That was correct but I was positively surprised to find more. After some analysis, the IEA report reveals much more than the press release and the executive summary showed.

In the first place, the report illustrates how a portfolio of low-carbon technologies can lead the world into a low-carbon economy. Our current path is very unsustainable, and the outlook has even deteriorated since the last version.

But most remarkably, I spotted a paragraph on page 229 of the report where the IEA mentions that 'fuel savings comfortably offset additional investment needs'. So the estimated total fuel cost savings of a low-carbon global economy are greater than the additional investment required! The figure illustrating this shows a profit of 5 trillion dollars in the period until 2050 for the most ambitious scenario.

I must admit, the IEA remark refers to a rather unrealistic scenario with a zero discount rate (say the interest of money), where discount rates of 5% or 10% may be more realistic. But then again, all the other profits have not been accounted for in the IEA calculations. One could argue that there will be huge benefits for the climate, for the local air quality and for the security of supply, and although quantifying these benefits would be difficult and was outside of the scope of the IEA report, they could represent trillions.

Moreover, the IEA remains very conservative in projecting energy prices. In the ETP scenarios, oil prices of 62 to 65 dollars per barrel are used as the baseline, while the current price is more than double, and some banks anticipate 200 $/b. 

The IEA explained in its press release that the publication 'responds to the G8 call for guidance'. Instead of showing that the 50% emissions reduction by 2050 will demand  enormous efforts – which indeed it will – the IEA could have put more emphasis on the benefits for the climate, for energy security and for the economy.

Even with world leaders going to work on a new mega-project, promising benefits will arouse one's enthusiasm better than than the perspective of an huge amount of effort.

Dear IEA, I am available to write your next press releases.

Rolf de Vos
Editor in chief
GreenPrices
r.devos@greenprices.com