Energy is key for climate solutions

Ladies and gentlemen,

It is a pleasure to be back here at “Det norske teater”. The stage is set for energy insights. The lead player is the International Energy Agency presenting their flagship publication – World Energy Outlook 2009. I am very pleased that Mr. Birol has had the opportunity to visit us so soon after the launch of the Outlook and also to see the large audience this occasion has attracted. 

This year’s World Energy Outlook visualise how critical the upcoming United Nations Climate Change Conference in Copenhagen will be: If no agreement is reached in December, IEAs analysis estimates that the cost for the world will be enormous: to quote directly from the World Energy Outlook: it will cost us 500 billions US Dollar – a year. Hence, the IEA have analysed “how the energy sector can deliver on a climate agreement in Copenhagen”. The analysis delivers a simple message: “if the world continues on the basis of today’s energy policies, the climate change impacts will be severe.” Energy, which account for two-thirds of the emissions, is thus at the heart of the problem, and must be part of the solutions.

The Copenhagen-Climate Change Conference is now less than a month ahead of us. The Norwegian Government has always aimed at an international legally binding agreement that will limit global warming to two degrees, compared to preindustrial levels.

We, the developed countries must take the lead in the global efforts to reduce green house gas emissions. This is why the Norwegian Government is willing to commit itself to an ambitious climate target corresponding to a 40 per cent cut in emissions from the 1990 level by 2020. We are willing to take on this commitment if this can contribute to an agreement on an ambitious climate regime that includes specific emissions targets on the part of the major emitters.

As you all know, Norway is strongly advocating carbon capture and storage as a necessary tool to reach the two degree goal. The analysis in the World Energy Outlook really underlines this fact.

We must all work towards an ambitious and effective international response to climate change in Copenhagen. The Norwegian Government work towards a Copenhagen agreement that include political recognition of the importance of carbon capture and storage.

Deploying CCS is critical to maximizing CO2 mitigation opportunities worldwide. The inclusion of CCS in an appropriate international mechanism will also contribute to speeding up the transfer of technology and expertise to developing countries. Knowledge sharing and capacity building activities are imperative in making both countries and industry capable of deploying CCS technologies.

The negotiations in Copenhagen will be difficult. But there is no time to lose.

Last month, the UK minister of Energy and Climate Change and I hosted The Carbon Sequestration Leadership Forum in London. Several ministers from key countries were represented, including both the Energy Secretary from the US and the Chinese minister. We all agreed that CCS should be recognized as a key mitigating technology. Furthermore, we also recognized that the number of CCS projects need to be dramatically increased and we need projects both in the developed and developing countries.

Following the CSLF meeting, I visited Fatih Birol’s home turf, to participate at the IEA Ministerial Meeting, in Paris. One of the IEA’s founding fathers, Dr. Henry Kissinger, was invited to share his perspectives on energy trends and the role of the IEA. Dr. Kissinger highlighted one crucial subject which has emerged in recent years: The issue of climate change. Few will disagree with his point of view: We can’t discuss energy without also addressing climate change issues.

I am proud to represent a Government which follows the path to a more climate friendly future, as set out by the IEA. Our approach is fourfold:

- First, to strengthen our energy efficiency programs
- Second, to strengthen our efforts in renewable energy
- Third, to mature key future energy technologies such as Carbon Capture and Storage and offshore wind turbines
- And finally, to produce oil and gas under strict environmental standards

Let me add a few remarks on these crucial issues.

As for the two first we have ambitious policies to realize the huge potentials for using energy more efficiently and for producing more renewable energy. The main vehicle to promote energy efficiency and renewable energy is Enova. Enova is our main agent in the transition to a more efficient and environmentally friendly national energy supply and use. Over the last years Enova’s budget has increased substantially. In 2010 Enova will dispose of 1,8 billion Norwegian crowns.

The Government also promotes energy efficiency through other kind of measures like tougher building codes, eco labels and standards, targeted duties and taxes etc. Although, hydro power generates most of our electricity – we still push for more renewable energy. I am pleased that Sweden and Norway have agreed on principles for a common green certificate market.

Next, we must meet the challenge of securing a sustainable future energy supply by reducing the emissions from the production and use of fossil fuels. The Norwegian Government together with Statoil and Shell started construction of the CCS Technology Centre at Mongstad in June. The primary goal is to gain knowledge that will reduce cost and risk. I am proud to say that the Government will use approximately 1 billion USD on CCS in 2009 and 2010 combined.

I would also like to commend Statoil in their commitment to CCS. Statoil has played an important part in the development of CO2 storage as a mitigation tool.  In 1996 Statoil started the world famous Sleipner project. The first and largest CO2-storage project globally. Last year the second project, Snøhvit, started up.

Finally, Norway shall remain a world leader in environmental friendly extraction of oil and gas. We have one of the world’s lowest emissions per unit oil produced and we have minimized the use of chemicals offshore.

In addition to these four areas, Norway will also make a significant contribution to emission reduction in the developing world, especially through our deforestation program.

There is no quick fix when it comes to making the global energy picture more sustainable.

More people than ever before lack access to modern energy. Faced with population growth, economic growth is needed to reduce poverty and provide prosperity and welfare – especially in the developing part of the world. Such a process is fueled by energy.

Global energy needs will increase going forward. In its’ two degree scenario, the IEA shows how we can both save the climate and at the same time allow for increased energy use in the developing world.

It is worth noticing that the world will consume more oil and gas in 2030 than today, also in the 2 degree scenario. We know that only to keep global production flat, large capacity additions every year is required to replace the decline in existing fields. Further, oil production will come from a decreasing number of countries, putting energy security at risk. For Norway, I think I can say that we will keep on investing on the Continental Shelf to soften the decline in oil production, contribute to global energy security, and maintain employment and value creation.

Gas is crucial in any energy scenario. In a carbon constrained world, gas will substitute coal in the power sector, contributing to lower emissions.

Further, gas – in addition to hydro-power – is becoming an important backup-fuel for countries which are expanding variable renewables in the energy mix.

To sum up and conclude, securing energy supply and speeding up the transition to a low-emission energy system call for radical action by governments.

I remain an optimist. The cell phone in your pocket shows that technological breakthroughs do happen. The IEA shows that a revolutionized energy path is possible.

Thank you for your attention.