Decarbonisation Technology - November 2022

Roadmap to decarbonisation A look at the roadmap towards decarbonisation by charting new pathways in the global energy sector

Henrik Larsen KBR

I n the quest for decarbonisation, the world is facing a huge challenge today. To combat climate change, we must meet the objectives of the Paris Agreement by limiting global warming to 1.5ºC. The journey towards achieving net-zero emissions by 2050 requires trillions of dollars of investment in technologies and infrastructure for low-carbon fuels and electrification to create new pathways for the global energy sector. To meet the goals set in the Paris Agreement, it is estimated that low-carbon fuels will have to make up more than 10% of the total energy consumption worldwide. Hydrogen is slated to play a vital role in decarbonising energy needs that cannot easily be directly electrified in shipping, aviation, and heavy industries. It can be used either as a direct clean fuel, which upon combustion emits only water, or as the key building block for other clean fuels like ammonia and methanol. The demand for low-carbon hydrogen is estimated to exceed 500 MMTPA in 2050, representing a six-fold increase in current demand. This will require an unprecedented need for investments in highly efficient and flexible solutions. Team effort Emerging from the Covid-19 pandemic, which was accompanied by a decrease in CO₂ emissions from 2019 to 2020 of 7-8%, we are faced with the reality that CO₂ emissions must be reduced by nearly 6% year-on-year to achieve the targets in the Paris Agreement. Although the targets for low-carbon fuels and direct electrification are relatively clear, getting there will require a considerable build-up of renewable energy globally. The IEA estimates it will require

double the current annual addition of renewable energy for the global energy pool. These investments exclude those needed for a similar expansion of the electricity grids to carry extra energy and distribution to additional customers. Imagine that in 2050, about a billion electric vehicles (EVs) will be on the roads every day. Then, imagine the charging infrastructure to support that. We will need: • Policies and frameworks that both encourage the development of infrastructure through numerous partnerships in the public and private sectors and jointly support de-risking • Space to install renewable energy capacity from solar and wind, with appropriate allocations/approvals • Development and support for the frameworks needed to trade across borders and to enable the distribution of renewable power to the sectors required, thereby achieving the required energy mix in 2050, i.e. energy directed to both electrification and low-carbon fuels routes The recently implemented US Inflation Reduction Act of 2022 is an excellent example of a framework that aims to encourage further development in clean energy via a tax credit scheme, and is expected to have a significant impact on the development of clean energy projects in the US. Indeed, we have already received positive feedback from partners and clients, stating that this will further boost their projects moving forward. Innovation and scale are key Besides the massive build-up needed for renewable energy and low-carbon fuels, a parallel, continuous effort in technological innovation is needed to reach the net-zero target. The cost of renewable power has