Published

8 months ago

November 18, 2025

Alice Rush

The energy world is changing fast, yet not fast enough to protect the planet from dangerous warming. The International Energy Agency’s (IEA) World Energy Outlook 2025, released at the start of COP30 in Brazil, lays out three futures for global emissions. These scenarios show how close — or far — the world is from meeting the goals of the Paris Agreement. The findings are sobering, but they also give countries clear signals on where action must accelerate.

The IEA makes one point very clear: 2024 was the hottest year ever recorded, and for the first time, global temperatures stayed above 1.5°C across the entire year. The last decade was also the hottest in history. This puts huge pressure on countries as they update their national climate plans at COP30.

Yet the IEA also stresses something important — none of its scenarios are forecasts. They are pathways, and the direction we take still depends on policy choices made today.

A World on a Hotter Track: What the IEA’s Scenarios Show

The IEA’s three major scenarios outline different ways the global energy system could evolve. Two reflect today’s conditions. The third shows what it would take actually to reach net-zero emissions by 2050.

Current Policies Scenario (CPS): The Dangerous Path

This scenario assumes governments stop at policies already written into law. No new climate pledges. No new incentives. No strengthened targets.

Under this path:

Coal use falls only slightly.
Oil and gas demand have been rising for decades.
Global energy-related emissions stay close to 2024 levels all the way to 2050.

The result is alarming. Global warming will hit 2°C by around 2050 and reach 2.9°C by 2100, and temperatures will still be rising. The IEA even warns there is a 5% chance of hitting 4°C, a level associated with extreme climate disruptions and irreversible tipping points.

The CPS was removed after 2020 because it seemed unrealistic in a world trying to cut emissions. But political pressure, especially from the Trump administration, pushed the IEA to bring it back. Its return shows how vulnerable global climate ambition can be when big economies shift direction.

Stated Policies Scenario (STEPS): Better, but Still Off-Track

This scenario reflects what governments say they plan to do — but not what they have legally locked in.

Here:

Emissions peak within a few years.
They fall slightly to 35.2 gigatonnes (Gt) in 2035.
Advanced economies and China reduce emissions.
But developing economies emit more as energy demand rises.

Even with these changes, the STEPS pathway still results in 2.5°C of warming by 2100. This is far above the Paris goal of “well below 2°C” and nowhere near keeping warming under 1.5°C. The IEA notes that this year’s STEPS outcome is worse than last year’s due to slower clean energy progress and higher expected coal use.

Net Zero by 2050 Scenario (NZE): The Only Path that Stabilizes the Climate

Net Zero by 2050 Scenario, often called the NZE, shows what a 1.5°C-aligned future would require. It is the only pathway that eventually brings warming back below 1.5°C by the end of the century.

But the challenge has grown sharply. Because real-world emissions remain high, the NZE scenario now includes:

a higher and longer overshoot of the 1.5°C limit
warming peaks around 65°C mid-century and slowly declines

Large-Scale Carbon Removal Technologies: The Saviour

The only way to return below that threshold later this century is to combine deep emissions cuts with large-scale carbon removal technologies. These technologies remain expensive and unproven at the scale required.

So the IEA emphasizes that countries must do everything possible to limit the overshoot by cutting emissions faster now. Notably, in the NZE pathway, global emissions fall by more than half by 2035 and reach net zero by 2050.

By the end of the century, carbon removal technologies would need to eliminate nearly four gigatonnes of CO₂ each year to bring temperatures back down.

A Fossil Peak Nears as Clean Energy Surges — but the World Still Falls Short

The IEA shows the energy system shifting, with coal already at or near its peak and oil expected to peak around 2030, though its decline will be slower than once expected. Gas demand levels off around 2035, but at a higher baseline than earlier forecasts, revealing how deeply rooted fossil fuels remain in the global mix.

At the same time, clean energy is rising fast. Solar capacity could more than triple by 2035, wind is set to nearly triple, and nuclear expands by close to 40 percent. Renewables will even overtake oil as the largest energy source by the early 2040s. Yet the world is still not moving fast enough. Under stated policies, renewable capacity reaches about 13,700 gigawatts by 2035, far short of the roughly 19,600 gigawatts required under the net-zero pathway.

ALSO READ: How EV Adoption is Reshaping Global Oil Demand: IEA’s 2025 Outlook and 2030 Forecast

Global Carbon Emissions: Peaks and Plateaus

Both IEA scenarios point to sustained high emissions, though at different levels. In the CPS, global energy emissions stay near 2024 levels through 2050, as small coal reductions are offset by rising oil and gas use. In the STEPS, emissions peak soon, drop to 35.2 gigatonnes by 2035, and decline slowly to 2050.

Reductions in advanced economies and China are balanced by rising emissions in developing regions. The gap between CPS and STEPS comes mainly from higher coal emissions, slower industrial efficiency, and delayed adoption of electric and efficient vehicles.

All in all, this gap underscores the need to accelerate clean energy deployment to align with global climate goals.

Why COP30 Matters More Than Ever

With the world heating faster than expected and the 1.5°C threshold already breached annually, COP30 becomes a turning point. The IEA’s outlook directly shapes negotiations because it:

Shows the world is far off-track.
Highlights the widening gap between political promises and real action.
Makes clear that overshoot is now unavoidable.
Warns that delay will force much heavier reliance on expensive CO₂ removals later.

At COP30, countries need to submit new Nationally Determined Contributions (NDCs). The IEA warns that current NDCs do not reflect the full potential of national policies or domestic clean energy momentum. In other words, many countries are doing more at home than they are willing to commit to on paper.

COP30 is a chance to fix this gap.

What Can Be Done to Get on Track? The IEA’s Priority Actions

The message is clear: the world is not on track, and the window to avoid the worst climate impacts is shrinking. Still, the IEA shows that meaningful progress is underway.

It highlights several actions that could quickly bring global emissions closer to the NZE path. The world needs faster renewable energy deployment, stronger energy efficiency improvements, and large reductions in methane emissions from the energy sector.

Electrification of vehicles, buildings, and industry has to accelerate, and sustainable fuels such as biofuels and hydrogen must expand significantly. These steps are well understood, often cost-effective, and achievable with current technology. What remains missing is the political will to scale them up at the speed required.

With COP30, countries certainly have an opportunity to match ambition with action and take decisive steps toward a safer climate future.

ALSO READ: From Baku to Belém: Can COP30 Deliver the $1.3 Trillion Climate Finance Pledge?

The post What the IEA’s New Scenarios Mean for the Global Climate — and for COP30 appeared first on Carbon Credits.

Carbon Footprint

How to improve Scope 3 data accuracy for CSRD

Published

15 hours ago

July 17, 2026

Alice Rush

For most businesses, the emissions that matter most sit outside their own walls. Scope 3 emissions, everything generated across your value chain, from the suppliers who make your inputs to the customers who use your products, typically make up the majority of a company’s total carbon footprint. Under the Corporate Sustainability Reporting Directive (CSRD), those value-chain emissions now have to be measured and disclosed with a rigour that spend-based estimates alone struggle to satisfy. This guide sets out how to improve Scope 3 data accuracy for CSRD: the calculation methods open to you, how to move from estimates to verified supplier data, and how to govern that data so it holds up to audit.

Carbon Footprint

How community stewardship makes carbon credits durable

Published

21 hours ago

July 17, 2026

Alice Rush

A carbon credit is a commitment that extends well into the future. The tonne of CO₂ compensated for today from a nature-based carbon project must remain out of the atmosphere for good, which means the forest behind the credit has to remain standing long after the transaction is complete. For any buyer, this raises a defining question: What ensures that the forest endures?

Carbon Footprint

Why Conventional Carbon Offsets Are Losing Boardroom Credibility

Published

3 days ago

July 15, 2026

Alice Rush

What replaced the cheap REDD credit on the boardroom slide deck, and why procurement is leading the rewrite.

Three years ago, a corporate slide showing a portfolio of cheap REDD+ credits could carry a board meeting. The number was big, the price was low, and the press release wrote itself. Today, that same slide gets sent back with questions. The questions are uncomfortable, the answers are unclear, and your general counsel is suddenly in the room.

Conventional carbon offsets are not dead. The voluntary carbon market retired 202 million tonnes in 2025, and the Morgan Stanley Institute for Sustainable Investing survey published in January 2026 confirmed that interest from corporate buyers remains substantial. What changed is the credibility threshold. The integrity floor has risen, the disclosure scrutiny has tightened, and the buyer profile has shifted. This article tracks what changed, what sophisticated buyers now ask before signing, and what serious corporates are putting on the board slide instead.

What boards used to buy, and why it stopped working

The 2020 to 2022 model was simple: buy a large tranche of avoidance credits at low single-digit prices, retire them against the company footprint, announce the carbon-neutral claim, and move on. Most of those credits came from REDD+ projects, renewable energy installations in countries where the renewable energy was already economic, or methane projects with thin documentation.

Several things broke that model. Academic research published in 2023, including a widely cited Science paper, found that the majority of REDD+ credits issued under the most common methodologies did not represent additional reductions when tested against rigorous counterfactuals. The Voluntary Carbon Markets Integrity Initiative published its Claims Code of Practice, which sets requirements for what companies can credibly claim from credit use. The European Union finalised its Green Claims Directive, restricting how companies can describe products as climate-neutral. France’s Décret 2022-539 already restricts carbon neutrality advertising. California’s AB 1305 imposes disclosure requirements on any company making net-zero or carbon-neutral claims while doing business in the state.

The collective effect: the cheap credit no longer buys the announcement, and the announcement now carries litigation risk.

The integrity reset: ICVCM, VCMI, and what changed

The Integrity Council for the Voluntary Carbon Market published the Core Carbon Principles in 2023 and began assessing methodologies against them in 2024. The first methodologies received the CCP label later that year. The point of the label is to give corporate buyers a defensible quality screen they can cite in disclosure.

The Voluntary Carbon Markets Integrity Initiative complements this on the demand side. Its Claims Code of Practice defines what a buyer can say (Silver, Gold, or Platinum claims, with associated requirements) based on the quality of credits used and the underlying decarbonisation strategy. Together, CCP and VCMI build a quality stack: CCP on the supply, VCMI on the claim, with the science-based target sitting underneath both.

The reset is not a ban on offsets. It is a ratchet. Credits that meet the new bar continue to clear; credits that do not, do not. The Morgan Stanley survey found that 61% of current buyers like the CCP label concept but that supply of labelled credits remains limited. That supply constraint is now visible in pricing.

What sophisticated buyers ask before they sign

The questions on the procurement scorecard have changed. A 2022 buyer might have asked about price, vintage, and project type. A 2026 buyer asks five different questions before any of those.

What does the counterfactual look like, and who validated it.
What is the permanence regime, and what is the buffer pool exposure.
What is the leakage risk, and how is it mitigated.
What rating has the project received from the independent ratings agencies (Sylvera, BeZero, Calyx Global), and what was the rationale.
What is the documentation discipline that survives an audit four years from now when the procurement team that signed the contract has moved on.

If the vendor cannot answer those five questions on a first call, the conversation ends. Conversely, if the vendor can answer them with documented specificity, the conversation often expands beyond a single transaction toward a multi-year engagement.

Where this leaves your near-term commitments

You probably have near-term commitments that pre-date the integrity reset. Public targets to be carbon neutral by 2025 or 2030. Product-level claims that ran in last year’s marketing. Disclosed reduction trajectories that assumed continued access to cheap credits.

You have three workable paths. The first is to re-baseline your strategy, replacing the most exposed credits with higher-quality alternatives and adjusting the public language to match what you can defend. The second is to shift the underlying spend from offsetting outside your value chain to investing inside your value chain, where reductions count against Scope 3 directly and the audit trail is cleaner. The third is to keep the strategy and absorb the risk, which is increasingly the most expensive option once you price in litigation, restatement, and reputational exposure.

Most serious buyers are choosing the second path. It moves the carbon spend from a compliance cost to a procurement and resilience investment, and it removes the central failure point of the legacy model: the disconnect between where the emissions occurred and where the reductions sat. Nature-based supply chain investments, structured under the GHG Protocol Land Sector and Removals Standard and aligned to the SBTi FLAG Guidance, are the asset class that fits this brief. They generate inventory-grade reductions, they produce audit-grade documentation, and they survive the new claim restrictions because the carbon math sits inside the value chain that the disclosure already covers.

If you are reassessing a carbon strategy under the new integrity bar, or rebuilding a board narrative that has to survive a more skeptical audience, the carbon and sustainability experts at Carbon Credit Capital can help. The Dual-Value Model gives you a defensible alternative to legacy offset purchases, with the documentation and operational integration that survives the procurement scorecard and the audit. Schedule a consultation.