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IEA says net-zero by 2050 is a distant dream without help to Nigeria, others

An energy transition that fails to engage with the needs of Nigeria and other fossil fuel-producing countries will find it difficult to achieve global net-zero emissions by 2050, the International Energy Agency (IEA) has said.

According to the Paris-based agency, if oil revenues start to decline before producer countries have successfully diversified their economies, livelihoods will be lost and poverty rates will increase.

“A lot of oil-producing countries will need support to capitalise on their huge solar resources and address global warming otherwise, the path to net-zero and the security of the world’s energy markets will both be imperilled,” Fatih Birol, the executive director of the International Energy Agency said in a statement seen by BusinessDay.

In Nigeria and other oil-producing countries, global warming is not a distant threat, but an already painful reality.

To stand a chance of limiting the worst effects of climate change, IEA says the world needs to fundamentally change the way it produces and consumes energy, burning less coal, oil and natural gas.

The International Energy Agency’s recent global roadmap to net-zero by 2050 shows the world’s demand for oil will need to decline from more than 90m barrels a day to less than 25m by 2050.

IEA noted that this development would result in a 75percent plunge in net revenues for oil-producing economies, many of which are dominated by a public sector that relies on oil exports and the revenues they produce.

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“If oil revenues start to decline before producer countries have successfully diversified their economies, livelihoods will be lost and poverty rates will increase,” Birol said.

In order to address this, the IEA chief said there will be a need for policies and investments that enable oil and gas-producing countries channel capital and labour into productive industries for the future and stimulate the private sector.

He explained further that more than at any point in history, fundamental changes to the economic model in resource-rich countries look unavoidable.

“Reaching net-zero emissions will require much stronger actions and much greater international collaboration,” Birol noted.

He added: “The impact of Covid on the oil market last year gave us a fleeting image of what the region’s economies could look like in the future in a world where demand for oil and gas is structurally weaker – and where countries do not take serious measures to diversify their economies and increase their resilience.”

A recent IEA report shows that for every $1m invested in energy efficiency, up to 30 jobs are created, a development that is crucial for a country such as Nigeria, with its young and fast-growing population.

The IEA warned in May that for the world to stay within 1.5C above pre-industrial levels, the lower limit set out in the Paris agreement – to which all Organisation of Petroleum Exporting Countries (OPEC) are signatories – then all new oil exploration must cease from this year.

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