Unburnable coal, oil… and gas.

Simon Bullock

25 October 2013

Media coverage of last month’s IPCC 5th Assessment Report rightly focussed on the hardening of the climate science. But one part of the report has been comparatively unreported so far, and has far-reaching implications.

For the first time, the IPCC has set a global carbon budget for the EU and G8’s stated goal of avoiding 2 degrees global warming. To keep the chances of going over 2 degrees to 50:50 we can emit around up to 1100 billion tonnes (GtCO2) globally, in total, from now on. And that’s a very high risk for something we are trying to avoid – a lower risk means a lower budget. Globally we currently emit around 35 billion tonnes a year.

This immediately opens up the most sensitive of climate issues – which countries get to burn how much of what is now a limited amount of fossil fuels – coal, oil and gas.

This territory has been covered earlier this year with the highly influential work of Carbon Tracker on “Unburnable Carbon”, who point out that the world has three times more proven reserves of fossil fuels than it can safely burn. And investors managing 3 trillion dollars worth of assets today warned that fossil fuel investments increasingly risk become “stranded assets”, and called on oil and gas companies to review their spending on finding and developing new reserves.

The IPCC has now made this carbon budget analysis even more mainstream (even Shell do not dispute the maths) and it seems inevitable that it will eventually become part of the official UNFCCC process.

Friends of the Earth has published new research today, reported in Business Green, taking this analysis further. There are two stand-out conclusions.

1. No global dash for gas

The first concerns the relative future use of coal, oil and gas worldwide. Gas is often touted as an essential transition fuel, allowing the phase-out of dirty coal. But, if coal – and oil – consumption did fall dramatically, are we still able to explore for new gas reserves?

We looked at a scenario where global coal and oil consumption fell at 3% a year starting now:  a truly Herculean feat given both are currently rising. Doing this would leave a carbon budget of around 400 GtCO2 for gas – which could indeed see gas use rising in coming years. But, 400 GtCO2 is equivalent to the emissions from all proven global gas reserves. So, even with unprecedented, steep and immediate cuts in oil and coal production, to allow for gas to grow, we still cannot exploit more than current proven gas reserves. Exploring for new gas, such as shale gas, is simply adding to reserves we cannot safely burn.

2. Leave UK shale gas in the ground

The second is around the role of the UK. Any effective solution to climate change will require the co-operation of almost all nations. That will require any distribution of effort between nations to be perceived to be reasonable. So, what amount of the world’s limited remaining fossil fuel would it be acceptable for the UK to extract? Many nations would argue that the UK has already used a more than reasonable share, given the economic benefit it derived from the mammoth glut of coal production in the 20th century, and North Sea oil and gas production since 1970.

We took as a central scenario a global carbon budget from 1990 onwards – 1990 being the date used in setting targets in the UNFCCC process. We set the budget based on a “likely” – 66% chance – of keeping temperature rises below 2 degrees. An equal per capita share of this budget would leave the UK with fossil fuels with emissions of 12.2GtCO2. But since 1990 the UK has already produced fossil fuels with emissions of 12.1GtCO2. Leaving 0.1GtCO2 99% burned already.

You could be more generous (or strict!) to the UK – ignore all historic responsibility before the year 2000 say, and the UK’s remaining budget would rise to 4GtCO2. Or say that you’re happy with a 50:50 chance of dangerous climate change – which would leave the UK 2.5 GtCO2.  But even with extra leeway, by comparison the UK Government already has plans to produce conventional oil and gas and coal with emissions 4GtCO2. Central estimates for shale gas would add 7GtCO2 more.

This matters for UK climate diplomacy. We can hardly expect the Chinese or anyone else to heed our calls not to build more coal mines and power stations if we are merrily exploiting as much new oil and gas and shale gas as we can. Most of what exists globally already cannot be burned; the UK’s shale gas plans are just adding to a huge unburnable carbon problem. If we continue in this way, why should other nations not just do the same?

The UK should reverse its strategy to maximise fossil fuel production, and focus on minimising demand instead. This is the big untapped potential – for example DECC estimates that UK gas demand will fall by only 0.2% a year to 2030. The UK should call a halt to new oil, gas and shale gas exploration, and invest in energy efficiency and renewable power instead.

The IPCC’s new carbon budget will be a game changer. The world should not be searching for new sources of fossil fuel. We can’t even burn all of what we already have. We need to keep the coal, oil and the gas in the ground.

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