Energy Star® Participants MeetingToronto, May 4, 2006

Ralph TorrieVice President, ICF International

Toronto, May 2006rtorrie@icfi.com

The Eye of the Storm or the Eye of the Needle: The

Challenge of Climate Change

1880 1900 1920 1940 1960 1980 2000

Year

0

0.2

0.4

0.6

0.8

-0.2

-0.4

-0.6

Degrees C

Five warmest years of the past century have all occurred in the past decade

First 8 months of 2005

Source: NOAA at ftp://ftp.ncdc.noaa.gov/pub/data/anomalies

Models can also be tested for their ability to realistically simulate past climate behaviour

Source: IPCC 2001. Climate Change 2001: The Scientific Basis. Contribution of Working Group I to the Third Assessment Report of the Intergovernmental Panel on Climate Changes [Houghton, J.T., et al. (eds.)]. Cambridge University Press, Cambridge, UK. p 11.

IPCC projects that the world will become MUCH, IPCC projects that the world will become MUCH, MUCH warmerMUCH warmer

Source: IPCC 2001. Climate Change 2001: Synthesis Report. Contribution of Working Groups I, II and III to the Third Assessment Report of the Intergovernmental Panel on Climate Change [Watson,R.T et al. (eds.)]. Cambridge University Press, Cambridge, UK. p 140.

Probabilistic approach suggests sensitivity near 3.2°C

Source: Murphy et al. 2004 Nature 430:768-772 (also Science 305:933)

How long have we got? We have to stabilize emissions of carbon dioxide within a decade, or temperatures will warm by more than one degree. That will be warmer than it has been for half a million years, and many things could become unstoppable. If we are to stop that, we cannot wait for new technologies like capturing emissions from burning coal. We have to act with what we have. This decade, that means focusing on energy efficiency and renewable sources of energy that do not burn carbon. We don't have much time left.

Jim HansenNASA Goddard Institute for Space Studies, February 2006

How do we defend ourselves against climate change?....

Everything goes somewhere. Everything is connected.

(You cannot do just one thing.)

Nature is an independent power, and does not

negotiate.

Start by remembering the basic “house rules” for Planet Earth…

Economy

Society

Environment

750650550450 ppmv

0

2

4

6

8

10

12

14

1950 2000 2050 2100 2150 2200 2250

Annu

al E

mis

sion

s (G

tC)

Stabilization Targets

Global greenhouse gas emission scenarios corresponding to different stabilization levels

Canadian Domestic Demand for Primary Energy, 1926-2003

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

1926 1931 1936 1941 1946 1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001

PE

TA

JOU

LE

S

Coal Petroleum

Natural Gas and NGLs Hydro

Wood Nuclear

Low Emission Futures – Context for a “Made in Canada” Approach

• Ongoing population growth• A large and growing fossil fuel production

sector oriented to export markets• Energy intensive industries (paper, metals,

steel, industrial chemicals) important to Canadian economy, although in relative decline and also climbing value added curve in globalized market

• Fuel and electricity relatively inexpensive

Oil Production (bbl/day)

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

Oil Sands

Heavy

Frontier

Light

Energy Related Carbon Dioxide EmissionsIn Canada, 1926-2050

0

200

400

600

800

1926 1951 1976 2001 2026

ME

GA

TON

NE

S

2050

Long term and deep emission reduction scenarios take us outside the climate change policy box, supports a “fresh look” at strategies and options

Energy-Related GHG Emissions by Fuel in 2003(Total emissions 600 Mt eCO 2)

Oil47%

Gas34%

Coal19%

Energy Related GHG Emissions in Canada,Source Allocation vs. End Use Allocation

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Source Allocation End Use Allocation

End Use Power Plants

Total Oil and Gas Industry End Use w Upstream Allocation

Oil/gas industry allocated to export

Personal Transportation

19%

Residential14%

Oil and Gas Export12%

Energy Intensive Industry and Mining

17%

General Mfg10% Service

14%

Freight Transportation

14%

Greenhouse Gas Emissions in Canada

(full cycle emission allocation)

Beyond Kyoto – A Low Emissions Path for Canada

0

100

200

300

400

500

600

700

800

2004 2012 2030

Me

ga

ton

ne

s e

CO

2

Non Energy RelatedEmissions

Petroleum Industry --Export Share

Petroleum Industry -Domestic Share

Industry (excl petroleum)

Freight Transportation

PassengerTransportation

Commercial

Residential

CANADA

0

200

400

600

800

1,000

1,200

1,400

2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Megatonnes eCO2

Target Carbon Capture Nuclear Biofuels and alt fuels

Renewable Electricity Energy Intensity Urban Form Cogeneration

Energy Eff and Conservation Residual

Source: R. Torrie, “Low Emission Scenarios in an Expanding, Industrialized, Oil Exporting Economy: The Case of Canada”. http://2050.nies.go.jp/2050sympo/cop11_side/Torrie_COP11.pdf

JAPAN

Source: Dr. Junichi Fujino, “Development of Japan Low Carbon Society Japan Low Carbon Society Scenarios toward 2050 Scenarios toward 2050”. http://2050.nies.go.jp/2050sympo/cop11_side/Fujino_COP11.pdf

GERMANY

Source: Martin Weiss, “Long Term Climate Policy Scenarios for Germany”. http://2050.nies.go.jp/2050sympo/cop11_side/Weiss_COP11.pdf

AUSTRALIA

0

50

100

150

200

250

300

350

2001 2040 BaselineScenario 1

2040 CleanEnergy Scenario

2

2040 Scenario 3 2040 Scenario 4

CO

2 em

issi

on

s (M

t)

Electricity generation All other stationary energy use

Source: Hugh Saddler et al., “A Clean Energy Future for Australia”. http://www.enerstrat.com.au/publications.html

AUSTRALIA -- ELECTRICITY FUEL MIX IN 2001, 2040

BASELINE, & 2040 SCENARIO 2

Electricity demand and fuel mix in 2001, and in the 2040 Baseline and Clean Energy Future Scenarios

0

50

100

150

200

250

300

350

400

2001 2040 - Baseline Scenario1

2040 - Clean EnergyScenario 2

Te

raw

att

-ho

ur

(TW

h)

Reduced demand due tomedium energy efficiency

Cogeneration

Wind

Hydro

Photovoltaic

Natural gas

Petroleum

Biomass

Brown coal

Black coal

Source: Hugh Saddler et al., “A Clean Energy Future for Australia”. http://www.enerstrat.com.au/publications.html

INDIA

Source: PR. Shukla, “Low Carbon scenarios for India to 2050”.http://2050.nies.go.jp/2050sympo/cop11_side/Shukla_COP11.pdf

A Possible “Made in Canada” Low Emission

FutureFIVE PRIORITIES

• Continued improvements in energy productivity of economy, including Factor Four Efficiency gain

• Cogeneration of electricity• Biofuels• Carbon sequestration• Decarbonize electricity generation

Collateral Benefits• Co-benefits of emission reduction will be

critical to success:– Reduced air pollution and improved public

health– Higher performance buildings– Economic competitiveness in global market– Enhanced urban environments– Employment generation across a broad

spectrum of skills and professions– Technological advancement

Synergies

• Emission reductions are consistent with some exogenous trends in Canadian society – these synergies can be exploited to promote lower emissions (urban redensification, refurbishment of post-War infrastructure, higher value added industrial production)

Implementing Low Emission Futures – The Eye of the

Needle Low emission futures have policy implications well beyond

conventional energy policy. They must be developed in a broader context of sustainable development

Energy price based strategies perhaps necessary but not sufficient Technology deployment fundamentally economic, but constrained

by underdeveloped organizational and financial infrastructure, entrenched advantage of commodity suppliers, and externalization of environmental costs.

Global marketing, rapid deployment will characterize demand side developments.

Local authorities must engage; community transformation Climatic conditions will deteriorate for decades, regardless of

mitigation effort

Canadian Domestic Demand for Primary Energy, 1926-2003 (Actual)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

1926 1931 1936 1941 1946 1951 1956 1961 1966 1971 1976 1981 1986 1991 1996 2001

PE

TA

JOU

LES

Coal Petroleum

Natural Gas and NGLs Hydro

Wood Nuclear

Economic, Energy and Emissions Growth in Canada, 1970-1998

1.00

1.50

2.00

2.50

19

70

=1

.0 GDP

Energy

Emissions

Energy Growth in Canada, 1970-1998

Oil

Gas

Coal HydroNuclear Wood

Energy Productivity

0

500

1000

1500

2000

2500

3000

3500

4000

4500 PJ

Thank you!

Ralph D. Torriertorrie@icfi.com