Renewable energy 20,000 27% 15,000 19% 10,000 13% 13% 13% 13%

10 15 20 25 30

5,000 0

2010 BAU

2050 BAU

Energy demand

2010 G2

RE in energy

Figure 6: Trends in BAU and G2 scenarios in total energy consumption (left axis) and renewable penetration rate (right axis)

■ Wind power generation: 35 per cent of power generation investment in 2011, declining to 15 per cent in 2050 (additional US$ 63 billion in 2011 under G2), with an average additional investment of US$ 76 billion per year over the 40-year period.

Biofuel production accounts for the other 50 per cent of the energy investment, with an average additional investment of US$ 327 billion per year over the 40-year period under G2. Increments in biofuel production are assumed to shift from first generation to second generation biofuels, using agricultural residues. In general, second-generation biofuels considerably reduce the pressure on diverting agricultural land from food production in the simulations.34

In 2025 and

2050, the production of second-generation biofuels, from agricultural and forestry residues, is projected to reach 490 billion litres of gasoline equivalent (lge) and 844 billion lge, meeting 16.6 per cent of world liquid fuel consumption by 2050 (21.6 per cent when first generation biofuels are also considered). Around 37 per cent of agricultural and forestry residues would be needed in the G2 scenario. In case residues above 25 per cent are not available or usable (as indicated by the IEA 2010b), marginal land is assumed to be used for growing crops for biofuels.

The substitution of investments in carbon-intensive energy sources for investment in clean energy will

34. Note that investments in the agricultural sector, as part of the green investments scenarios, are also increasing the productivity of land, thus also reducing the potential conflict between biofuels and food production.

35. The IPCC (2011) review was conducted before the GER modelling results were published; see Krey and Clarke (2011) for more details of the IPCC review, which does cover studies published during or after 2006. Of the 164 scenarios reviewed, 26 (about 15 per cent) constitute baseline scenarios.

2050 G2

0 5

%

5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000

0

2010 BAU

2050 BAU

Power generation

2010 G2

RE in power

Figure 7: Trends in BAU and G2 scenarios: power generation (left axis) and renewable penetration rate in power sector (right axis)

increase the penetration rate of renewables to 27 per cent of total primary energy demand by 2050 under G2, compared with 13 per cent under BAU. In the power sector, renewables (including hydro, waste, wind, geothermal, solar, tidal and wave) will account for 45 per cent of total electricity generation by 2050, substantially higher than the 24 per cent under BAU. The share of fossil fuels, coal in particular, will decline accordingly to 34 per cent in 2050, compared with 64 per cent in the BAU scenario, mostly due to the expansion of renewables (Figure 6, Figure 7, and Table 11). Table 11 compares the resulting energy mix under G2 to the IEA’s BLUE Map 450 Scenario as published in the ETP 2010 (IEA 2010b). The results are similar in terms of renewables penetration and differ primarily in terms of the lower share of nuclear energy in G2, as this technology is not targeted with additional investments. As discussed below, this partly explains the fact that the G2 scenario does not receive the same amount of emissions reduction as the BLUE Map 450 Scenario.

In general, G2 can be seen as conservative relative to some more ambitious scenarios that have been modeled by other. The results of G2 are relatively close, though, to the median found by the IPCC (2011) in their review of 164 global scenarios from 16 different large-scale integrated models.35

These scenarios cover a wide range

of renewable energy penetration rates, with the highest reaching approximately 43 per cent of primary energy supply in 2030 and 77 per cent in 2050. More than half of the reviewed scenarios resulted in the share of renewable energy in primary energy supply reaching at least 17 per cent by 2030, and at least 27 per cent by 2050, compared with 19 per cent and 27 per cent, respectively, under G2. On the other hand, most baseline scenarios reviewed by

2050 G2

45% 50 % 40 29% 30 24% 20% 16% 16% 20 10 0

223

Mtoe/yr

TWh/yr