The United Nations climate change conference (known as COP26) in Glasgow, Scotland, was billed as historic. By that measure, the conference didn’t deliver. But it nevertheless marks a moment of transition. Glasgow completed the process begun at the 2015 Paris conference, under which nations progressively raised their national commitments to decarbonization. All the major economies of the world are now notionally committed to reaching net-zero emissions between 2050 and 2070. As a result, Glasgow also marked the moment when climate politics began to focus on the energy transition as a matter of industrial policy. It was symptomatic that a prominent commitment to reduce coal burning was included in the final resolution. It was not enough, but it was a significant first. It was also symptomatic that Britain’s conservative government put the emphasis on businesses. That dismayed many activists, but it was a prompt eagerly seized on by U.S. climate envoy John Kerry.
Kerry finished the conference hailing an impending transformation. Firms that were willing to innovate and gamble on the energy transition would be opening up the “greatest economic opportunity since the Industrial Revolution,” he said. In a Financial Times op-ed published in November, Kerry added: “Like the proverbial cavalry, the first movers [in business] are coming. … Companies should seize this opportunity by propelling the shift—rather than being buffeted in its wake.” Meanwhile, in the New York Times, columnist Thomas Friedman chimed in to declare if we are looking to save the world, “we will get there only when Father Profit and risk-taking entrepreneurs produce transformative technologies that enable ordinary people to have extraordinary impacts on our climate without sacrificing much—by just being good consumers of these new technologies. In short: we need a few more Greta Thunbergs and a lot more Elon Musks.”
One can see this vision’s attraction for the likes of Kerry and Friedman. Rather than the subject of contentious politics, climate policy has become a business opportunity. But is this realistic? There is certainly compelling evidence to believe powerful economic and technological imperatives are beginning to drive the energy transition. But it would be naive to imagine this means the politics is settled. Precisely in the United States, the energy transition threatens to trigger a dysfunctional backlash that could leave the champion of the hydrocarbon age stranded in the 20th century.
Diesel trucks and cars pass windmills near Banning, California, on Dec. 8, 2009. David McNew/Getty Images
Since the beginning of global climate policy in the 1990s, the United States has been marked by a conflicted position. To explain this, it is easy to point the finger at the Republican Party or former U.S. President Donald Trump’s crude climate denials. But it goes far deeper than that. From the beginning, America’s huge energy consumption made it a target for those demanding immediate action to halt the climate crisis.
It was little wonder Congress resisted any climate agreement that did not enroll the rest of the world on equal footing—and thus rejected the 1997 Kyoto Protocol. Whatever the merits of climate justice arguments, they cut little ice with defenders of the American way of life. Meanwhile, the United States’ energy producers stand firm as a recalcitrant defensive lobby. U.S. oil interests were among the leading sponsors of denial. Since the 1980 Carter Doctrine, U.S. geopolitical power has focused on securing control of the Persian Gulf. It was not for nothing that in the early days of climate policy, the United States featured as the great Satan.
Given this underlying balance of interests, the GOP’s position of denial at least has the merit of consistency. Given the United States’ existential entanglement with fossil fuels, it is easier to strike a patriotic pose if you assume away the climate crisis or trust that technology will deliver the solution by itself. It is Democrats who find themselves in a conflicted position, seeking to square the realities of America’s political economy with the climate threat’s urgency.
The Obama administration midwifed the Paris Agreement while, at the same time, permitting the increased export of U.S. oil and gas. Trump was the first U.S. president to actively deny the reality of the climate problem. For him, all that counted was the country’s “energy dominance” be secured by the export of U.S. liquified natural gas—or “molecules of U.S. freedom.” With U.S. President Joe Biden’s administration, cognitive dissonance returned. Biden supports climate leadership and made a constructive contribution to the Glasgow negotiations while licensing oil and gas development and goading OPEC into increasing its production.
One could simply denounce the hypocrisy, but that misses the point. The root of the incoherence lies in political economy: the United States’ dual role as a huge consumer and producer of fossil fuels as well as the policeman of the world’s oil and gas supplies. It is this that gives real significance to Kerry’s vision of change sketched in Glasgow’s wake. If we take Kerry at face value, we may be about to witness the curtain coming down on America’s fossil fuel century, less as a result of political choice than simply the result of technological and industrial transformation.
But it will take more than billionaire Elon Musk and his ilk to concertedly decarbonize the United States. The question of politics cannot be wished away.
An Indian security officer poses for media as he walks over rooftops covered in solar panels at the Solar Photovoltaic Power Plant near Amritsar on May 17, 2016. NARINDER NANU/AFP via Getty Images
A sketch map of the forces shaping the new energy landscape was provided in the weeks prior to COP26 by an ambitious paper in Nature Energy. The multi-author team, led by Jean-Francois Mercure, explored how the development of a variety of technologies and underlying cost conditions in the energy sector might change output, investment, and employment in 43 sectors and 61 regions of economic activity around the globe.
To predict key renewable technologies’ development path, the authors assume they will follow the same pattern of diffusion and adoption exhibited by other major technologies over the last century. This traces an S curve. Technologies begin small before hitting a period of rapid and comprehensive adoption followed by saturation. This is the trajectory followed, for instance, by smart phones since 2008. If we make that assumption, then as far as renewable energy technologies are concerned, we are currently at the slower end of the curve and about to experience takeoff.
“Through a positive feedback of learning-by-doing and diffusion dynamics, solar photovoltaics becomes the lowest-cost energy generation technology by 2025-2030,” the study says. “[Electric vehicles] display a similar type of winner-takes-all phenomenon, although at a later period. Heating technologies evolve as the carbon intensity of households gradually declines.”
For energy consumers, this promises huge windfalls. Given the cost curves and existing policies in place, the Nature Energy authors, like Kerry, see an energy transition as something close to an irresistible force. Their work was completed well before COP26. But, as if to confirm their predictions, one of the more dramatic pieces of news from Glasgow was India’s declaration that it would aim for net-zero by 2070. India did this reluctantly. It has long held the position that due to historic responsibility, rich countries should shoulder the burden. But this climate justice position has been increasingly overshadowed by the force of global economic growth. India itself is now the world’s third largest emitter of carbon dioxide. Although India is heavily dependent on coal for power generation—and though as many as 20 million workers depend on coal for their livelihoods—it is foreseeable that renewables’ plunging costs will create a powerful incentive for India to shift. Furthermore, as in China, the threat of pollution adds powerful impetus. To avoid the worst effects of life-threatening smog, hundreds of millions of people in the Ganges Delta are currently under a form of lockdown.
India follows the European Union, China, Japan, South Korea, and Indonesia, which have all committed to net-zero emissions, to be achieved somewhere between 2050 and 2060. That Eurasian shift creates huge economic and technological momentum. In the early 2000s, interaction between Germany’s renewable energy subsidies and the growth of China’s solar industry demonstrated the potential for unintended synergies. In the decades ahead, similar dynamics could unfold on a far vaster scale.
The transition is not a done deal, of course. Along with its commitment to net-zero at COP26, India also demanded $1 trillion in foreign funding over the next decade. That is only reasonable. India is still poor. Its per capita emissions are a fraction of those in the West. A trillion dollars is a lot of money, but it is well within the range that experts assess would be necessary to fund the country’s energy transition. To supercharge the development of renewable energy infrastructure worldwide, between $2.7 trillion and almost $5 trillion per year are needed. The required amount of net new investment is 2 to 3 percent of India’s global GDP per year. By the standards of historic structural change, that is modest. At least for middle- and higher-income countries, which account for 95 percent of world economic activity and emissions, finance should not be a major obstacle. The giant flow of spending is precisely the honey pot Kerry held…
No comments:
Post a Comment