Welcome back. Fossil-fuel demand could peak this decade, the International Energy Agency said Thursday, bolstering the case for companies aiming to reach net-zero greenhouse-gas emissions.

If countries fulfill the policies they have set in motion, natural-gas demand will plateau by the end of the decade, with oil demand doing so in the mid-2020s and coal following in the next few years, according to the latest forecasts from the IEA, which advises nations on energy policy.

Speeding up the energy transition is the war in Ukraine that cut Russia’s oil-and-gas flow, which added to turmoil in power markets and spurred European governments to demand more renewables to improve their energy security. This year also has seen extraordinary government-spending commitments to curb climate change, particularly under the Democrats’ climate bill that earmarked some $369 billion for energy and the environment.

Based on current government policies, global emissions may reach their height in 2025 thanks to gains in renewable energy and support from nuclear power, the IEA said.

Corporate sustainability analysts say the forecast aids companies charting a course to net zero by 2050 or sooner. At least 800 of the world’s largest 2,000 publicly traded companies by revenue have released net-zero targets, according to Net Zero Tracker.

“Companies building net-zero value chains should take heart that the tailwinds for renewable energy will become ever stronger,” said David Wei, managing director at sustainability consultancy BSR. “And companies which rely on fossil fuel inputs like oil should accelerate research and investment into alternatives as they begin business transformation towards net zero.”

Even though some companies have had to turn to fossil fuels in the short term due to the energy crisis, the IEA’s outlook strengthens the case for decarbonization strategies, said Daniel Litvin, senior adviser to the executive committee at sustainability consultancy ERM.

The outlook may lead companies to tighten their interim targets on the path to net zero, which businesses often set for 2050 or 2040, said Amlan Saha, managing director at Engie Impact, which is owned by French utility Engie SA and consults with companies on their renewable-energy plans.

The IEA also said more money is needed to reach net zero by 2050. The watchdog reported that clean-energy investment is on track to rise above $2 trillion a year by 2030, but it needs to rise to above $4 trillion by the same date to reach net-zero by 2050.

“It is essential to bring everyone on board, especially at a time when geopolitical fractures on energy and climate are all the more visible,” IEA Executive Director Fatih Birol said.

This week: Apple presses suppliers to decarbonize; Global climate-change action not enough, U.N. says; Banks and U.N. group clash

Apple is dialing up pressure on its suppliers. The iPhone maker said it would start tracking the progress of its manufacturers, which are mostly overseas, to decarbonize the production of its goods. Analysts say companies like Apple with sprawling global supply chains are bogged down by disparate climate goals around the world and a lack of access to renewable energy in markets such as China.

Close to 30% of Apple’s suppliers, as measured by the company’s direct spending on manufacturing, haven’t committed to using 100% renewable energy to power the production of the company’s goods. In 2020, Apple set a goal to reach carbon neutrality across its entire business by 2030, aiming to cut emissions by 75% and develop carbon-removal projects for the remaining 25% of its footprint.

U.S. emissions are on track to decline thanks to recent legislation, but the world’s climate goals are still falling short. Those findings are from the U.N.’s latest report on the contributions of signatories of the 2015 Paris Agreement published Thursday.

The gap between cuts pledged by 166 nations, including the U.S., and their current emissions puts the world on track to warm 2.5 degrees Celsius by the end of the century, well above the Paris Agreement’s ambition of 1.5 degrees. Nations still need to cut 45% of their fossil-fuel use by 2030 to hold warming at 1.5 degrees, the U.N. said.

An uprising by banks in a United Nations-sponsored climate coalition has been quelled but opened wounds that could weaken an alliance meant to funnel trillions of dollars to fund the transition away from fossil fuels. Getting banks to sign on to the coalition was a marquee achievement of the U.N. climate conference in Glasgow. Since then, fuel shortages and pressure from politicians and regulators led banks to push back against what they thought were tighter rules.

Some banks regret joining the group, known as the Glasgow Financial Alliance for Net Zero. The group will likely survive, but its impact could be limited as diplomats head to Egypt next month for the U.N.’s next climate conference.

Join us on Nov. 9 for a webinar discussion about advancing supply-chain sustainability. Speakers include Sandra MacQuillan, executive vice president and chief supply chain officer at Mondelez International, and Ravi Anupindi, professor of operations and management at the Michigan Ross School of Business. Sign up here.

China needs $25 trillion to reach net zero by 2050. (South China Morning Post)

Investors representing $37 trillion are campaigning for companies to align with the 1.5 degree pathway. (CDP)

The EU’s focus on energy prices could undermine climate goals. (Financial Times)

Bacardi is ditching plastic pourers in its bottles. (Recycling Today)

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