Editing IPCC:AR6/SR15/Chapter-2 (section)

== 2.4.3 Energy End-Use Sectors ==

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Since the power sector is almost decarbonized by mid-century in both 1.5°C and 2°C pathways, major differences come from CO <sub>2</sub> emission reductions in end-use sectors. Energy-demand reductions are key and common features in 1.5˚C pathways, and they can be achieved by efficiency improvements and various specific demand-reduction measures. Another important feature is end-use decarbonization including by electrification, although the potential and challenges in each end-use sector vary significantly.

In the following sections, the potential and challenges of CO <sub>2</sub> emission reductions towards 1.5°C and 2°C- consistent pathways are discussed for each end-use energy sector (industry, buildings, and transport). For this purpose, two types of pathways are analysed and compared: IAM (integrated assessment modelling) studies and sectoral (detailed) studies. IAM data are extracted from the database that was compiled for this assessment (see Supplementary Material 2.SM.1.3), and the sectoral data are taken from a recent series of publications; ‘Energy Technology Perspectives’ (ETP) (IEA, 2014, 2015b, 2016a, 2017a) <sup>[[#fn:r395|395]]</sup> , the IEA/IRENA report (OECD/IEA and IRENA, 2017) <sup>[[#fn:r396|396]]</sup> , and the Shell Sky report (Shell International B.V., 2018) <sup>[[#fn:r397|397]]</sup> . The IAM pathways are categorized according to their temperature rise in 2100 and the overshoot of temperature during the century (see Table 2.1 in Section 2.1). Since the number of Below-1.5°C pathways is small, the following analyses focus only on the features of the 1.5°C-low-OS and 1.5°C-high-OS pathways (hereafter denoted together as 1.5°C overshoot pathways or IAM-1.5DS-OS) and 2°C-consistent pathways (IAM-2DS). In order to show the diversity of IAM pathways, we again show specific data from the four illustrative pathways archetypes used throughout this chapter (see Sections 2.1 and 2.3).

IEA ETP-B2DS (‘Beyond 2 Degrees’) and ETP-2DS are pathways with a 50% chance of limiting temperature rise below 1.75°C and 2°C by 2100, respectively (IEA, 2017a) <sup>[[#fn:r398|398]]</sup> . The IEA-66%2DS pathway keeps global mean temperature rise below 2°C, not just in 2100 but also over the course of the 21st century, with a 66% chance of being below 2°C by 2100 (OECD/IEA and IRENA, 2017) <sup>[[#fn:r399|399]]</sup> . The comparison of CO <sub>2</sub> emission trajectories between ETP-B2DS and IAM-1.5DS-OS show that these are consistent up to 2060 (Figure 2.18). IEA scenarios assume that only a very low level of BECCS is deployed to help offset emissions in difficult-to-decarbonize sectors, and that global energy-related CO <sub>2</sub> emissions do not turn net negative at any time but stay at zero from 2060 to 2100 (IEA, 2017a) <sup>[[#fn:r400|400]]</sup> . Therefore, although its temperature rise in 2100 is below 1.75°C rather than below 1.5°C, this scenario can give information related to a 1.5°C overshoot pathway up to 2050. The trajectory of IEA-66%2DS (also referred to in other publications as IEA’s ‘Faster Transition Scenario’) lies between IAM-1.5DS-OS and IAM-2DS pathway ranges, and IEA-2DS stays in the range of 2°C-consistent IAM pathways. The Shell-Sky scenario aims to hold the temperature rise to well below 2°C, but it is a delayed action pathway relative to others, as can be seen in Figure 2.18.

Energy-demand reduction measures are key to reducing CO <sub>2</sub> emissions from end-use sectors for low-carbon pathways. The upstream energy reductions can be from several times to an order of magnitude larger than the initial end-use demand reduction. There are interdependencies among the end-use sectors and between energy-supply and end-use sectors, which elevate the importance of a wide, systematic approach. As shown in Figure 2.19, global final energy consumption grows by 30% and 10% from 2010 to 2050 for 2°C-consistent and 1.5°C overshoot pathways from IAMs, respectively, while much higher growth of 75% is projected for reference scenarios. The ranges within a specific pathway class are due to a variety of factors as introduced in Section 2.3.1, as well as differences between modelling frameworks. The important energy efficiency and conservation improvements that facilitate many of the 1.5°C pathways raise the issue of potential rebound effects (Saunders, 2015) <sup>[[#fn:r401|401]]</sup> , which, while promoting development, can make the achievement of low-energy demand futures more difficult than modelling studies anticipate (see Sections 2.5 and 2.6).

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====== Figure 2.18 ======

<span id="comparison-of-co-2-emission-trajectories-of-sectoral-pathways-iea-etp-b2ds-etp-2ds-iea-662ds-shell-sky-with-the-ranges-of-iam-pathway-2ds-are-2c-consistent-pathways-and-1.5ds-os-are1.5c-overshoot-pathways.-the-co-2-emissions-shown-here-are-the-energy-related-emissions-including-industrial-process-emissions."></span>
==== Comparison of CO <sub>2</sub> emission trajectories of sectoral pathways (IEA ETP-B2DS, ETP-2DS, IEA-66%2DS, Shell-Sky) with the ranges of IAM pathway (2DS are 2°C-consistent pathways and 1.5DS-OS are1.5°C overshoot pathways). The CO <sub>2</sub> emissions shown here are the energy-related emissions, including industrial process emissions. ====

[[File:e322b16bc219b14e094fab9d8fa9e92b Figure-2.18-1024x788.jpg|thumb|400x300px]]

Original Creation for this Report using IAMC 1.5°C Scenario Data hosted by IIASA

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====== Figure 2.19 ======

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==== (a) Global final energy, (b) direct CO <sub>2</sub> emissions from the all energy demand sectors, (c) carbon intensity, and (d) structure of final energy (electricity, liquid fuel, coal, and biomass). ====

[[File:7d01fdeeec2dad8a304824fa0bfaedae Figure-2.19-1024x1024.jpg|thumb|400x300px]]

The squares and circles indicate the IAM archetype pathways and diamonds indicate the data of sectoral scenarios. The red dotted line indicates the 2010 level. H2DS = Higher-2°C, L2DS = Lower-2°C, 1.5DS-H = 1.5°C-high-OS, 1.5DS-L = 1.5°C-low-OS. The label 1.5DS combines both high and low overshoot 1.5°C-consistent pathway. See Section 2.1 for descriptions.

Original Creation for this Report using IAMC 1.5°C Scenario Data hosted by IIASA

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Final energy demand is driven by demand in energy services for mobility, residential and commercial activities (buildings), and manufacturing. Projections of final energy demand depend heavily on assumptions about socio-economic futures as represented by the SSPs (Bauer et al., 2017) <sup>[[#fn:r402|402]]</sup> (see Sections 2.1, 2.3 and 2.5). The structure of this demand drives the composition of final energy use in terms of energy carriers (electricity, liquids, gases, solids, hydrogen etc.).

Figure 2.19 shows the structure of global final energy demand in 2030 and 2050, indicating the trend toward electrification and fossil fuel usage reduction. This trend is more significant in 1.5°C pathways than 2°C pathways. Electrification continues throughout the second half of the century, leading to a 3.5- to 6-fold increase in electricity demand (interquartile range; median 4.5) by the end of the century relative to today (Grubler et al., 2018; Luderer et al., 2018) <sup>[[#fn:r403|403]]</sup> . Since the electricity sector is completely decarbonized by mid-century in 1.5°C pathways (see Figure 2.20), electrification is the primary means to decarbonize energy end-use sectors.

The CO <sub>2</sub> emissions <sup>[[#fn:6|6]]</sup> of end-use sectors and carbon intensity are shown in Figure 2.20. The projections of IAMs and IEA studies show rather different trends, especially in the carbon intensity. These differences come from various factors, including the deployment of CCS, the level of fuel switching and efficiency improvements, and the effect of structural and behavioural changes. IAM projections are generally optimistic for the industry sectors, but not for buildings and transport sectors. Although GDP increases by a factor of 3.4 from 2010 to 2050, the total energy consumption of end-use sectors grows by only about 30% and 20% in 1.5°C overshoot and 2°C-consistent pathways, respectively. However, CO <sub>2</sub> emissions would need to be reduced further to achieve the stringent temperature limits. Figure 2.20 shows that the reduction in CO <sub>2</sub> emissions of end-use sectors is larger and more rapid in 1.5°C overshoot than 2°C-consistent pathways, while emissions from the power sector are already almost zero in 2050 in both sets of pathways, indicating that supply-side emissions reductions are almost fully exploited already in 2°C-consistent pathways (see Figure 2.20) (Rogelj et al., 2015b, 2018; Luderer et al., 2016b) <sup>[[#fn:r404|404]]</sup> . The emission reductions in end-use sectors are largely made possible by efficiency improvements, demand reduction measures and electrification, but the level of emissions reductions varies across end-use sectors. While the carbon intensity of the industry and buildings sectors decreases to a very low level of around 10 gCO <sub>2</sub> MJ <sup>-1</sup> , the carbon intensity of transport becomes the highest of any sector by 2040 due to its higher reliance on oil-based fuels. In the following subsections, the potential and challenges of CO <sub>2</sub> emission reduction in each end-use sector are discussed in detail.

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====== Figure 2.20 ======

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==== Comparison of (a) direct CO <sub>2</sub> emissions and (b) carbon intensity of the power and energy end-use sectors (industry, buildings, and transport sectors) between IAMs and sectoral studies (IEA-ETP and IEA/IRENA). ====

[[File:332935fa58dd4bbe9b8418e4636e94e1 Figure-2.20-1024x719.jpg|thumb|400x300px]]

Diamond markers in panel (b) show data for IEA-ETP scenarios (2DS and B2DS), and IEA/IRENA scenario (66%2DS). Note: for the data from IAM studies, there is rather large variation of projections for each indicator. Please see the details in the following figures in each end-use sector section.

Original Creation for this Report using IAMC 1.5°C Scenario Data hosted by IIASA

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