The Paris Agreement, signed by every nation on the planet in December 2015, proved to be a turning point for the climate fight. But it almost did not happen. One of those who made it possible was the energy analyst Fatih Birol.
On 13 November of that year, terrorists in Paris killed 130 people in bombings and shootings. It was the bloodiest day in France since the Second World War, and it was only two weeks before the start of UN climate talks where 40,000 attendees were expected. Crucially, it happened a mere three days before a high-level meeting of energy ministers.
Birol, a Turkish economist, was then newly appointed head of the International Energy Agency, and he was going to lead the meeting of the ministers. He planned to make the case to all nations that the solution to climate change lay in how we use energy, which causes more than three-quarters of all planet-warming emissions. And he hoped to broker an agreement on moving to clean energy among the ministers from twenty-nine countries, which made up nearly 40% of all global energy consumption. If he succeeded, it would provide the crucial momentum needed at the climate talks to come in the following days.
Even if the terrorist attack hadn’t happened, it would not have been easy to get countries like France, which had very few coal power plants, and Turkey, which heavily relied on coal, to agree on ways to reduce energy emissions. But if there was any chance of reaching an agreement, it would necessitate getting all the ministers in one room to thrash out the details.
After the attack the French government declared a state of emergency. That meant any meeting of international delegates would require a lot more security at a time when the country’s security apparatus was being stretched to its limits. The meeting seemed like it may not happen.
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But Birol worked closely with the US to get France the security assistance it needed and convinced the French government of the importance of the meeting, despite the horrific photos plastered across newspaper front pages. It would be one among many high-profile, behind-the-scenes diplomatic wins Birol would score as he worked to put the might of the IEA behind transitioning to cleaner sources of energy.
‘Without fixing the problems of the energy sector, the world has no chance whatsoever to solve the climate problem,’ Birol said. ‘I have a big responsibility as the head of the IEA to lead the global energy system in a sustainable way. This is the one and only reason I’m doing this job.’
For most of its existence, few people knew about the IEA outside the energy industry and high-level politicians. The agency’s main focus is publishing heaps of reports – often many in a month – that lay out the state of affairs affecting global energy security. The technical reports, produced by the IEA’s army of number crunchers, feed into government decisions that mostly don’t make the news headlines but keep the world churning.
But Birol’s proclamation that the IEA would now support the energy transition was a big turnaround for an organization steeped in fossil fuels. For the first four decades of the IEA’s existence since being founded in 1974, the focus of its reports was carbon-based fuels, especially oil. The fuel drove (and often can still drive) global economies and big-game geopolitics. The IEA’s role was to serve its oil-consuming members, mainly Western economies, in tackling the ups and downs of that market.
In the 2000s, as the world began to seriously consider how to wean itself off those dirty fuels, there didn’t seem to be any international organization capable of doing what the IEA did for the fossil fuel era. Thus in 2009 the United Nations created the International Renewable Energy Agency (IRENA) to publish reports on new, clean sources of energy and set up global meetings that would push countries to lower emissions.
As Birol pitched for the top job at the IEA, in 2014, he realized that the agency’s mandate would have to expand if its pronouncements about the energy world were to remain influential. Solar and wind power prices were falling more rapidly than many experts had predicted, including those at the IEA. The era of cheap batteries and green hydrogen was on the horizon.
IRENA’s reports were a welcome addition, but Birol realized that they weren’t providing the systemic view an agency looking at the entire energy sector could. In any case, the two institutions weren’t on an equal footing. IRENA had been born inside the UN, which meant its membership included all countries in the world. That gave it the power of having a bigger base of popular support when it came to finding a consensus, but the bureaucracy needed to secure agreements among so many members typically meant acting more slowly.
In the 1970s IEA burst out of a cauldron of crisis directed by a few of the richest and most powerful countries to help them not be crushed by oil markets that had been hijacked by the Arab countries. Ever since, its mandate of energy security has tended to rank higher on most countries’ priority lists than the decadal threat of climate change. That’s allowed the IEA to build close ties with old, powerful energy ministries among its member countries, while IRENA works alongside newer, less powerful ministries created to support clean energy and the environment.
Birol also spotted an opportunity in the limitations of the UN system. He had seen how the UN’s annual climate gathering, called the Conference of the Parties, was often too cumbersome to make real progress. Any COP deal needed a consensus among all the nearly 200 countries in the world. Perhaps the IEA could fill a gap by getting its few but powerful members to come to an agreement first, which could ease the process at the COP meetings later.
The IEA shows how international institutions can rebuild to become fit for the climate era, and why many must go through such a transformation to remain relevant in the twenty-first century. Many intergovernmental institutions will play a major role in accelerating, or hindering, the transition. That’s because, even though every country needs to reach net-zero emissions within decades to avoid climate disaster, each has different strengths and weaknesses and thus will need support from across borders to meet that goal.
The IEA’s origin story continues to shape it even today. The 1960s saw a rapid increase in the use of cheap oil across Western countries. Cars in the US, for example, grew larger and heavier, reducing their fuel mileage. Nearly two-thirds of that increased oil demand was met by the Arab members of OPEC. It gave those countries extraordinary power to make use of what came to be known as the oil weapon, which was deployed, to great effect, in 1973, when a group of Middle Eastern countries that were members of OPEC stopped exporting oil to a handful of European countries and the US. The embargo came in retaliation for those nations’ support of Israel in a regional war against Arab countries. It caused oil prices to spike and created a real risk of the commodity running out altogether in the West. That could have led to public protests and huge political backlash.
Western powers recognized that such a weapon could exist only because of coordinated action among OPEC members. The only way to make it ineffective would be to have a coordinated response. They had to get creative to build a new international organization that could quickly ready such a response. In 1974 the IEA was born under the existing framework of the Organisation for Economic Co-operation and Development (OECD) – whose membership is comprised of mostly rich Western countries – thereby avoiding the need for another international treaty to be signed. The IEA’s immediate mission was to ensure oil-consuming Western countries could always have access to the fossil fuel and at reasonable prices.
The organization proved crucial in creating ‘strategic petroleum reserves’ – enough oil stored within borders to last up to ninety days – in many IEA countries. When periods of chaos inevitably came, such as the Gulf War in 1990, investing in the IEA paid off for members as they saw a damping down of volatility in the oil markets and a lowering of the negative impact on oil-consuming countries’ economies.
Such a coordinated response required a freer exchange of energy-related information with the IEA. That’s how the agency built up its number-crunching prowess, as it carefully assessed how members were using energy and from where the fuels to provide that energy were being sourced.
This unique expertise enabled the IEA to start creating scenarios of what the future of energy could look like. And as it grew its membership over the decades that followed so it developed its data-hoovering capacity and ability to forecast the next stages of the global energy markets. But the twenty-first century brought in new, decidedly different energy challenges, and that future-gazing power started fading. Indeed, when the UN created IRENA, in 2009, it was as a counter-force to the fossil fuel bias of the IEA.
It took another five years for IEA members to finally wake up to a new global energy reality: when Russian troops invaded Ukraine and annexed Crimea in 2014, it caused panic among European countries that received a large share of Russian natural gas through pipes in Ukraine. That led the Western powers in the IEA to finally approve an expansion of the organization’s energy security mandate to include not only global gas markets but also a recognition of the changing nature of energy to add threats to the power sector including those wrought by climate change.
It was also when the IEA’s member nations promoted Birol, then the agency’s chief economist, to lead the organization into the modern era. Given that the agency’s previous six chiefs were all government bigwigs, elevating the chief economist to the top job may have seemed like electing the maths club president to prom king. But the logic was sound.
A degree in power engineering and a doctorate in energy economics landed Birol a job at OPEC as an oil market analyst at the start of his career, in 1989.[iii] The IEA hired him in 1995. He would go on to play a pivotal role in developing the organization’s marquee product, the annual World Energy Outlook (WEO), which uses exclusive access data secured directly from governments to project energy supply and demand for years to come. The two skills he needed were facility with numbers to explain what the complex models say and the ability to build relationships across geographies and cultures to get diplomats on his side.
‘He’s one of the best communications experts I’ve ever worked with,’ says Brian Motherway, head of energy efficiency at the IEA. This isn’t just praise you’d shower because Birol’s your boss. Few people I’ve seen have the capacity to hold the attention of an audience and make sense of numbers around dry and abstract energy statistics with as much ease as Birol does.
Birol has white hair and black eyebrows. Although he has spent nearly three decades living in Paris, he still has a Turkish lilt to his English. He doesn’t look or sound like the typical Western energy expert. But he uses his not-part-of-the-club demeanour to full advantage. For example, he throws into conversations his love for the Turkish football club Galatasaray or some Turkish saying, to bring to life drab details about energy. It’s his way of saying, I may not know your culture, but there are enough things in common between us to have a dialogue. As US Energy Secretary Ernest Moniz put it, Birol is ‘very sensible in how he listens, how he talks to people, gets help, gets allies, builds up consensus to allow him to step out.’
While the rhetoric matters, it’s nothing without substance. The strength of its data is what gives IEA its ‘backbone’, Birol says, and what enables the organization to have productive relationships and wield influence globally. ‘Friendship is not only when they like you – as we say in Turkish – because of your beautiful eyes,’ he says. ‘But because you take the right position and you have a backbone.’ It is these friendships – built on numbers and facts – that have helped Birol undertake the most consequential transformation of the IEA: from caring only about carbon underground to beginning to care about carbon everywhere.
Extracted from ‘Climate Capitalism: Winning the Global Race to Zero Emissions’ by Akshat Rathi. Published by Hachette India/John Murray.