The top 5 energy stories in 2015

This year, governments, investors, and companies made bold commitments to support clean energy and shift away from fossil fuels. But though renewables are on the rise, coal maintains a stronghold in the energy mix, underlining the challenges that remain in transitioning to a low-carbon global economy.

The energy landscape in 2015 was marked by unmistakable progress in the clean energy sector, with renewable energy adoption rates hitting new highs across the world, the Paris climate deal locking in a goal to cap global temperature rise and reduce emissions, and widespread divestment from fossil fuels signalling a withdrawal of support from dirty energy.

Economic growth and energy emissions also decoupled for the first time ever according to the International Energy Agency. But even as clean energy grew, several controversial oil and coal projects were announced this year, highlighting the challenges of meeting energy demand in an affordable and sustainable manner.

Here are our picks for the top 5 energy stories of 2015:

1. Renewable adoption soars

Oil prices fell to historic lows this year of about US$36 per barrel in December, which led to concerns that renewables would be unable to compete with cheap fossil fuels. But this did not stop governments and businesses worldwide from ramping up clean energy adoption.

India and China, for example, announced ambitious renewable energy targets: In March, India committed to increasing its renewable energy capacity to 175 gigawatts (GW) by 2022, four times its 34 GW capacity recorded in February. 

China, meanwhile, remained Asia’s clean energy leader, spending as much as the US and Europe put together on clean power. The International Energy Agency (IEA) noted in June that the country is now the largest wind power market in the world, and renewable energy now accounts for a quarter of its power generation - from almost zero just 10 years ago. 

In the United Kingdom, renewable energy for the first time overtook coal in supplying the country’s electricity between April and June, accounting for a quarter of electricity generation compared to coal’s 20 per cent share.

The United Nations in April shared that new renewable generating capacity broke the 100 gigawatt barrier in 2014, equivalent to all nuclear plants in the US, while IEA in November said that renewable energy accounted for nearly half of all new power plants in 2014, a sure sign that “an energy transition is underway”. 

Despite the fact that US$490 billion is spent on fossil fuel subsidies annually, 60 per cent of all new energy investment goes to renewables, and it is becoming a “mainstream fuel”, added the agency.

2. Energy and emissions decouple

The International Energy Agency in March announced that for the first time ever, world energy consumption had grown, but the sector’s emissions had not.

Emissions of carbon dioxide were flat at 32.3 billion tonnes in 2014 from 2013, according to the IEA, which dubbed this trend a “welcome but significant surprise”, and a sign that sustainable economic growth is possible.

The Paris-based IEA, which advises governments of developed nations, said the halt in emissions growth was linked to greener patterns of energy consumption in China, the top carbon emitter ahead of the United States, and in developed nations.

Even as analysts welcomed this trend, they emphasised that it was not enough to simply stop emissions from increasing.

3. Exodus from fossil fuels

The fossil fuel divestment movement - which urges financiers to pull funding from coal, oil, and other polluting energy sources - came of age this year, growing fifty-fold since last September, according to US-based philanthropy consultancy Arabella Advisors.

In a September report, the organisation said that at the New York climate summit last year, 181 institutions and 656 individuals representing over $50 billion in assets had committed to divesting from fossil fuels. A year later, this figure stood at 436 institutions and 2,040 individuals across 43 countries and representing $2.6 trillion in assets.

While foundations, universities, and faith groups got the ball rolling last year, large pension funds, insurance companies, governments - and Hollywood superstar Leonardo DiCaprio - got into the act in 2015.

Notable examples include the Norwegian Parliament’s decision in June to remove coal investments from the country’s US$890 billion government pension fund, which is considered the largest sovereign wealth fund in the world, and the City of Melbourne in Australia, which pledged not to invest in fossil fuels in the future.

In December, two of the world’s biggest institutional investors – German firm Allianz and Dutch pension fund ABP – joined the Portfolio Decarbonisation Coalition, a group of investors which has promised to rid their portfolios of high carbon investments.

Many saw the Paris agreement as a final nail in the coffin for fossil fuels. Shortly after the deal was inked on December 12, British investment bank Barclays predicted that it will likely cause the fossil fuels industry to suffer a loss in revenue of around $US33trillion by 2040 over business as usual.

4. Hydropower - (un)sustainable?

The growth of renewable energy has not been free of controversy. In particular, there has been growing opposition to new hydropower projects in 2015 due to socio-economic and ecological concerns.

The World Energy Council, a UK-head-quartered forum for energy research, released a report in May showing that hydropower has the potential to double in capacity from 1,000GW today to 2,000GW by 2050, helping to reduce fossil fuel emissions and enable irrigation.

But public acceptance, cross-border water disputes, and ecological damage to flooded areas remained key challenges. In October, two dozen indigenous anti-dam campaigners from Brazil, India, Honduras, and several Southeast Asian nations gathered at the World Indigenous Summit on Environment and Rivers in Sarawak, Malaysia, to protest large hydroelectric dams.  

They were particularly concerned about a proposed dam on the Sarawak’s Baram River, which would displace up to 20,000 people and submerge their lands. Although the government in July imposed a temporary moratorium on the dam, campaigners wanted a more permanent end to the project.

Meanwhile, environmental watchdog Viet Nam River Network in September urged the Laos government to reconsider its approval for the Don Sahong project along the Mekong River, because it will cause ecological damage downstream and displace communities.

Cambodia, too, “vowed to prevent” Laos from going ahead with the dam, a call that was echoed by some residents in Laos itself, according to a representative from a Laotian green group.

5. Coal hangs on

Coal and other fossil fuels maintained a stronghold in many parts of the world. This was seen through the continued prevalence of fossil fuel subsidies, which according to the Organisation for Economic Co-operation and Development, amount to between $160 billion and $200 billion per year.

Governments across the world also continued signing off on new fossil fuel projects, despite protests. In Australia for example, the government in December gave the go-ahead for a US$12 billion coal project by Indian conglomerate Adani, which wants to build a mine in the ecologically fragile areas surrounding the Great Barrier Reef.

In the United States, too, the government in April gave oil behemoth Shell the final permit needed to drill for oil in the Arctic Ocean off Alaska, triggering alarm among green groups about the dangers of drilling in such a sensitive ecosystem. Despite months of high-profile protests, Shell proceeded with its exploration, only to announce in September that abandon the venture because the oil reserves in the Arctic fields are prohibitively expensive to extract.

This story is part of our Year in Review 2015 series, which looks at the top stories that shaped the business and sustainability scene in each of our 11 categories.

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