IEA signs death knell for new fossil fuel projects

The Australasian Centre for Corporate Responsibility​ (ACCR) is calling on ASX-listed companies to abandon all new fossil fuel projects, as per the International Energy Agency’s ‘Net Zero by 2050’ report published today.

The IEA report concluded that:

• There is no need for investment in new fossil fuel supply (beyond projects already committed);
• Oil and natural gas supplies will become increasingly concentrated in a small number of low-cost producers;
• Phase out all subcritical coal‐fired power plants by 2030;
• Advanced economies should decarbonise their electricity sectors by 2035, emerging market and developing economies by 2040;
• Net zero means a huge decline in the use of fossil fuels as the energy sector will largely be based on renewable energy.

Commenting on the report, Dan Gocher, Director of Climate & Environment at the Australasian Centre for Corporate Responsibility (ACCR) said:

“The IEA Net Zero report has enormous implications for ASX-listed companies, particularly those involved in oil and gas production, including BHP, Origin Energy, Santos and Woodside. It is also just as damning for those involved in electricity generation like AGL and Origin, and companies involved in fuel refining like Ampol and VIVA Energy.

“Those oil and gas projects that have yet to be sanctioned, including Woodside and BHP’s Scarborough project, Santos’ Narrabri project and Origin’s Beetaloo project, are simply not consistent with a net zero by 2050 pathway.

“AGL has previously ignored shareholders’ demands to bring forward the closure of its remaining coal-fired power stations; now it will have to ignore the IEA at its peril. AGL should expect investor pressure to intensify for early coal closure.

“Just this week, Ampol and VIVA Energy were the recipients of massive subsidies to upgrade their fuel refineries. Beyond seeking government handouts, neither company has a credible plan to net-zero emissions, and they seem ill-equipped to deal with the energy transition put forward by the IEA.

“The IEA report makes a mockery of the Australian government’s so-called ‘gas-fired recovery’, as well as its recently announced subsidies for fuel refineries, and its do-nothing electric vehicle policy.

“The IEA report provides us with a map to net zero, now we must have the courage to follow it.”

Background

All Australian coal-fired power stations are sub-critical, with the exceptions of Callide C, Kogan Creek, Milmerran and Tarong North which are super-critical (all in Queensland).