2.2

-5.0

Biofuels

2

4

4

10

12

11

8

4

10

11

12

2.6

Oil

95

102

105

81

55

33

8

91

77

10

-3.3

-8.9

Gaseous fuels

4

5

5

5

4

5

11

5

4

15

-1.9

2.7

Biomethane

0

0

0

0

0

0

0

0

0

0

18

5.1

Hydrogen

-

0

0

1

2

4

10

0

1

14

98

32

Natural gas

4

5

5

3

2

1

0

4

3

0

-5.6

-11

Road
Passenger cars
Heavy-duty trucks

76

87

89

74

60

52

47

76

71

62

-2.2

-2.2

38

44

45

32

22

17

15

38

30

20

-4.1

-3.7
-0.8

21

26

27

27

26

24

22

23

26

29

0.2

Aviation

11

9

11

15

14

14

15

10

14

20

3.5

1.2

Shipping

10

11

11

11

10

10

10

10

11

13

0.1

-0.4

Buildings

117

131

133

100

92

89

89

100

100

100

-3.4

-1.4

Electricity

35

45

46

48

51

55

62

35

48

70

0.5

1.1

Liquid fuels

13

13

13

9

5

3

1

10

9

1

-5.1

-8.5

Biofuels

-

-

-

0

0

0

0

-

0

0

n.a.

n.a.

Oil

13

13

13

9

5

3

1

10

9

1

-5.2

-9.5

Gaseous fuels

-6.5

27

31

31

22

15

10

5

23

22

5

-4.1

Biomethane

0

0

0

2

3

3

3

0

2

3

53

14

Hydrogen

-

-

-

0

0

0

0

-

0

0

n.a.

n.a.

Natural gas

26

31

30

19

11

5

0

23

19

0

-5.8

-22

35

32

32

9

8

6

6

24

9

6

-14

-6.0

Solid fuels
Modern solid bioenergy

4

4

4

8

8

6

6

3

8

6

8.4

1.0

Traditional use of biomass

25

24

24

-

-

-

-

18

-

-

n.a.

n.a.

Coal

6

4

4

1

0

0

0

3

1

0

-14

-26

Heat

6

7

7

7

6

6

5

5

7

5

-0.5

-1.7

Residential

83

93

93

65

59

57

58

71

65

65

-4.4

-1.7

Services

34

38

39

35

33

31

31

29

35

35

-1.3

-0.8

196

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Net Zero Emissions by 2050 Scenario (EJ)

Table A.3: World electricity sector
CAAGR (%)
2022 to:Shares (%)

2010

2021

2022

2030

2035

2040

2050

2022

2030

2050

2030

Total generation

21 53328 34628

29 03338 207

4
47
7 427

5
59
9 111

76 838

100

100

100

3.5

3.5

Renewables

4 209

7 964

8 599

22 53236 73950 459

6
68
8 430

30

59

89

13

7.7

Solar PV

32

1 023

1 291

8 177

15 43922 24131 237

4

21

41

26

12

Wind

342

1 865

2 125

7 070

11 92316 82623 442

7

19

31

16

9.0

Hydro

3 456

4 299

4 378

5 507

6 530

7 435

8 225

15

14

11

2.9

2.3

309

666

687

1 313

1 885

2 396

3 056

2

3

4

8.4

5.5
n.a.

Bioenergy

2050

of which BECCS

-

-

-

65

300

471

644

-

0

1

n.a.

CSP

2

15

16

139

414

831

1 486

0

0

2

31

18

Geothermal

68

96

101

306

508

662

862

0

1

1

15

7.9

MarineNuclear

1

1

1

19

39

67

123

0

0

0

44

19

2 756

2 810

2 682

3 936

4 952

5 583

6 015

9

10

8

4.9

2.9

Hydrogen and ammonia

-

-

-

373

745

1 028

1 161

-

1

2

n.a.

n.a.

Fossil fuels with CCUS

-

1

1

220

681

847

996

0

1

1

105

30

Coal with CCUS

-

1

1

156

455

547

644

0

0

1

97

28

Natural gas with CCUS

-

-

-

64

226

301

353

-

0

0

n.a.

n.a.
-15

Unabated fossil fuels

14 47917 456

17 636

11 066

4 241

1 121

158

61

29

0

-5.7

Coal

8 669

10 247
10

1
10
0 427

4 988

1 379

-

-

36

13

-

-8.8

n.a.

Natural gas

4 847

6 526

6 500

5 943

2 834

1 119

158

22

16

0

-1.1

-12

963

683

709

135

28

2

1

2

0

0

-19

-23

Oil

Net Zero Emissions by 2050 Scenario (GW)CAAGR (%)
2022 to:Shares (%)

2010

2021

2022

2030

2035

2040

2050

2022

2030

2050

2030

2050

Total capacity

5 187

8 230

8 643

1
16
6 180

23 06729 35436 956

100

100

100

8.2

5.3

Renewables

1 333

3 292

3 629

11 00817 46023 33130 275

42

68

82

15

7.9

Solar PV

39

925

1 145

6 101

10 43014 30318 753

13

38

51

23

11

Wind

181

827

902

2 742

4 322

5 797

7 616

10

17

21

15

7.9

Hydro

1 027

1 360

1 392

1 765

2 054

2 313

2 612

16

11

7

3.0

2.3

74

159

168

296

426

541

688

2

2

2

7.3

5.2
n.a.

Bioenergyof which BECCS

-

-

-

15

59

87

114

-

0

0

n.a.

CSP

1

6

7

48

134

251

427

0

0

1

27

16

Geothermal

10

15

15

48

78

99

129

0

0

0

16

8.0

MarineNuclear

0

1

1

8

16

27

48

0

0

0

34

16

403

413

417

541

688

813

916

5

3

2

3.3

2.9

Hydrogen and ammonia

-

-

-

129

367

447

427

-

1

1

n.a.

n.a.

Fossil fuels with CCUS

-

0

0

50

141

203

241

0

0

1

113

31

Coal with CCUS

-

0

0

36

95

131

153

0

0

0

104

29

Natural gas with CCUS

-

-

-

14

46

72

89

-

0

0

n.a.

n.a.
-5.6

Unabated fossil fuels

3 439

4 480

4 535

3 423

2 453

1 710

892

52

21

2

-3.5

Coal

1 614

2 200

2 236

1 457

910

548

242

26

9

1

-5.2

-7.6

Natural gas

1 389

1 854

1 875

1 746

1 402

1 088

611

22

11

2

-0.9

-3.9

436

426

423

220

141

75

39

5

1

0

-7.8

-8.2

1

27

45

1 018

1 949

2 841

4 199

1

6

11

48

18

Oil
Battery storage

Annex A | Tables for scenario projections

197

IEA. CC BY 4.0.

Net Zero Emissions by 2050 Scenario (TWh)A

Table A.4: World CO2 emissions
CAAGR (%)
2022 to:Net Zero Emissions by 2050 Scenario (Mt CO2)
2010

2021

2022

2030

2035

2040

2050

2030

2050

Total CO2*

32 87736 58936 93024 03013 375

6 471

-

-5.2

n.a.

Combustion activities (+)

30 62433 63434 04221 95812 017

5 820

655

-5.3

-13

Coal

13 84615 10415 330

8 173

3 541

1 200

171

-7.6

-15

Oil

10 545

10 68310 963

7 910

5 325

3 219

824

-4.0

-8.8

Natural gas

6 052

7 577

7 499

5 795

3 327

1 780

358

-3.2

-10

181

269

251

80

- 176

- 379

- 698

-13

n.a.

Other removals** (-)

-

1

2

167

348

523

933

78

25

Biofuels production

-

1

2

98

186

227

312

67

21

Direct air capture

-

-

-

69

162

295

621

n.a.

n.a.

Bioenergy and waste

Electricity and heat sectors

12 511

14 59814 822

8 113

2 854

411

- 275

-7.3

n.a.

Coal

8 946

10 646

10 876

5 156

1 545

42

21

-8.9

-20

Oil

828

574

596

135

45

23

0

-17

-23

2 623

3 227

3 201

2 781

1 401

604

78

-1.7

-12

Natural gas
Bioenergy and waste

114

151

149

41

- 138

- 257

- 374

-15

n.a.

Other energy sector**

1 438

1 530

1 554

782

322

108

- 198

-8.2

n.a.
-9.9

Final consumption**

18 66820 19120 29315 187

10 350

6 241

1 088

-3.6

Coal

4 699

4 355

4 352

2 983

1 971

1 142

138

-4.6

-12

Oil

9 087

9 552

9 815

7 398

4 993

2 989

711

-3.5

-9.0

Natural gas

2 842

3 566

3 500

2 543

1 718

1 036

173

-3.9

-10

66

118

102

43

- 26

- 93

- 205

-10

n.a.

8 324

9 185

8 998

7 158

5 111

3 222

440

-2.8

-10

1 201

1 329

1 330

1 150

850

521

45

-1.8

-11
-8.3

Bioenergy and waste
Industry**
Chemicals**
Iron and steel**

2 083

2 733

2 623

2 118

1 584

1 032

233

-2.6

Cement**

1 916

2 514

2 418

1 911

1 343

875

79

-2.9

-12

Aluminium**

185

261

265

218

172

107

8

-2.4

-12

Transport

7 014

7 599

7 874

5 992

4 062

2 430

578

-3.4

-8.9

Road

5 216

5 847

5 964

4 213

2 718

1 491

236

-4.2

-11

Passenger cars

2 609

2 930

2 975

1 752

916

403

37

-6.4

-14

Heavy-duty trucks

1 489

1 766

1 812

1 610

1 284

856

178

-1.5

-8.0

754

661

792

932

744

554

208

2.0

-4.7

Aviation
Shipping

797

827

855

695

495

313

112

-2.6

-7.0

2 891

2 973

2 979

1 741

971

463

54

-6.5

-13

Residential

1 961

2 013

1 997

1 189

675

326

48

-6.3

-12

Services

929

959

983

552

296

137

6

-7.0

-16

Total CO2 removals**

-

2

2

234

632

995

1 710

85

28

Total CO2 captured**

15

41

42

1 024

2 421

3 724

6 040

49

19

Buildings*Includes industrial process and flaring emissions.

198

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

**Includes industrial process emissions.

Table A.5: Economic and activity indicators
CAAGR (%)
2022 to:Net Zero Emissions by 2050 Scenario
2010

2021

2022

2030

2035

2040

2050

2030

2050
0.7

Indicators
Population (million)

6 967

7 884

7 950

8 520

8 853

9 161

9 681

0.9

GDP (USD 2022 billion, PPP)

114 463

158 505

163 734

207 282

238 066

270 050339 273

3.0

2.6

GDP per capita (USD 2022, PPP)

16 42920 10420 59624 32926 89229 47935 044

2.1

1.9

TES/GDP (GJ per USD 1 000, PPP)

4.7

3.9

3.9

2.8

2.3

2.0

1.6

-4.1

-3.1

TFC/GDP (GJ per USD 1 000, PPP)

3.2

2.6

2.6

1.9

1.5

1.3

1.0

-3.9

-3.3

CO₂ intensity of electricity
generation (g CO₂ per kWh)

528

464

460

186

48

3

-4

-11

n.a.

Industrial production (Mt)
515

713

719

861

905

916

878

2.3

0.7

Steel

1 435

1 960

1 878

1 973

1 966

1 958

1 957

0.6

0.1

Cement

3 280

4 374

4 158

4 264

4 140

4 022

3 934

0.3

-0.2

Aluminium

62

105

108

120

128

136

146

1.4

1.1

Primary chemicals

Transport
Passenger cars (billion pkm)

18 98425 67926 53528 60830 35533 84141 6380.9

1.6

Heavy-duty trucks (billion tkm)

23 36429 48230 47938 03743 34149 03660 3352.8

2.5

Aviation (billion pkm)

4 923

3 673

6 025

10 96911 417

12 84316 545

7.8

3.7

Shipping (billion tkm)

77 101

115 830

124 272

145 087

165 073

188 756

265 253

2.0

2.7

Buildings
Households (million)

1 798

2 175

2 208

2 439

2 579

2 715

2 963

1.2

1.1

Residential floor area (million m²)

153 219

194 691

198 090

227 039

247 262

268 130

310 109

1.7

1.6

Services floor area (million m²)

39 26253 41554 62463 89169 19774 14382 7642.0

1.5

Annex A | Tables for scenario projections

199

IEA. CC BY 4.0.

AAnnex B
Definitions
This annex provides general information on terminology used throughout this report
including: units and general conversion factors; definitions of fuels, processes and sectors;
regional and country groupings; and abbreviations and acronyms.

Area

km2
Mha

square kilometre
million hectares

Batteries

Wh/kg

watt hours per kilogramme

Coal

Mtce

million tonnes of coal equivalent (equals 0.7 Mtoe)

Distancekm

kilometre

Emissions

ppm
t CO2
Gt CO2-eq
kg CO2-eq
g CO2/km
g CO2/kWhkg CO2/kWhparts per million (by volume)
tonnes of carbon dioxide
gigatonnes of carbon-dioxide equivalent (using 100-year
global warming potentials for different greenhouse gases)
kilogrammes of carbon-dioxide equivalent
grammes of carbon dioxide per kilometre
grammes of carbon dioxide per kilowatt-hourkilogrammes of carbon dioxide per kilowatt-hour

Energy

EJ
PJ
TJ
GJ
MJ
boe
toe
ktoe
Mtoe
bcme
MBtu
kWh
MWh
GWh
TWh
Gcal

exajoule (1 joule x 1018)
petajoule (1 joule x 1015)
terajoule (1 joule x 1012)
gigajoule (1 joule x 109)
megajoule (1 joule x 106)barrel of oil equivalent
tonne of oil equivalent
thousand tonnes of oil equivalentmillion tonnes of oil equivalentbillion cubic metres of natural gas equivalentmillion British thermal units
kilowatt-hour
megawatt-hour
gigawatt-hour
terawatt-hourgigacalorie

Gas

bcm
tcm

billion cubic metres
trillion cubic metres

Mass

kg
t
kt
Mt
Gt

kilogrammetonne (1 tonne = 1 000 kg)
kilotonnes (1 tonne x 103)
million tonnes (1 tonne x 106)
gigatonnes (1 tonne x 109)

Annex B | Definitions

201

IEA. CC BY 4.0.

Units

Monetary

USD million
USD billion
USD trillion
USD/t CO2

1 US dollar x 106
1 US dollar x 109
1 US dollar x 1012
US dollars per tonne of carbon dioxide

Oil

kb/d
mb/d
mboe/dthousand barrels per day
million barrels per day
million barrels of oil equivalent per day

Power

W
kW
MW
GW
TW

watt (1 joule per second)kilowatt (1 watt x 103)
megawatt (1 watt x 106)
gigawatt (1 watt x 109)
terawatt (1 watt x 1012)

General conversion factors for energy

Convert from:

Multiplier to convert to:
EJ

Gcal

Mtoe

MBtu

bcme

GWh

EJ

1

2.388 x 108

23.88

9.478 x 108

27.78

2.778 x 105

Gcal

4.1868 x 10-9

1

10-7

3.968

1.163 x 10-7

1.163 x 10-3

Mtoe

4.1868 x 10-2

107

1

3.968 x 107

1.163

11 630MBtu

1.0551 x 10-90.252

2.52 x 10-8

12.932 x 10-8

2.931 x 10-4

bcme

0.036

8.60 x 106

0.86

3.41 x 107

1

9 999

GWh

3.6 x 10-6860

8.6 x 10-5

3 412

1 x 10-41

Note: There is no generally accepted definition of boe; typically, the conversion factors used vary from 7.15 to
7.40 boe per toe. Natural gas is attributed a low heating value of 1 MJ per 44.1 kg. Conversions to and frombillion cubic metres of natural gas equivalent (bcme) are given as representative multipliers but may differ
from the average values obtained by converting natural gas volumes between IEA balances due to the use ofcountry-specific energy densities. Lower heating values (LHV) are used throughout.

Definitions
Advanced bioenergy: Sustainable fuels produced from non‐food crop feedstocks, which arecapable of delivering significant life cycle greenhouse gas emissions savings compared withfossil fuel alternatives, and which do not directly compete with food and feed crops for
agricultural land or cause adverse sustainability impacts. This definition differs from the oneused for “advanced biofuels” in US legislation, which is based on a minimum 50% life cycle
greenhouse gas reduction and, therefore, includes sugar cane ethanol.

Agriculture, forestry and other land use (AFOLU) emissions: Includes greenhouse gas
emissions from agriculture, forestry and other land use.

202

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Agriculture: Includes all energy used on farms, in forestry and for fishing.

Ammonia (NH3): Is a compound of nitrogen and hydrogen. It can be used as a feedstock inthe chemical sector, as a fuel in direct combustion processes or in fuel cells, and as ahydrogen carrier. To be considered a low‐emissions fuel, ammonia must be produced fromlow-emissions hydrogen. Produced in such a way, ammonia is considered a low‐emissionshydrogen‐based liquid fuel.
Aviation: This transport mode includes both domestic and international flights and their useof aviation fuels. Domestic aviation covers flights that depart and land in the same country;
flights for military purposes are included. International aviation includes flights that land ina country other than the departure location.
Back-up generation capacity: Households and businesses connected to a main power grid
may also have a source of back‐up power generation capacity that, in the event of disruption,
can provide electricity. Back‐up generators are typically fuelled with diesel or gasoline orbased on solar PV and battery technologies. Capacity can be as little as a few kilowatts. Suchcapacity is distinct from mini‐grid and off‐ grid systems that are not connected to a main
power grid.
Battery storage: Energy storage technology that uses reversible chemical reactions to absorb
and release electricity on demand.
Biodiesel: Diesel‐equivalent fuel made from the transesterification (a chemical process thatconverts triglycerides in oils) of vegetable oils and animal fats.
Bioenergy: Energy content in solid, liquid and gaseous products derived from biomass
feedstocks and biogas. It includes solid bioenergy, liquid biofuels and biogases.
Biogas: A mixture of methane, CO2 and small quantities of other gases produced byanaerobic digestion of organic matter in an oxygen‐free environment.
Biogases: Includes biogas and biomethane.
Biomethane: Biomethane is a near‐pure source of methane produced either by “upgrading”
biogas (a process that removes any carbon dioxide and other contaminants present in the
biogas) or through the gasification of solid biomass followed by methanation. It is also known
as renewable natural gas.

Buildings: The buildings sector includes energy used in residential and services buildings.
Services buildings include commercial and institutional buildings and other non‐specified
buildings. Building energy use includes space heating and cooling, water heating, lighting,appliances and cooking equipment.
Annex B | Definitions

203

IEA. CC BY 4.0.

Blended finance: A broad category of development finance arrangements that blend
relatively small amounts of concessional donor funds into investments in order to mitigate
specific investment risks. This can catalyse important investment that would otherwise be
unable to proceed under conventional commercial terms. These arrangements can be
structured as debt, equity, risk-sharing or guarantee products. Specific terms of thesearrangements, such as interest rates, tenor, security or rank, can vary across scenarios.

BBunkers: Includes both international marine bunker fuels and international aviation bunker
fuels.
Capacity credit: Proportion of the installed capacity that can be reliably expected to generate
electricity during times of peak demand in the grid to which it is connected.
Capital costs: Costs to develop and construct a fixed asset such as a power plant and grid
infrastructure or execute a project, excluding financing costs. For power generation assets,
capital costs include refurbishment and decommissioning costs.
Carbon capture, utilisation and storage (CCUS): The process of capturing carbon dioxide
emissions from fuel combustion, industrial processes or directly from the atmosphere.
Captured CO2 emissions can be stored in underground geological formations, onshore or
offshore, or used as an input or feedstock in manufacturing.
Cars: Include passenger cars, sport utility vehicles and light trucks.
Clean cooking systems, fuels, stoves and technologies: Cooking solutions that release lessharmful pollutants, are more efficient and environmentally sustainable than traditional
cooking options that make use of solid biomass (such as a three‐stone fire), coal or kerosene.
This refers to improved biomass cook stoves, biogas/biodigester systems, electric cooking
devices and liquefied petroleum gas, natural gas or ethanol fuelled stoves.
Clean energy: In power, clean energy includes generation from renewable sources, nuclear,fossil fuels fitted with CCUS, battery storage, and electricity grids. In efficiency, clean energy
includes energy efficiency in buildings, industry, and transport excluding aviation bunkers
and domestic navigation. In end‐use applications, clean energy includes direct use ofrenewables; electric vehicles; electrification in buildings, industry and international marinetransport; CCUS in industry and direct air capture. In fuel supply, clean energy includes low‐emissions fuels.
Coal: Includes both primary coal (including lignite, coking and steam coal) and derived fuels(including patent fuel, brown-coal briquettes, coke-oven coke, gas coke, gas-works gas, cokeoven gas, blast furnace gas and oxygen steel furnace gas). Peat is also included.
Coalbed methane: Category of unconventional natural gas that refers to methane found incoal seams.

Concessional financing: Resources extended at terms more favourable than those available
on the market. This can be achieved through one or a combination of the following factors:
interest rates below those available on the market; maturity, grace period, security, rank orback-weighted repayment profile that would not be accepted/extended by a commercial
financial institution; and/or by providing financing to the recipient otherwise not served bycommercial financing.

204

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Concentrating solar power (CSP): Thermal power generation technology that collects andconcentrates sunlight to produce high temperature heat to generate electricity.

Conventional liquid biofuels: Fuels produced from food crop feedstocks. Commonly referred
to as first generation biofuels and include sugar cane ethanol, starch‐based ethanol, fatty
acid methyl ester (FAME), straight vegetable oil (SVO) and hydrotreated vegetable oil (HVO)
produced from palm, rapeseed or soybean oil.
Critical minerals: A wide range of minerals and metals that are essential in clean energy
technologies and other modern technologies and have supply chains that are vulnerable todisruption. Although the exact definition and criteria differ among countries, critical minerals
for clean energy technologies typically include chromium, cobalt, copper, graphite, lithium,manganese, molybdenum, nickel, platinum group metals, zinc, rare earth elements and othercommodities, as listed in the Annex of the IEA special report on the Role of Critical Minerals
in Clean Energy Transitions available at: https://www.iea.org/reports/the‐role‐of‐critical‐
minerals‐in‐clean‐energy‐transitions.
Debt: Bonds or loans issued or taken out by a company to finance its growth and operations.
Decomposition analysis: Statistical approach that decomposes an aggregate indicator toquantify the relative contribution of a set of pre‐defined factors leading to a change in theaggregate indicator. The World Energy Outlook uses an additive index decomposition of thetype Logarithmic Mean Divisia Index (LMDI).
Demand-side integration (DSI): Consists of two types of measures: actions that influenceload shape such as energy efficiency and electrification; and actions that manage load suchas demand‐side response measures.
Demand-side response (DSR): Describes actions which can influence the load profile such as
shifting the load curve in time without affecting total electricity demand, or load shedding
such as interrupting demand for a short duration or adjusting the intensity of demand for acertain amount of time.
Direct air capture (DAC): Technology to capture CO2 directly from the atmosphere using
liquid solvents or solid sorbents. It is generally coupled with permanent storage of the CO2 indeep geological formations or its use in the production of fuels, chemicals, building materials
or other products. When coupled with permanent geological CO2 storage, DAC is a carbon
removal technology.
Direct air capture and storage (DACS): The process of capturing carbon dioxide emissions
directly from the atmosphere. Emissions are then stored in underground geologicalformations, onshore or offshore, or used as an input or feedstock in manufacturing.
Dispatchable generation: Refers to technologies whose power output can be readily
controlled, i.e. increased to maximum rated capacity or decreased to zero in order to match
supply with demand at any time except in cases of technical malfunction.

Annex B | Definitions

205

IEA. CC BY 4.0.

Electricity demand: Defined as total gross electricity generation less own use generation,plus net trade (imports less exports), less transmissions and distribution losses.

BEnergy efficiency investment: Incremental spending on new energy-efficient equipment or
the full cost of refurbishment that reduces energy use. The intention is to capture spendingthat leads to reduced energy consumption. Under conventional accounting, part of this iscategorised as consumption rather than investment.
Electricity generation: Defined as the total amount of electricity generated by power only or
combined heat and power plants including generation required for own use. This is also
referred to as gross generation.
Electric vehicles: Includes battery electric vehicles and plug-in hybrid electric vehicles.
End-use investment: Includes investment in three categories on the demand side: energy
efficiency, end-use renewables and other end-uses.
End-use sectors: Include industry, transport, buildings and others, i.e. agriculture and othernon-energy use.
Energy sector CO2 emissions: CO2 emissions from fossil fuel combustion, industrial
processes, and fugitive and flaring CO2 from fossil fuel extraction.
Energy sector greenhouse gas emissions: Energy‐related and industrial process CO2
emissions plus fugitive and vented methane (CH4) and nitrous oxide (N2O) emissions fromthe energy and industry sectors.
Energy services: See useful energy.
Ethanol: Refers to bioethanol only. Ethanol is produced from fermenting any biomass highin carbohydrates. Currently, ethanol is made from starches and sugars, but second‐
generation technologies will allow it to be made from cellulose and hemicellulose, the fibrousmaterial that makes up the bulk of most plant matter.
Fossil fuels: Include coal, natural gas and oil.
Gaseous fuels: Include natural gas, biogases, synthetic methane and hydrogen.
Geothermal: Geothermal energy is heat from the sub‐surface of the earth. Water and/or
steam carry the geothermal energy to the surface. Depending on its characteristics,
geothermal energy can be used for heating and cooling purposes or be harnessed togenerate clean electricity if the temperature is adequate.

Heat (supply): Obtained from the combustion of fuels, nuclear reactors, geothermal
resources or the capture of sunlight. It may be used for heating, cooling, or converted into
206

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Heat (end-use): Can be obtained from the combustion of fossil or renewable fuels, direct
geothermal or solar heat systems, exothermic chemical processes and electricity (throughresistance heating or heat pumps which can extract it from ambient air and liquids). This
category refers to the wide range of end-uses, including space and water heating, andcooking in buildings, desalination and process applications in industry. It does not include
cooling applications.

mechanical energy for transport or electricity generation. Commercial heat sold is reported
under total final consumption with the fuel inputs allocated under power generation.
Heavy trucks: Include commercial vehicles: medium freight trucks (gross vehicle weight
between 3.5 and 15 tonnes); and heavy freight trucks (>15 tonnes).
Hydrogen: Hydrogen is used as a raw material in industry and refining, in the energy system
as an energy carrier or is combined with other inputs to produce hydrogen‐based fuels.
Unless otherwise stated, hydrogen in this report refers to low‐emissions hydrogen.
Hydrogen-based fuels: See low‐emissions hydrogen‐based fuels.
Hydropower: Energy content of the electricity produced in hydropower plants, assuming
100% efficiency. It excludes output from pumped storage and marine (tidal and wave) plants.
Improved cook stoves: Intermediate and advanced improved biomass cook stoves (ISOtier >2). It excludes basic improved cook stoves (ISO tier 0-2).
Industry: The sector includes fuel used within the manufacturing and construction industries.
Key industry branches include iron and steel, chemical and petrochemical, cement,
aluminium, and pulp and paper. Use by industries for the transformation of energy intoanother form or for the production of fuels is excluded and reported separately under otherenergy sector. There is an exception for fuel transformation in blast furnaces and coke ovens,which are reported within iron and steel. Consumption of fuels for the transport of goods isreported as part of the transport sector, while consumption by off‐road vehicles is reported
under industry.
International aviation bunkers: Includes the deliveries of aviation fuels to aircraft forinternational aviation. Fuels used by airlines for their road vehicles are excluded. The
domestic/international split is determined on the basis of departure and landing locations
and not by the nationality of the airline. For many countries this incorrectly excludes fuels
used by domestically owned carriers for their international departures.

Investment: Investment is the capital expenditure in energy supply, infrastructure, end‐use
and efficiency. Fuel supply investment includes the production, transformation and transportof oil, gas, coal and low‐emissions fuels. Power sector investment includes new construction
and refurbishment of generation, electricity grids (transmission, distribution and public
electric vehicle chargers) and battery storage. Energy efficiency investment includes
efficiency improvements in buildings, industry and transport. Other end‐use investment
Annex B | Definitions

207

IEA. CC BY 4.0.

International marine bunkers: Includes the quantities delivered to ships of all flags that are
engaged in international navigation. The international navigation may take place at sea, on
inland lakes and waterways, and in coastal waters. Consumption by ships engaged indomestic navigation is excluded. The domestic/international split is determined on the basisof port of departure and port of arrival, and not by the flag or nationality of the ship.
Consumption by fishing vessels and by military forces is excluded and instead included in theresidential, services and agriculture category.

Bincludes the purchase of equipment for the direct use of renewables, electric vehicles,
electrification in buildings, industry and international marine transport, equipment for theuse of low‐emissions fuels, and CCUS in industry and direct air capture. Data and projections
reflect spending over the lifetime of projects and are presented in real terms in year‐2022
US dollars converted at market exchange rates unless otherwise stated. Total investment
reported for a year reflects the amount spent in that year.
Light-duty vehicles (LDVs): Include passenger cars and light commercial vehicles (grossvehicle weight <3.5 tonnes).
Liquid biofuels: Include liquid fuels derived from biomass or waste feedstock, e.g. ethanol,
biodiesel and biojet fuels. They can be classified as conventional and advanced biofuelsaccording to the combination of feedstock and technologies used to produce them and theirrespective maturity. Unless otherwise stated, biofuels are expressed in energy‐equivalent
volumes of gasoline, diesel and kerosene.
Liquid fuels: Include oil, liquid biofuels (expressed in energy‐equivalent volumes of gasoline
and diesel), synthetic oil and ammonia.
Low-emissions electricity: Includes renewable energy technologies, low‐emissionshydrogen‐based generation, low‐emissions hydrogen‐based fuel generation, nuclear power
and fossil fuel power plants equipped with carbon capture, utilisation and storage.
Low-emissions fuels: Include modern bioenergy, low‐emissions hydrogen and low‐emissionshydrogen‐based fuels.
Low-emissions hydrogen: Hydrogen which is produced through water electrolysis withelectricity generated from a low-emissions source such as renewables or nuclear, or biomass
or from fossil fuels equipped with CCUS technology. Production from fossil fuels with CCUS
is included only if upstream emissions are sufficiently low, if capture, at high rates, is applied
to all CO2 streams associated with the production route, and if all CO2 is permanently stored
to prevent its release to the atmosphere.

Low-emissions material production: Production that achieves substantial emissions
reductions but falls short of achieving near zero emissions. The IEA has proposed greenhousegas emissions intensity thresholds and a continuous scale of evaluation for low-emissions
production, with the quantity being proportional to the reduction in emissions intensity
achieved for steel and cement in the Achieving Net Zero Heavy Industry Sectors in G7
Members (IEA, 2022). The thresholds depend on the scrap share of metallics input for steel
and the clinker-to-cement ratio for cement. For other energy-intensive commodities such asaluminium, fertilisers and plastics, reductions in emissions intensity and the continuous scaleevaluation would be equivalent to the considerations for low-emissions steel and cement.
208

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Low-emissions hydrogen-based fuels: Include ammonia and synthetic hydrocarbons
produced from low-emissions hydrogen. In the case of synthetic hydrocarbons, they are
produced from low-emissions hydrogen and a sustainable carbon source (of biogenic origin
or directly captured from the atmosphere).

Marine energy: Represents the mechanical energy derived from tidal movement, wave
motion or ocean current and exploited for electricity generation.
Mini-grids: Small grid systems linking a number of households or other consumers.
Modern bioenergy and renewable waste: Refers to bioenergy excluding traditional use of
biomass and renewable waste.
Modern energy access: Includes household access to a minimum level of electricity;
household access to safer and more sustainable cooking and heating fuels, and clean cooking
stoves; access that enables productive economic activity; and access for public services.
Modern liquid bioenergy: Includes biogasoline, biodiesel, biojet kerosene and other liquidbiofuels.
Modern renewables: Includes all uses of renewable energy with the exception of traditionaluse of solid biomass.
Modern solid bioenergy: Includes all solid bioenergy products (see solid bioenergy
definition) except the traditional use of biomass. It also includes the use of solid bioenergy
in intermediate and advanced improved biomass cook stoves (ISO tier ≥ 3) requiring fuel tobe cut in small pieces or often using processed biomass such as pellets.
Natural gas: Includes gas occurring in deposits, whether liquefied or gaseous, consisting
mainly of methane. It includes both non‐associated gases originating from fields producing
hydrocarbons only in gaseous form, and associated gas produced in association with crude
oil production as well as methane recovered from coal mines (colliery gas). Natural gas
liquids, manufactured gas (produced from municipal or industrial waste, or sewage) andquantities vented or flared are not included. Gas data in cubic metres are expressed on agross calorific value basis and are measured at 15 °C and at 760 mm Hg (Standard
Conditions). Gas data expressed in tonnes of oil equivalent, mainly for comparison reasons
with other fuels, are on a net calorific basis. The difference between the net and the grosscalorific value is the latent heat of vaporisation of the water vapour produced during
combustion of the fuel (for gas the net calorific value is 10% lower than the gross calorificvalue).

Near zero emission material production: for steel and cement, production that achieves thenear zero emission GHG emissions intensity thresholds defined in the IEA’s ‘Achieving Net
Zero Heavy Industry Sectors in G7 Members’ (2022); the thresholds depend on the scrap
share of metallics input for steel and the clinker-to-cement ratio for cement. For otherenergy-intensive commodities like aluminium, fertilisers and plastics, production that
Annex B | Definitions

209

IEA. CC BY 4.0.

Near zero emission capable material production capacity: capacity that will achieve
substantial emissions reductions from the start – but fall short of near zero emission material
production (see following definition) initially – with plans to continue reducing emissions
over time such that they could later achieve near zero emission production without
additional capital investment.

Bachieves reductions in emissions intensity equivalent to the considerations for near zero
emission steel and cement.
Near zero emission material production capacity: capacity that, once operational, willachieve near zero emission material production (see preceding definition) from the start.
Network gases: Includes natural gas, biomethane, synthetic methane and hydrogen blended
in a gas network.
Non-energy use: The use of fuels as feedstocks for chemical products that are not used inenergy applications. Examples of resulting products are lubricants, paraffin waxes, asphalt,
bitumen, coal tars and timber preservative oils.
Nuclear: Refers to the primary energy equivalent of the electricity produced by a nuclear
power plant, assuming an average conversion efficiency of 33%.
Off-grid systems: Mini‐grids and stand‐alone systems for individual households or groups ofconsumers not connected to a main grid.
Offshore wind: Refers to electricity produced by wind turbines that are installed in open
water, usually in the ocean.
Oil: Oil production includes both conventional and unconventional oil. Petroleum products
include refinery gas, ethane, liquid petroleum gas, aviation gasoline, motor gasoline, jet
fuels, kerosene, gas/diesel oil, heavy fuel oil, naphtha, white spirit, lubricants, bitumen,paraffin, waxes and petroleum coke.
Other energy sector: Covers the use of energy by transformation industries and the energy
losses in converting primary energy into a form that can be used in the final consuming
sectors. It includes losses in low‐emissions hydrogen and hydrogen‐based fuels production,
bioenergy processing, gas works, petroleum refineries, coal and gas transformation andliquefaction. It also includes energy own use in coal mines, in oil and gas extraction and inelectricity and heat production. Transfers and statistical differences are also included in thiscategory. Fuel transformation in blast furnaces and coke ovens are not accounted for in theother energy sector category.
Power generation: Refers to fuel use in electricity generation plants, heat plants, andcombined heat and power plants. Both main activity producer plants and small plants that
produce fuel for their own use (auto‐producers) are included.
Productive uses: Energy used towards an economic purpose: agriculture, industry, services
and non‐energy use. Some energy demand from the transport sector, for example freight,
could be considered as productive, but is treated separately.

210

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Renewables: Includes bioenergy, renewable waste, geothermal, hydropower, solar
photovoltaics (PV), concentrating solar power (CSP), wind and marine (tide and wave) energy
for electricity and heat generation.

Residential: Energy used by households including space heating and cooling, water heating,lighting, appliances, electronic devices and cooking.
Road transport: Includes all road vehicle types (passenger cars, two/three-wheelers. Light
commercial vehicles, buses and medium and heavy trucks).
Services: Energy used in commercial facilities such as offices, shops, hotels, and restaurants,
and in institutional buildings such as schools, hospitals and public offices. Energy use inservices includes space heating and cooling, water heating, lighting, appliances, cooking anddesalination.
Shipping/navigation: This transport sub-sector includes both domestic and internationalnavigation and their use of marine fuels. Domestic navigation covers the transport of goods
or persons on inland waterways and for national sea voyages (starts and ends in the same
country without any intermediate foreign port). International navigation includes quantities
of fuels delivered to merchant ships (including passenger ships) of any nationality for
consumption during international voyages transporting goods or passengers.
Solar photovoltaics (PV): Electricity produced from solar photovoltaic cells.
Solid bioenergy: Includes charcoal, fuelwood, dung, agricultural residues, wood waste andother solid biogenic wastes.
Steam coal: A type of coal that is mainly used for heat production or steam‐raising in power
plants and, to a lesser extent, in industry. Typically, steam coal is not of sufficient quality forsteel making. Coal of this quality is also commonly known as thermal coal.
Synthetic fuel: Includes synthetic hydrocarbon fuels such as methane and oil products, e.g.
diesel or kerosene.
Synthetic methane: Methane from sources other than natural gas, including coal‐to‐gas andlow‐emissions synthetic methane.
Total energy supply (TES): Represents domestic demand only and is broken down into
electricity and heat generation, other energy sector and total final consumption.

Total final energy consumption (TFEC): Is a variable defined primarily for tracking progress
towards target 7.2 of the United Nations Sustainable Development Goals (SDG). It
incorporates total final consumption by end‐use sectors, but excludes non‐energy use. It
excludes international marine and aviation bunkers, except at world level. Typically, this isused in the context of calculating the renewable energy share in total final energy
consumption (indicator SDG 7.2.1), where TFEC is the denominator.
Annex B | Definitions

211

IEA. CC BY 4.0.

Total final consumption (TFC): Is the sum of consumption by the various end‐use sectors.
TFC is broken down into energy demand in the following sectors: industry (including
manufacturing, mining, chemicals production, blast furnaces and coke ovens), transport,
buildings (including residential and services) and other (including agriculture and other non‐energy use). It excludes international marine and aviation bunkers, except at world level
where it is included in the transport sector.

BTotal primary energy demand (TPED): See total energy supply.
Traditional use of biomass: Refers to the use of solid biomass with basic technologies, suchas a three‐stone fire or basic cook stoves (ISO tier 0‐2), often with no or poorly operating
chimneys. Forms of biomass used include wood, wood waste, charcoal agricultural residues
and other bio‐sourced fuels such as animal dung.
Transport: Fuels and electricity used in the transport of goods or people within the national
territory irrespective of the economic sector within which the activity occurs. This includes
fuel and electricity delivered to vehicles using public roads or for use in rail vehicles; fueldelivered to vessels for domestic navigation; fuel delivered to aircraft for domestic aviation;and energy consumed in the delivery of fuels through pipelines. Fuel delivered tointernational marine and aviation bunkers is presented only at the world level and is
excluded from the transport sector at a domestic level.
Trucks: Includes all size categories of commercial vehicles: light trucks (gross vehicle weightless than 3.5 tonnes); medium freight trucks (gross vehicle weight 3.5‐15 tonnes); and heavy
freight trucks (>15 tonnes).
Unabated fossil fuel use: Combustion of fossil fuels in facilities without CCUS.
Useful energy: Refers to the energy that is available to end‐users to satisfy their needs. Thisis also referred to as energy services demand. As result of transformation losses at the pointof use, the amount of useful energy is lower than the corresponding final energy demand formost technologies. Equipment using electricity often has higher conversion efficiency thanequipment using other fuels, meaning that for a unit of energy consumed, electricity canprovide more energy services.
Wind: Electricity produced by wind turbines from the kinetic energy of wind.
Woody energy crops: Short-rotation plantings of woody biomass for bioenergy production,such as coppiced willow and miscanthus.
Vans: Includes commercial vehicles and light trucks (gross vehicle weight >3.5 tonnes).
Variable renewable energy (VRE): Refers to power generating technologies in which
maximum output at any time depends on the availability of fluctuating renewable energy
resources. VRE includes a broad array of technologies such as wind power, solar PV, run-ofriver hydro, concentrating solar power (where no thermal storage is included) and marine(tidal and wave).

212

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Zero-carbon-ready buildings: A zero-carbon-ready building is highly energy efficient andeither uses renewable energy directly, or an energy supply that can be fully decarbonised,such as electricity or district heat.

Regional and country groupings
Advanced economies: OECD regional grouping and Bulgaria, Croatia, Cyprus1,2, Malta andRomania.
Africa: North Africa and sub-Saharan Africa regional groupings.
Asia Pacific: Southeast Asia regional grouping and Australia, Bangladesh, China, India, Japan,
Korea, Democratic People’s Republic of Korea, Mongolia, Nepal, New Zealand, Pakistan, Sri
Lanka, Chinese Taipei, and other Asia Pacific countries and territories.3
Caspian: Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan andUzbekistan.
Central and South America: Argentina, Plurinational State of Bolivia (Bolivia), Brazil, Chile,
Colombia, Costa Rica, Cuba, Curaçao, Dominican Republic, Ecuador, El Salvador, Guatemala,
Guyana, Haiti, Honduras, Jamaica, Nicaragua, Panama, Paraguay, Peru, Suriname, Trinidad
and Tobago, Uruguay, Bolivarian Republic of Venezuela (Venezuela), and other Central andSouth American countries and territories.4
China: Includes (the People's Republic of) China and Hong Kong, China.
Developing Asia: Asia Pacific regional grouping excluding Australia, Japan, Korea and
New Zealand.
Emerging market and developing economies: All other countries not included in theadvanced economies regional grouping.
Figure C.1 ⊳Main country groupings

Annex B | Definitions

213

IEA. CC BY 4.0.

Note: This map is without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries
and to the name of any territory, city or area.

BEurasia: Caspian regional grouping and the Russian Federation (Russia).
Europe: European Union regional grouping and Albania, Belarus, Bosnia and Herzegovina,
North Macedonia, Gibraltar, Iceland, Israel5, Kosovo, Montenegro, Norway, Republic ofMoldova, Serbia, Switzerland, Türkiye, Ukraine and United Kingdom.
European Union: Austria, Belgium, Bulgaria, Croatia, Cyprus1,2, Czech Republic, Denmark,Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania,
Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovak Republic, Slovenia,
Spain and Sweden.
IEA (International Energy Agency): OECD regional grouping excluding Chile, Colombia, Costa
Rica, Iceland, Israel, Latvia, and Slovenia.
Latin America and the Caribbean: Central and South America regional grouping and Mexico.
Middle East: Bahrain, Islamic Republic of Iran (Iran), Iraq, Jordan, Kuwait, Lebanon, Oman,
Qatar, Saudi Arabia, Syrian Arab Republic (Syria), United Arab Emirates and Yemen.
Non-OECD: All other countries not included in the OECD regional grouping.
Non-OPEC: All other countries not included in the OPEC regional grouping.
North Africa: Algeria, Egypt, Libya, Morocco and Tunisia.
North America: Canada, Mexico and United States.
OECD (Organisation for Economic Co-operation and Development): Australia, Austria,
Belgium, Canada, Chile, Colombia, Costa Rica, Czech Republic, Denmark, Estonia, Finland,
France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Latvia,
Lithuania, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal,
Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Türkiye, United Kingdom and UnitedStates.
OPEC (Organisation of the Petroleum Exporting Countries): Algeria, Angola, Republic of theCongo (Congo), Equatorial Guinea, Gabon, the Islamic Republic of Iran (Iran), Iraq, Kuwait,
Libya, Nigeria, Saudi Arabia, United Arab Emirates and Bolivarian Republic of Venezuela(Venezuela).
Southeast Asia: Brunei Darussalam, Cambodia, Indonesia, Lao People’s Democratic Republic(Lao PDR), Malaysia, Myanmar, Philippines, Singapore, Thailand and Viet Nam. These
countries are all members of the Association of Southeast Asian Nations (ASEAN).

214

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Sub-Saharan Africa: Angola, Benin, Botswana, Cameroon, Republic of the Congo (Congo),
Côte d’Ivoire, Democratic Republic of the Congo, Equatorial Guinea, Eritrea, Ethiopia, Gabon,
Ghana, Kenya, Kingdom of Eswatini, Madagascar, Mauritius, Mozambique, Namibia, Niger,
Nigeria, Rwanda, Senegal, South Africa, South Sudan, Sudan, United Republic of Tanzania(Tanzania), Togo, Uganda, Zambia, Zimbabwe and other African countries and territories.6

Country notes
1 Note by Republic of Türkiye: The information in this document with reference to “Cyprus” relates to thesouthern part of the island. There is no single authority representing both Turkish and Greek Cypriot people
on the island. Türkiye recognises the Turkish Republic of Northern Cyprus (TRNC). Until a lasting and equitable
solution is found within the context of the United Nations, Turkey shall preserve its position concerning the“Cyprus issue”.
2 Note by all the European Union Member States of the OECD and the European Union: The Republic of Cyprus

is recognised by all members of the United Nations with the exception of Türkiye. The information in thisdocument relates to the area under the effective control of the Government of the Republic of Cyprus.

3 Individual data are not available and are estimated in aggregate for: Afghanistan, Bhutan, Cook Islands, Fiji,

French Polynesia, Kiribati, Macau (China), Maldives, New Caledonia, Palau, Papua New Guinea, Samoa,
Solomon Islands, Timor-Leste and Tonga and Vanuatu.

4 Individual data are not available and are estimated in aggregate for: Anguilla, Antigua and Barbuda, Aruba,

Bahamas, Barbados, Belize, Bermuda, Bonaire, Sint Eustatius and Saba, British Virgin Islands, Cayman Islands,
Dominica, Falkland Islands (Malvinas), Grenada, Montserrat, Saint Kitts and Nevis, Saint Lucia, Saint Pierre andMiquelon, Saint Vincent and the Grenadines, Sint Maarten (Dutch part), Turks and Caicos Islands.
The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities.
The use of such data by the OECD and/or the IEA is without prejudice to the status of the Golan Heights, East
Jerusalem and Israeli settlements in the West Bank under the terms of international law.

5

6
Individual data are not available and are estimated in aggregate for: Burkina Faso, Burundi, Cabo Verde,Central African Republic, Chad, Comoros, Djibouti, Gambia, Guinea, Guinea-Bissau, Lesotho, Liberia, Malawi,
Mali, Mauritania, Sao Tome and Principe, Seychelles, Sierra Leone and Somalia.

AC
AFOLU
APS
BECCS
CCUS
CDR
CH4
CO2
CO2-eq
COP
CSP
DAC
DC
DER
DSI
DSR
EAF
EMDE
EU
EV
FID
GDP

alternating current
agriculture, forestry and other land use
Announced Pledges Scenario
bioenergy equipped with CCUS
carbon capture, utilisation and storage
carbon dioxide removal
methanecarbon dioxidecarbon-dioxide equivalent
Conference of Parties (UNFCCC)
concentrating solar power
direct air capture
direct current
distributed energy resourcesdemand-side integration
demand-side responseelectric arc furnaces
emerging market and developing economies
European Union
electric vehicle
final investment decisiongross domestic productAnnex B | Definitions

215

IEA. CC BY 4.0.

Abbreviations and acronyms

BSTEPS
T&D
TES
TFC
TFEC
TPED
UN
UNDP
UNEP
UNFCCC
UK
US
VRE
WACC
WEO
WHO

216

greenhouse gases
internal combustion engine
International Energy Agency
International Institute for Applied Systems Analysis
International Monetary FundIntergovernmental Panel on Climate Changelight-duty vehicles
light-emitting diodeliquefied natural gas
liquefied petroleum gas
market exchange rate
Nationally Determined Contributions
nitrogen oxides
nitrous oxide
Net Zero Emissions by 2050 Scenario
Organisation for Economic Co-operation and Development
Organization of the Petroleum Exporting Countries
purchasing power parity
photovoltaics
research and development
research, development and demonstration
sustainable aviation fuelSustainable Development Goals (United Nations)
IPCC Special Report on the impacts of global warming of 1.5 °C
above pre-industrial levels
Stated Policies Scenariotransmission and distribution
total energy supply
total final consumption
total final energy consumption
total primary energy demand
United Nations
UN Development Programme
UN Environment Programme
UN Framework Convention on Climate Change
United Kingdom
United States
variable renewable energy
weighted average cost of capital
World Energy Outlook
World Health Organization

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

GHG
ICE
IEA
IIASA
IMF
IPCC
LDVs
LED
LNG
LPG
MER
NDCs
NOX
N2O
NZE
OECD
OPEC
PPP
PV
R&D
RD&D
SAF
SDG
SR1.5

Annex C
References
Chapter 1: Overview and key findings
Abernathy, W., & Wayne, K. (1974). Limits of the learning curve.
https://hbr.org/1974/09/limits-of-the-learning-curve
BNEF (Bloomberg New Energy Finance). (2023). Lithium-Ion Batteries: State of the Industry
2023. Accessed August 2023.
BNEF. (2022). Lithium-Ion Batteries: State of the Industry 2022. Accessed June 2023.
Grubler, A., Nakicenovic, N., & Victor, D. (1999). Dynamics of energy technologies andglobal change. https://doi.org/10.1016/S0301-4215(98)00067-6
IEA (International Energy Agency). (2023a). Tracking Clean Energy Progress.
https://www.iea.org/reports/tracking-clean-energy-progress-2023
IEA. (2023b). CCUS Projects Database. Accessed July 2023.
https://www.iea.org/data-and-statistics/data-product/ccus-projects-database
IEA. (2023c). Energy Technology Perspectives.
https://www.iea.org/reports/energy-technology-perspectives-2023
IEA. (2023d). The State of Clean Technology Manufacturing: An Energy Technology
Perspectives Special Briefing.
https://www.iea.org/reports/the-state-of-clean-technology-manufacturing
IEA. (2023e). Global Hydrogen Review 2023.
https://www.iea.org/reports/global-hydrogen-review-2023
IEA. (2023f). Critical Minerals Market Review 2023.
https://www.iea.org/reports/critical-minerals-market-review-2023
IEA. (2023g). World Energy Investment 2023.
https://www.iea.org/reports/world-energy-investment-2023
IEA. (2023h). Global Electric Vehicle Outlook.
https://www.iea.org/reports/global-ev-outlook-2023
IEA. (2023i). Hydrogen Patents for a Clean Energy Future.
https://www.iea.org/reports/hydrogen-patents-for-a-clean-energy-future
IEA. (2022a). World Energy Outlook 2022.
https://www.iea.org/reports/world-energy-outlook-2022

IEA. (2021a). Net Zero by 2050: A Roadmap for the Global Energy Sector.
https://www.iea.org/reports/net-zero-by-2050

Annex C | References

217

IEA. CC BY 4.0.

IEA. (2022b). Special Report on Solar PV Global Supply Chains.
https://www.iea.org/reports/solar-pv-global-supply-chains

IEA. (2021b). World Energy Outlook 2021.
https://www.iea.org/reports/world-energy-outlook-2021
IEA. (2021c). Patents and the Energy Transition.
https://www.iea.org/reports/patents-and-the-energy-transition
IEA. (2020a). Energy Technology Perspectives 2020.
https://www.iea.org/reports/energy-technology-perspectives-2020
IEA. (2020b). Innovation in Batteries and Electricity Storage.
https://www.iea.org/reports/innovation-in-batteries-and-electricity-storage
Kavlak, G., McNerney, J., & Trancik, J. E. (2018). Evaluating the causes of cost reduction inphotovoltaic modules. Energy Policy, pp. 700-710.
https://doi.org/10.1016/j.enpol.2018.08.015
Lafond, F., Greenwald, D., & Farmer, J. (2022). Can stimulating demand drive costs down?
World War II as a Natural Experiment. https://doi.org/10.3886/E170901V1
McCallum J. (2023). Cost of memory with time. https://jcmit.net/memoryprice.htm
PV InfoLink. (2022). InfoLink online database. Accessed June 2023.
https://www.infolink-group.com/en/
RTS. (2021). Research on Solar PV Manufacturing Equipment and Systems.
https://www.rts-pv.com/en/ [in Japanese].
SPV Market Research. (2022). Photovoltaic Manufacturer Capacity, Shipments, Price &Revenues 2021/2022 and data received from SPV Market Research.
https://www.spvmarketresearch.com/
VDMA. (2023). International Technology Roadmap for Photovoltaic (ITRPV) 2022 Results.
https://www.vdma.org/international-technology-roadmap-photovoltaic
VDMA. (2021). International Technology Roadmap for Photovoltaic (ITRPV) 2020 Results.
https://www.vdma.org/international-technology-roadmap-photovoltaic
Zeitlin, J. (1995), Flexibility and mass production at war: Aircraft manufacture in Britain, theUnited States, and Germany, 1939-1945. https://doi.org/10.2307/3106341

Chapter 2: A renewed pathway to net zero emissions
Berkeley Earth. (2023). July 2023 Temperature Update.
https://berkeleyearth.org/july-2023-temperature-update/

IEA (International Energy Agency). (2022a). Coal in Net Zero Transitions.
https://www.iea.org/reports/coal-in-net-zero-transitions

218

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

Carbon Brief. (2023). State of the Climate: 2023 Now Likely Hottest Year on Record After
Extreme Summer. https://www.carbonbrief.org/state-of-the-climate-2023-now-likelyhottest-year-on-record-after-extreme-summer/

IEA. (2022b). Nuclear Power in Secure Energy Transitions.
https://www.iea.org/reports/nuclear-power-and-secure-energy-transitions
IEA. (2022c). Achieving Net Zero Heavy Industry Sectors in G7 Members.
https://www.iea.org/reports/achieving-net-zero-heavy-industry-sectors-in-g7-members
IEA. (2021a). Net Zero by 2050: A Roadmap for the Global Energy Sector.
https://www.iea.org/reports/net-zero-by-2050
IEA. (2021b). A closer look at the modelling behind our global Roadmap to Net Zero
Emissions by 2050. https://www.iea.org/commentaries/a-closer-look-at-the-modellingbehind-our-global-roadmap-to-net-zero-emissions-by-2050
IPCC (Intergovernmental Panel on Climate Change). (2023). Climate Change 2023 Synthesis
Report Summary for Policymakers.
https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf
IPCC. (2021). Climate Change 2021: Climate Change 202: The Physical Science Basis,
Contribution of Working Group 1 to the Sixth Assessment Report of the IPCC.
https://www.ipcc.ch/report/ar6/wg1/
IPCC. (2018). Global Warming of 1.5 °C. https://www.ipcc.ch/sr15/download/#full
MacDougall, A. et al. (2020). Is there warming in the pipeline? A multi-model analysis of theZero Emissions Commitment from CO2. https://bg.copernicus.org/articles/17/2987/2020/
UN DESA (United Nations Department of Economics and Social Affairs). (2022). World
population projected to reach 9.8 billion in 2050, and 11.2 billion in 2100.
https://www.un.org/en/desa/world-population-projected-reach-98-billion-2050-and-112billion-2100

Chapter 3: Making the NZE Scenario a reality
Aversen, A. et al. (2018). Deriving life cycle assessment coefficients for application in
integrated assessment modelling. Environmental Modelling & Software, 111-125.
https://doi.org/10.1016/j.envsoft.2017.09.010
Creutzig, F. (2015). Bioenergy and climate change mitigation: an assessment.
GCB Bioenergy. https://doi.org/10.1111/gcbb.12205
Enevoldsen, P. and Jacobson, M. (2021). Data investigation of installed and output power
densities of onshore and offshore wind turbines worldwide. Energy for Sustainable
Development, 40-51. https://doi.org/10.1016/j.esd.2020.11.004

European Commission. (2021). European Union Transaction Log (EUTL).
https://ec.europa.eu/clima/ets/welcome.do
Annex C | References

219

IEA. CC BY 4.0.

European Parliament. (2023). Amendments adopted by the European Parliament on
14 March 2023 on the proposal for a directive of the European Parliament and of theCouncil on the energy performance of buildings (recast).
https://www.europarl.europa.eu/doceo/document/TA-9-2023-0068_EN.html

CEuropean Commission. (2019). Comprehensive study of building energy renovation
activities and the uptake of nearly zero-energy buildings in the EU.
https://op.europa.eu/en/publication-detail/-/publication/97d6a4ca-5847-11ea-8b8101aa75ed71a1/language-en/format-PDF/source-119528141
FAO (Food and Agriculture Organisation of the United Nations). (n.d.). FAOSTAT database.
Accessed September 2023. https://www.fao.org/faostat/en/
Frank, S. (2021). Land-based climate change mitigation potentials within the agenda forsustainable development. Environmental Research Letters, 16/2.
https://doi.org/10.1088/1748-9326/abc58a
Global Cement. (2022). Global Cement Directory. https://www.globalcement.com/directory
Global Energy Monitor. (2022). Global Steel Plant Tracker (database). Accessed September
2022. https://globalenergymonitor.org/projects/global‐steel‐plant‐tracker/
Hirth, L. et al. (2022). Gas demand in times of crisis: energy savings by consumer group in
Germany. https://www.econstor.eu/handle/10419/266725
IEA (International Energy Agency). (forthcoming). Electricity Grids and Secure Energy
Transitions.
IEA. (2023a). Cost of Capital Observatory.
https://www.iea.org/reports/cost-of-capital-observatory
IEA. (2023b). Behavioural Changes.
https://www.iea.org/energy-system/energy-efficiency-and-demand/behavioural-changes
IEA. (2023c). Clean Cooking Report.
https://www.iea.org/reports/a-vision-for-clean-cooking-access-for-all
IEA. (2023d). Global heat pump sales continue double-digit growth.
https://www.iea.org/commentaries/global-heat-pump-sales-continue-double-digit-growth.
IEA. (2023e). IEA Clean Technology Guide.
https://www.iea.org/data-and-statistics/data-tools/etp-clean-energy-technology-guide
IEA. (2023f). Credible pathways to 1.5 °C: Four pillars for action in the 2020s.
https://www.iea.org/reports/credible-pathways-to-150c
IEA. (2023g). Financing Reductions in Oil and Gas Methane Emissions.
https://www.iea.org/reports/financing-reductions-in-oil-and-gas-methane-emissions
IEA. (2023h). CCUS Projects Database. Accessed August 2023.
https://www.iea.org/data-and-statistics/data-product/ccus-projects-database

IEA. (2023j). Global hydrogen review 2023.
https://www.iea.org/reports/global-hydrogen-review-2023
220

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

IEA. (2023i). Towards hydrogen definitions based on their emissions intensity.
https://www.iea.org/reports/towards-hydrogen-definitions-based-on-their-emissionsintensity

IEA. (2021a). Achievements of Energy Efficiency Appliance and Equipment Standards andLabelling Programmes. https://www.iea.org/reports/achievements-of-energy-efficiencyappliance-and-equipment-standards-and-labelling-programmes
IEA. (2021b). Net Zero by 2050: A Roadmap for the Global Energy Sector.
https://www.iea.org/reports/net-zero-by-2050
IPCC (Intergovernmental Panel on Climate Change). (2023). Climate Change 2023: Synthesis
Report. https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf
IPCC. (2019). Climate change and land: An IPCC Special Report on climate change,
desertification, land degradation, sustainable land management, food security, andgreenhouse gas fluxes in terrestrial ecosystems. https://www.ipcc.ch/srccl/
IPCC. (2014). AR5 Synthesis Report: Climate Change 2014.
https://www.ipcc.ch/report/ar5/syr/Kearns, J. (2017). Developing a Consistent Database for Regional Geologic CO2 Storage
Capacity Worldwide. Energy Procedia, 114, 4697-4709.
https://doi.org/10.1016/j.egypro.2017.03.1603
Lovering, J. et al. (2022). Land-use intensity of electricity production and tomorrow's energy
landscape. PLOS ONE. https://doi.org/10.1371/journal.pone.0270155
Meyer, A. L., et al. (2022). Risks to biodiversity from temperature overshoot pathways.
https://royalsocietypublishing.org/doi/10.1098/rstb.2021.0394
NREL (National Renewable Energy Laboratory). (2021). The Renewable Energy Potential(reV) Model: A Geospatial Platform for Technical Potential and Supply Curve Modelling.
https://www.nrel.gov/docs/fy19osti/73067.pdf
Olgyay, V. (2010). Whole-Building Retrofits: A Gateway to Climate Stabilization.
https://www.researchgate.net/publication/268188261_Whole-Building_Retrofits_A_
Gateway_to_Climate_Stabilization
Parker, K., Horowitz, J. M., & Minkin, R. (2022). COVID-19 Pandemic Continues To Reshape
Work in America. https://www.pewresearch.org/social-trends/2022/02/16/covid-19pandemic-continues-to-reshape-work-in-america/
Smil, V. (2010). Power Density Primer: Understanding the Spatial Dimension of the
Unfolding Transition to Renewable Electricity Generation (Part I–Definitions).
http://www.vaclavsmil.com/wp-content/uploads/docs/smil-article-power-densityprimer.pdf

Transport for London. (2023). Congestion Charge marks 20 years of keeping London moving
sustainably. https://tfl.gov.uk/info-for/media/press-releases/2023/february/congestioncharge-marks-20-years-of-keeping-london-moving-sustainably
Annex C | References

221

IEA. CC BY 4.0.

S&P Global. (2022). World Electric Power Plants (database). Accessed March 2022.
www.spglobal.com/marketintelligenceCUNECE (United Nations Economic Commission for Europe). (2022). Carbon Neutrality in the
UNECE Region: Integrated life Cycle Assessment of Electricity Generation Options.
https://www.un-ilibrary.org/content/books/9789210014854
US EIA (Energy Information Administration). (2018). Commercial Buildings Energy
Consumption Survey (CBECS). https://www.eia.gov/consumption/commercial/
US Environmental Protection Agency Office of Astmospheric Protection. (2021).
Greenhouse Gas Reporting Program (GHGRP). Accessed June 2023.
www.epa.gov/ghgreportingWu, W. H. (2019). Global advanced bioenergy potential under environmental protection
policies and societal transformation measures. GCB Bioenergy.
https://doi.org/10.1111/gcbb.12614
Wunderling, N., et al. (2022). Global warming overshoots increase risk of triggering climate
tipping points and cascades. https://europepmc.org/article/ppr/ppr484821
ZEBRA. (2020). Energy efficiency trends in buildings. https://zebramonitoring.enerdata.net/overall-building-activities/equivalent-major-renovation-rate.html

Chapter 4: Secure, equitable and co-operative transitionsFirst Movers Coalition. (2022). Steel commitment.
https://www.weforum.org/first-movers-coalition/sectors
Frontier. (2022). Frontier facilitates first carbon removal purchases.
https://frontierclimate.com/writing/spring-2022-purchases
G7 Ministers of Climate. (2023). G7 Climate, Energy and Environment Ministers’Communiqué. https://www.meti.go.jp/press/2023/04/20230417004/20230417004-1.pdf
GSCC (Global Steel Climate Council). (2023). The Steel Climate Standard.
https://globalsteelclimatecouncil.org/the-standard/
IEA (International Energy Agency). (forthcoming a). World Energy Employment 2023
IEA. (forthcoming b). Electricity Grids and Secure Energy Transitions.
IEA. (2023a). Critical Minerals Market Review 2023.
https://www.iea.org/reports/critical-minerals-market-review-2023
IEA. (2023b). World Energy Investment 2023.
https://www.iea.org/reports/world-energy-investment-2023

IEA. (2023d). Towards hydrogen definitions based on their emissions intensity.
https://www.iea.org/reports/towards-hydrogen-definitions-based-on-their-emissionsintensity
222

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

IEA. (2023c). The global energy crisis pushed fossil fuel consumption subsidies to an all-timehigh in 2022. https://www.iea.org/commentaries/the-global-energy-crisis-pushed-fossilfuel-consumption-subsidies-to-an-all-time-high-in-2022

IEA. (2023e). Emissions Measurement and Data Collection for a Net Zero Steel Industry.
https://www.iea.org/reports/emissions-measurement-and-data-collection-for-a-net-zerosteel-industry
IEA. (2023f). The State of Clean Technology Manufacturing.
https://www.iea.org/reports/the-state-of-clean-technology-manufacturing
IEA. (2023g). Clean Energy Demonstration Projects Database. Accessed July 2023.
https://www.iea.org/data-and-statistics/data-tools/clean-energy-demonstration-projectsdatabase
IEA. (2022a). The world's top 1% of emitters produce over 1000 times more CO2 than thebottom 1%. https://www.iea.org/commentaries/the-world-s-top-1-of-emitters-produceover-1000-times-more-co2-than-the-bottom-1
IEA. (2022b). Coal in Net Zero Transitions.
https://www.iea.org/reports/coal-in-net-zero-transitions
IEA. (2022c). Achieving Net Zero Heavy Industry Sectors in G7 Members.
https://www.iea.org/reports/achieving-net-zero-heavy-industry-sectors-in-g7-members
IEA. (2021a). Net Zero Emissions by 2050: A Roadmap for the Global Energy Sector.
https://www.iea.org/reports/net-zero-by-2050
IEA. (2021b). Patents and the Energy Transition.
https://www.iea.org/reports/patents-and-the-energy-transition
IEA and IFC (International Energy Agency and International Finance Corporation). (2023).
Scaling Up Private Finance for Clean Energy in Emerging and Developing Economies.
https://www.iea.org/reports/scaling-up-private-finance-for-clean-energy-in-emerging-anddeveloping-economies
IRENA (International Renewable Energy Agency). (2023). The cost of financing forrenewable power. https://www.irena.org/Publications/2023/May/The-cost-of-financingfor-renewable-power
JATO. (2021). Electric Vehicles: A Pricing Challenge.
https://info.jato.com/electric-vehicles-a-pricing-challenge
Nepal, R. et al. (2018). Small systems, big targets: Power sector reforms and renewableenergy in small systems. Energy Policy, 19-29. https://doi.org/10.1016/j.enpol.2018.01.013

Pfeiffer, B. and Mulder, P. (2013). Explaining the diffusion of renewable energy technology
in developing countries. Energy Economics, 285-296.
https://doi.org/10.1016/j.eneco.2013.07.005
Annex C | References

223

IEA. CC BY 4.0.

OECD (Organisation for Economic Cooperation and Development). (2022). Climate Finance
Provided and Mobilised by Developed Countries in 2016-2020: Insights from DisaggregatedAnalysis. https://www.oecd.org/environment/climate-finance-provided-and-mobilised-bydeveloped-countries-in-2016-2020-286dae5d-en.htm

CResponsibleSteel. (2022). The ResponsibleSteel™ International Standard.
https://www.responsiblesteel.org/standard/South Pole. (2023). Hydrogen for Net Zero Initiative.
https://www.southpole.com/hydrogen-for-net-zero-initiative
SSAB. (2023). SSAB Fossil-free™ steel. https://www.ssab.com/en/fossil-free-steel#ffs
Suzuki, M. (2015). Identifying roles of international institutions in clean energy technology
innovation and diffusion in the developing countries. Journal of Cleaner Production,229-240. https://doi.org/10.1016/j.jclepro.2014.08.070
US Department of Energy. (2022). United States Announces $94 Billion Of Global Public
Funding To Accelerate Clean Energy Worldwide. https://www.energy.gov/articles/unitedstates-announces-94-billion-global-public-funding-accelerate-clean-energy-worldwide
World Inequality Database. (2022). Accessed June 2023. https://wid.world/
Zeng, S. et al. (2022). Modelling the influence of critical factors on the adoption of green
energy technologies. Renewable and Sustainable Energy Reviews.
https://doi.org/10.1016/j.rser.2022.112817

Annex B: Definitions

224

International Energy Agency | Net Zero Roadmap

IEA. CC BY 4.0.

IEA (International Energy Agency). (2022). Achieving Net Zero Heavy Industry Sectors in G7
Members. https://www.iea.org/reports/achieving-net-zero-heavy-industry-sectors-in-g7members

International Energy Agency (IEA)
This work reflects the views of the IEA Secretariat but does not necessarily reflect
those of the IEA’s individual Member countries or of any particular funder orcollaborator. The work does not constitute professional advice on any specific issue orsituation. The IEA makes no representation or warranty, express or implied, in respectof the work’s contents (including its completeness or accuracy) and shall not be
responsible for any use of, or reliance on, the work.

Subject to the IEA’s Notice for CC-licenced Content, this work is licenced under aCreative Commons Attribution 4.0 International Licence.
Annex A to Net Zero Emissions by 2050: A Roadmap for the Global Energy Sector –2023 Update is licensed under a Creative Commons Attribution-NonCommercialShareAlike 4.0 International Licence.
This document and any map included herein are without prejudice to the status ofor sovereignty over any territory, to the delimitation of international frontiers andboundaries and to the name of any territory, city or area.
Unless otherwise indicated, all material presented in figures and tables is derived
from IEA data and analysis.
IEA Publications
International Energy Agency
Website: www.iea.org
Contact information: www.iea.org/contact
Typeset in France by IEA - September 2023
Cover design: IEA
Photo credits: © Shutterstock

Net Zero Roadmap: A Global Pathway
to Keep the 1.5 °C Goal in Reach
2023 Update
In May 2021, the IEA published its landmark report
Net Zero Emissions by 2050: A Roadmap for the
Global Energy Sector. The report set out a narrow
but feasible pathway for the global energy sector tocontribute to the Paris Agreement’s goal of limiting
the rise in global temperatures to 1.5 °C above preindustrial levels. The Net Zero Roadmap quickly
became an important benchmark for policy makers,
industry, the financial sector and civil society.
Since the report was released, many changes havetaken place, notably amid the global energy crisis
triggered by Russia’s invasion of Ukraine in February
2022. And energy sector carbon dioxide emissions
have continued to rise, reaching a new record in
2022. Yet there are also increasing grounds for
optimism: the last two years have also seen
remarkable progress in developing and deploying
some key clean energy technologies.
This 2023 update to our Net Zero Roadmap surveys
this complex and dynamic landscape and sets out
an updated pathway to net zero by 2050, taking
account of the key developments that have occurredsince 2021.