But what exactly is the Low-emissions Scenario, and why does Statkraft have it?
Every year Statkraft develops various future scenarios for energy systems. The scenarios are part of the work done on preparing the long-term price forecasts (LPF) that form the basis for decision-making in the company.
For the first time, Statkraft has extracted the main findings of one such scenario, the Low-emissions Scenario, and made them available outside the company.
"We do this to inform, and because we want to be relevant in the debate," explains Senior Adviser Mari Grooss Viddal in Public Affairs.
"The Low-emissions Scenario is an interdisciplinary collaboration between several business areas in Statkraft, and is based on our own analyses and external sources."
The scenario is one of several analyses of the global energy sector.
"There are many external sources, some of which are very optimistic about reducing greenhouse gas emissions, while others are more conservative and just extend the current situation, one example of which is the IEA New Policy Scenario," she says.
"The Low-emissions Scenario tries to balance these perspectives and illustrates an optimistic, yet realistic, future scenario for technology development and greenhouse gas emissions from the energy sector."
The Low-emissions Scenario is based on an assumption that in the coming years the world may enter a positive spiral whereby the technological, market and political developments mutually reinforce each other.
"As we see it, a possible outcome is that the global technology trends we are now observing will continue to gain momentum and that climate policy will gradually be strengthened," says Viddal.
A main finding is that the entire increase in electricity demand from today until 2035 can be covered by emission-free power generation.
The global climate agreement signed in Paris in 2015, commits most countries in the world to reduce greenhouse gas emissions. The countries have a common goal to limit the global temperature increase to below 2°C above pre-industrial levels.
"The Low-emissions Scenario is based on the expectation that the cost of solar, wind power and batteries will continue to fall at the same rapid pace as in recent years," she says.
"Lower costs of renewable technologies combined with political pressure will lead to less consumption of fossil fuels and thereby reduced greenhouse gas emissions. But the reduction in emissions is still not strong enough to get us to the two-degree target."
Falling battery costs will, according to the Low-emissions Scenario, lead to electric vehicles becoming globally competitive without subsidies by the middle of the 2020s. This will contribute to increased electrification in the transport sector.
"This will obviously vary from country to country and for different types of vehicles, but overall the scenario forecasts a 78-per cent increase in electricity demand from increased electrification in the transport, industry and buildings sectors," says Viddal.
In December 2015 a global climate agreement was signed in Paris. The Paris Agreement has a common goal to limit the global temperature increase to below 2°C above pre-industrial levels.
In the recent decade, global energy consumption has increased faster than ever before because of population and wealth growth. The increase has largely been covered by fossil energy sources. Global energy consumption is still growing, but growth towards 2035 will be lower than previously forecasted, driven by more energy efficiency.
"The Low-emissions Scenario differs from many other energy market analyses by assuming a stronger electrification of energy use for transport and heat, more energy efficiency and increased development of wind and solar," says Viddal.
"The scenario forecasts that 29 per cent of the world's primary energy consumption will come from renewable sources by 2035, compared with the current 13 per cent. A main finding is that the entire increase in electricity demand from today until 2035 can be covered by emission-free power generation: solar, wind, hydropower and some nuclear."
Electric vehicle share of global passenger car sales will be 40% by 2035 according to the scenario, an increase from 0.5% in 2013.
Statkraft presented the Low-emissions Scenario during "Arendalsuka" in August 2016, a forum for Norwegian politicians and business representatives.
"By sharing our knowledge, we can contribute to the debate on future energy systems, increase awareness of electrification and show that a more optimistic approach is realistic," says Viddal.
Text: Sissel Fantoft
Illustrations: Mona Holm
The article has also been published in Statkraft's magazine People & Power no. 3/2016.
Statkraft's Low-emissions Scenario looks at the global energy mix and greenhouse gas emissions for the world's energy systems towards 2035.
> The rate of growth in renewable technologies will continue as in recent years, driven by a continued sharp decline in costs and a stronger climate policy.
> Global power consumption will increase by 2.6 per cent annually during the period, primarily as a result of electrification in transport, buildings and industry.
> The entire increase in power consumption will be covered by emission-free power generation.
> Fossil power generation will drop by 12 per cent during the period. Coal consumption will fall by 33 per cent by 2035 from current levels. Oil consumption will level off at current levels by 2025, and decline thereafter.
13. Dec. 2016