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Factbox: IEA's urgent fossil fuel warning earns mixed reception from producers

Berita 24 English -  The world's top energy body's stark appeal to stop new fossil fuel projects by next year has elicited a mixed r...

Berita 24 English - 
The world's top energy body's stark appeal to stop new fossil fuel projects by next year has elicited a mixed response from the world's top producers, ranging from cautious praise and pledges to reduce coal consumption to outright defiance.

The International Energy Agency warned investors last week in its "Net Zero by 2050" report that they should refrain from funding new oil, gas, and coal supply projects beyond this year if the world is to achieve net-zero emissions by mid-century and meet the goals of the 2015 Paris Climate Agreement.

Its findings aim to encourage countries attending the United Nations Climate Change Conference (COP26) to adopt ambitious climate targets in November in Glasgow, Scotland. Still, they have yet to garner a full commitment from any country.


The world's seven largest advanced economies agreed on Friday to phase out international financing of carbon-emitting coal projects by the end of this year.

The United States, the United Kingdom, Canada, France, Germany, Italy, and Japan – as well as the European Union – issued a joint statement stating that "unabated international investments in coal must halt immediately."


Alok Sharma, the UK minister, presiding over the United Nations Climate Change Conference in Scotland and requested the IEA publish its Net Zero report, refrained from committing to a fossil fuel ban.

"I applaud this @IEA report, which lays out a path to #NetZero and aligns with many of the UK's priorities," Sharma tweeted, adding that the UK desired to "consign coal power to history."

In March, the UK government agreed with North Sea industry players to allow new offshore oil licensing rounds in exchange for emissions reduction pledges.

In response to the G7's climate communique, Sharma stated, "We are acting internationally in the same way we are acting at home by agreeing to phase out international fossil fuel finance, beginning with coal."


Norwegian Prime Minister Erna Solberg dismissed the IEA's roadmap as one of "many reports," telling the NTB news agency that it would have no effect on the country's petroleum policy.

Norway has offered tax breaks to new high-cost oil projects and is preparing new offshore exploration licenses.

"If this roadmap becomes a may affect companies' interest in making new discoveries in the long run," Tina Bru, Norway's Oil and Energy Minister, told Reuters.


Gina McCarthy, the White House's National Climate Advisor, said the IEA's advice deserved close examination, but that change would be gradual, and fossil fuel projects would continue to be developed.

"I believe that is one of the issues that we must consider and wrestle with... I'm not implying that this transformation will occur quickly," she said, noting that hundreds of new natural gas units in the United States were planned.

John Kerry, the United States' climate envoy, praised the report and refrained from making any new commitments.

"The new @IEA report provides critical guidance on how the energy sector can achieve net-zero emissions by 2050," he tweeted. "It demonstrates that we must accelerate the adoption of existing technologies to significantly reduce emissions by 2030."


Frans Timmermans, the European Union's head of climate change policy, stated that the bloc intends to work harder to reduce emissions through changes to its tax system.

"It is not coincidental that we will propose amending the energy taxation regulation," he explained in an interview with the news website Euractiv. "We must wean ourselves from oil, gas, and coal. We require a just tax system that incentivizes this."

"That is the general direction we will take. And I am heartened by the IEA's recent net-zero report.


Japan, Asia's third-largest carbon emitter in 2019, behind China and India, stated that the report contradicted its policies.

Akihisa Matsuda, deputy director of international affairs at the Japanese Ministry of Economy, Trade, and Industry (METI), stated that the government has no immediate plans to halt oil, gas, and coal investments. [L2N2N703B] [L2N2N703B]

"The report makes one recommendation for how the world can achieve net-zero greenhouse gas emissions by 2050, but it is not always consistent with the Japanese government's policy," he said.


OPEC said that if the IEA's recommendations on reducing fossil fuel emissions are implemented, it could result in oil price volatility. [L2N73LKL5N2N73LKL5N2N73LKL5N2N

"The claim that no new oil and gas investments are required after 2021 contradicts frequently expressed conclusions in other IEA reports and could be a source of potential market instability if adopted by some investors," OPEC's report stated.

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