Daily Management Review

Petronas CEO Says Asia Must Achieve Net Zero Before The Rest Of The Globe


Petronas CEO Says Asia Must Achieve Net Zero Before The Rest Of The Globe
According to Malaysia's state-owned oil and gas giant Petronas CEO, Asia must reach net zero before the rest of the world can.
“The bulk of the emissions [that] are expected to emit will be produced in Asia going forward,” Tengku Muhammad Taufik told CNBC’s JP Ong Tuesday on the sidelines of the Energy Asia in Kuala Lumpur, Malaysia.
“The world cannot achieve net zero without Asia achieving net zero,” Taufik pointed out during the opening address of summit. Asia will represent half of global GDP by 2040, as well as 40% of global consumption, he added.
The Paris Agreement's energy transition targets cannot be carried out by "one industry, one set of policymakers, or one country alone," he stated during the keynote address.
In the 2015 Paris Climate Agreement, countries from all around the world committed to keeping global warming far below 2°C and pursuing measures to keep it below 1.5°C.
The International Energy Agency reported in March that emissions from Asia's rising markets and developing countries increased 4.2% more than those from other regions in 2022. Coal-fired power generation is responsible for more than half of this rise.
Taufik added that attempting to drastically reduce or fully stop using fossil fuels may not be the best course of action and that the idea of complete decarbonization overnight is a fallacy.
If the world wishes to avoid energy supply shocks, fossil fuels must be a part of the energy base—at least for the first half of the century.
“Unfortunately, the narrative to date has been driven by idealists. Extremists who believe there’s a binary switch that overnight we can turn from System A to System B,” he said, referring to System A as the inherent fossil fuel backed economy, and System B as decarbonizing to zero carbon overnight.
Taufik continued, "The world has not considered the full ecosystem that comes with implementing System B, such as the requirements for minerals and metals and the supply chain issues that need to be addressed first."
"Yet we seek an extreme abandonment of fossil fuels without allowing the industry to address the inherent emissions challenge," he remarked.
The globe continues to be heavily dependent on the usage of fossil fuels including oil, natural gas, and coal, according to a separate study on the world's energy forecast by the International Energy Agency.
“The share of fossil fuels in the global energy mix has been stubbornly high, at around 80%, for decades,” the report stated. In a scenario-based forecast hinging on current policy settings, the fossil fuel mix would fall to just below 75% in 2030, and above 60% in 2050.
“We’ve always positioned natural gas as a transition fuel,” the Petronas chief said, noting that recent debates have considered views that gas could even be a destination fuel because it offers a baseload of security and certainty, especially when renewables have yet to overcome intermittency issues.