To that end, Birol has identified two concrete goals that energy companies should take to align with the net zero ambition. First, oil and gas companies need to commit to cutting emissions from their operations and supply chains—so-called Scope 1 and Scope 2 emissions—by 60% by 2030. Anfrom the IEA found that nearly 15% of global emissions come from the business of getting oil and gas out of the ground and transporting it to consumers.
Second, Birol says fossil fuel companies need to commit to ramping up their investment in clean energy technologies. Last year, oil and gas companies devoted about 5% of their spending to areas outside of their traditional fossil fuel supply business, according to an IEA. That low percentage not only means less capital is flowing into clean technologies but also that the companies aren’t fully utilizing their expertise in a way that could benefit the transition.
Birol says the IEA is currently pushing “very strongly” for oil and gas companies to make those commitments in time for COP28. “There are people who say oil and gas companies have no seat on the table in the COP meeting,” he says. “I think we need to build a grand coalition of governments, energy industry, civil society, and investors who sincerely believe in the fight against climate change.”
But Birol isn’t relying on the urgency of climate alone to make the case to energy companies. He says he points to investment trends to suggest to energy companies that if they move too slowly they risk being left behind. On the morning of our interview, the IEA released aprojecting that more than $1.7 trillion will be invested in clean energy technologies this year, a nearly 25% increase over the last two years.