IEA Contributions to the G7 in 2023

The IEA has produced a wide range of new analysis on key energy and climate topics for Japan’s Presidency of the G7, including reports on hydrogen, steel, renewables integration and natural gas – as well as contributions on critical minerals, clean energy supply chains, energy efficiency and reducing emissions from road transport.

The different analytical outputs are helping inform governments of leading economies ahead of the G7 Ministers' Meeting on Climate, Energy and Environment in Sapporo, Japan, on 15-16 April and the G7 Hiroshima Summit on 19-21 May. They were requested by the Japanese government to support discussions among G7 countries and provide insights and direction for the G7 energy and climate agenda. But the reports offer valuable analysis that is not limited to the G7 and can help inform policy making in countries around the world in these areas.

Towards hydrogen definitions based on their emissions intensity is a new report by the International Energy Agency, designed to inform policy makers, hydrogen producers, investors and the research community in advance of the G7 Climate, Energy and Environmental Ministerial meeting in April 2023. The report builds on the analysis from the IEA’s Net Zero by 2050: A Roadmap for the Global Energy Sector and continues the series of reports that the IEA has prepared for the G7 on the sectoral details of the roadmap, including the Achieving Net Zero Electricity Sectors in G7 Members, Achieving Net Zero Heavy Industry Sectors in G7 Members and Emissions Measurement and Data Collection for a Net Zero Steel Industry reports.

This report assesses the greenhouse gas emissions intensity of the different hydrogen production routes and reviews ways to use the emissions intensity of hydrogen production in the development of regulation and certification schemes. An internationally agreed emissions accounting framework is a way to move away from the use of terminologies based on colours or other terms that have proved impractical for the contracts that underpin investment. The adoption of such a framework can bring much-needed transparency, as well as facilitating interoperability and limiting market fragmentation, thus becoming a useful enabler of investments for the development of international hydrogen supply chains.

Renewables are growing rapidly in the electricity systems around the world as countries seek to improve their energy security, meet emission reduction targets and take advantage of cheaper electricity sources. Thanks to successful use of flexibility resources – from stronger grids and interconnections to demand-side measures, affordable storage and dispatchable power supply – many countries have already securely and efficiently integrated significant shares of variable renewables (VRE) in their electricity generation.

As wind and solar continue to grow as a proportion of generation, system level surpluses and periods of lower generation will eventually expand beyond hour-to-hour or daily variations to seasonal timescales. Addressing seasonal variability of renewables means that flexibility resources will be needed to varying extents throughout the year, even on a week-to-week or month-to-month basis.

The present study, produced in support of Japan’s G7 Presidency, explores the integration of VRE beyond 70% share of annual generation in future power systems, focussing on four different climatic regions: Temperate with hot summer, Tropical, cold Arid and Continental with warm summer. The study confirms that a mix of flexibility resources is needed to manage variability across all timescales and seasons. In particular, systems with very high level of VRE require seasonal flexibility services, which can be provided from existing thermal power capacities and from hydropower plants. Eventually, as energy systems transition towards net zero emissions, all flexibility services will need to be fully decarbonised. 

The implementation phase for achieving a net zero steel industry will require robust methodologies for measuring emissions at the site- and product-level, together with data collection frameworks to facilitate comparison and track progress. An existing array of methodologies and frameworks for the steel industry provide a good starting point for efforts to achieve these outcomes, but much work remains to achieve interoperability, transparency and fitness for purpose for net zero. Following an evaluation of these existing methodologies and frameworks, this report provides “net zero principles” to guide potential next steps for their development and implementation, together with specific policy recommendations for G7 members. 

In the context of Japan’s G7 Presidency, the Ministry of Economy, Trade and Industry requested the International Energy Agency (IEA) to examine the topic of Emissions Measurement and Data Collection for a Net Zero Steel Industry. This work complements that undertaken during Germany’s G7 Presidency in 2022 – Achieving Net Zero Heavy Industry Sectors in G7 Members – providing insights and direction for the G7 Industrial Decarbonisation Agenda with regard to tackling industrial emissions.

In the midst of a global energy crisis, fundamental questions are now being asked about natural gas: how can supply be assured, now and in the future, and at what price? This paper explores the uncertainty around natural gas using insights from the scenarios underpinning the World Energy Outlook 2022, as well as a selection of other global scenario-based assessments.

Using energy more efficiently has proven to be an extremely successful and cost-effective way to reduce energy demand. Highly developed and well proven policy instruments already exist to deliver increased energy efficiency, such as Ecodesign in Europe and Japan’s Top Runner. These policy tools can also support fuel switching and better demand management, helping to integrate higher volumes of variable electricity supply.

Japan’s Ministry of Economy, Trade and Industry, as part of Japan’s Presidency of the G7, asked the International Energy Agency (IEA) to examine the evolution of energy efficiency policy in the context of the clean energy transitions. The aim is to support discussions among G7 countries to provide insights and direction for the G7 energy and climate agenda.

This brochure outlines how traditional energy efficiency policy is evolving to address system-wide energy efficiency aspects such as grid flexibility and decarbonisation.

The International Energy Agency (IEA) and the Institute of Energy Economic, Japan (IEEJ) have developed and published long-term decarbonisation pathways for Southeast Asia and Indonesia. This paper provides a comparison of modelling approaches, quantitative drivers, and results from the IEA and IEEJ pathways, highlighting areas of agreement, as well as identifying and explaining differences, and thereby to derive implications. The IEA pathway used in the comparison is the Announced Pledges Scenario (APS) from the World Energy Outlook 2022 and the Energy Sector Roadmap to Net Zero Emissions in Indonesia. The IEEJ pathway is the net zero CO2 emissions in 2050 or 2060 case (CN2050/2060) from the Decarbonisation of ASEAN Energy Systems: Optimum Technology Selection Model Analysis up to 2060 study.