The IEA WEO 2019 – Not Even Wrong

“…nicht einmal falsch!”

There has been plenty coverage so far of the IEA’s WEO 2019, much quite negative,  and we think the criticism fair, despite the IEA’s self-accredited award of the “gold standard of energy analysis”.

Once again the IEA have sunk further into the incumbent / Business-as-Usual (BAU) camp of zero disruption and thus linear, long-term growth of fossil fuels as their base scenario (STEPS).

They also retain a prominent high-end growth assumption for fossil fuels (probably labelled Armageddon in deference to its nihilist, change-nothing policy assumptions).

We suggested this would be how the IEA would conduct itself in a recent post, here.

In short – the IEA STEPS outlook is a falsified theory: it attempts to force a BAU transition by various untenable methods they have adopted and refined for many years now.

In breaks down into two strategies:

1 – Underplaying the strength and deployment of new energies using a series of established techniques, even as they talk strongly of the relentless deployment of these technologies today.

They do this by,

– Ignoring latest growth rates and advances in solar / wind – by positing sudden pivot to low-growth eg 100-130GW pa PV solar by using extremely negative outlooks – this has been wrong for over a decade

– Over-emphasising policy road-blocks and infrastructure issues – even though 90% of world states have a fossil fuel fuel deficit, but 100% have a sunshine surplus

–  Using smooth exponential growth techniques that underplay wind/solar growth right now (eg average 10%pa growth to 2040 suggests a sudden halt in today’s > 20% growth immediately)

– Mis-stating the size of electricity as only 20% of energy – it’s not, it’s 40%, this is a basic algebraic error. This “fact” is then used to suggest wind/solar can’t provide the heft for a major energy transition by themselves, when in fact they probably can.

Then  2 – Overplaying the resilience of oil,  gas and coal via:

– The Decline rate delusion – again plying the myth that oil will decline 8%pa tomorrow if all investment stopped – a straw man as we have noted which allows immortal investment plans – in the STEPS scenario oil and gas is still investing $300bn pa in 2041-50!

– Smooth low-level, uninterrupted exponential growth of eg 1-1.7% pa – which massively overstates long-term outcomes and conveniently allows no peaks at any point until at least beyond 2050

– Endless growth of the rump of the current barrel (marine, petrochemicals, even bitumen for god’s sake) which compensates for collapse of transport, and for which evidence looks less and less secure

– Bizarre non-sequitur conjectures – eg the rise of SUVs slowing electrification overlooking the rise of, er,  e-SUVs

Indeed, even in the IEA’s sustainable pathway “towards” Paris commitments, their half-hearted SDS scenario we have a need for :

– Massive Efficiency gains (always safe ground for the IEA to fill gaps)
– A return to nuclear (China, perhaps France – and ?)
– The sudden and miraculous  emergence of CCS , and so on

Rather than a simple more realistic deployment of solar / wind – which by their own admission is amassing at a rate – the IEA then  immediately lather such progress with antipathy.

It is this almost coherent litany of closed, Orwellian, double-think that gets the IEA to every year state yet again 20% pa growth plus 20% pa growth equals 10% growth.

Their WEO has now become a pastiche, its forecast no better than ironic, with plenty of winks to and shibboleths for the incumbent benefactors it relies on.

It has a core mission on energy security which they may believe give them cover to act this way: but that has now been far superseded by the CO2 impact and health / security concerns that their support for complacent incumbent investment allows to thrive.

Their annual review deserves as much coverage and objective authority as Exxon’s Outlook for Oil, or Peabody’s Outlook for Coal.

The WEO2019 marks the point where it is fair to stay The IEA’s forecasts are Not Even Wrong.

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