A 50 MW photovoltaic solar power station built in Shanxi Province in 2017. Photograph Source: Planet Labs – CC BY-SA 4.0
Early adopters pay a premium for their embrace of innovation. If you bought one of the first electric cars in the United States, you had limited range, long charging times, and very little infrastructure to support you on anything but the shortest journeys. If you’d held out just a little bit longer, you could have spent a lot less money and gotten a lot more vehicle.
Foot-draggers, in other words, can reap a lot of benefits, whether as a result of ignorance (not knowing about a new product), fear (of making a mistake), or strategic patience. But too many foot-draggers could doom innovation.
Public policy is often designed to reward early adopters and light a fire underneath the foot-draggers. During the Biden years, EV buyers could receive a tax rebate, and the administration invested money into the expansion of charging stations. As a result, consumers rejiggered their cost-benefit analyses, and for a short period demand exceeded supply. As more companies went into the EV business, the United States, at least briefly, began to move away from the combustion engine.
The Paris Agreement was supposed to create an overall environment to shape such Green public policies. Unfortunately, the Paris targets were voluntary, which meant that countries could make grand statements of commitment while dragging their feet in reality. The ubiquity of “Green-dragging”—the slow-walking of carbon-reduction strategies—has produced the inevitable results: steadily increasing global emissions, the spiraling costs of loss and damage, and a general skepticism that international cooperation can ever really tackle a problem of such magnitude.
Then along came Donald Trump, who has proudly proclaimed his climate denialism. To the delight of the fossil fuel companies that poured money into his reelection campaign, the president has pledged to extract every bit of oil, gas, and coal from beneath the United States. He hasn’t stopped there. To gain access to every last scrap of extractable value in the world—Venezuela’s oil, Greenland’s minerals—Trump has engaged in truly reckless behavior.
In his riskiest move yet, the American president joined Israel in attacking Iran at the end of February. His rationales were many: to “solve” a problem that had bedeviled presidents going back to the hostage crisis of 1979, to punish the ayatollahs that have taunted him, to upend the politics of the Middle East. But he also dreamed of controlling Iranian fossil fuel assets.
Yet this poorly planned, fitfully executed, and shamelessly promoted campaign has backfired in more than one sense. Iran’s blockade of the Strait of Hormuz, which in turn prompted Trump to blockade the blockade, has boosted the price of oil at the pumps in the United States. And it has pushed countries all over the world to rethink their commitment to the fossil fuels that have been blockaded in the Persian Gulf. The fossil fuels that Trump wants to make more available have instead become more scarce.
Will the Iran war prove to be sufficient to shake the Green-draggers of the world out of their torpor? Much will depend on Asia.
What the War Has Done
Very few countries have insulated themselves from the energy shocks of the Iran War and the double blockade of the Straits of Hormuz. Poorer countries that rely on fossil fuel imports are the hardest hit: rolling blackouts in Bangladesh, fuel rationing in Myanmar, school closures in Pakistan. The rising cost of fertilizer—and the consequent reduction in global food supplies from such developments as the halving of this year’s Australian wheat harvest—will hit poor countries even harder.
You’d think that the countries that have pushed hard to transition to clean energy would be able to breathe easy despite the double blockade of the Strait of Hormuz. But that’s not been the case. Uruguay gets 99 percent of its electricity from renewables, but it still relies on a good deal of imported fossil fuels to supply almost 40 percent of its overall energy needs. Several European countries—Denmark, Portugal, The Netherlands, Lithuania, and Luxemburg, with Spain, Ireland, Germany, and Greece not far beyond—are approaching the magic goal of sourcing their electricity entirely from renewable sources, but they too continue to import considerable amounts of oil and gas for heating and other purposes.
Even countries that produce oil and gas in large quantities have been adversely affected by the war. The Gulf States have faced enormous difficulties getting their products to market—and have also suffered damage to their energy infrastructure from Iranian attacks. The United States, despite an abundance of oil, has seen a substantial increase of prices at the pump. Although it can be considered a “winner” of the Iran war because of the increased demand for its oil and gas, Russia’s windfall profits have been compromised by sanctions and Ukrainian drone strikes on key production and processing facilities.
Until recently, the countries that have dragged their feet in their exit from the fossil-fuel era were largely failing on the environmental front. They weren’t paying the upfront costs of preventing the planet from overheating, either because they didn’t sense the urgency of the situation or they wanted a free ride on an emissions-reduction bandwagon driven and paid for by others. It wasn’t because of outright denial of global warming. Other than the United States under Trump, it is hard to find a government that actively ignores the science of climate change. Still, such countries weren’t making the huge investments necessary—at home or as part of climate justice payments to the Global South—necessary to reduce emissions.
More recently, with the price of solar and wind power along with battery storage dropping precipitously, “Green-dragging” has been economically counterproductive as well. But inertia is a powerful force. An energy transition is more than just slapping a few panels on top of a parking lot or building a couple windmills on top of a mountain. Shifting away from fossil fuels requires a buildout of electricity infrastructure, the introduction of new fleets of electricity-powered public transportation, and the replacement of residential and business heating systems reliant on oil and gas. That not only costs money but requires strategic investments from motivated governments.
China showcases the push-pull dynamic of the energy transition. It has quickly transformed itself into a leader of the energy transition by pushing for adoption domestically—adding more solar capacity each year than the rest of the world combined—and grabbing 80 percent of the global market share for solar panels (as well as 60 percent of the wind turbines). It recently debuted an EV battery that can go for nearly 1,000 mileson a single charge that takes only about 6 seconds. This development alone will transform global transportation.
Yet China is also the biggest emitter of greenhouse gasses and remains heavily dependent on fossil fuel imports. In 2024, for example, China relied on fossil fuels for 86 percent of its energy supply. The country has one foot in the past and one in the future.
Japan is an equally stark example of a “Green-dragger.” To be sure, Japan was a pioneer in energy efficiency from the 1970s on. It was a leading innovator in the global environment movement for several decades. More recently, the government introduced a plan for Green industrialization. But the Iran War has revealed just how little progress the country has made in its energy transition and how domestic roadblocks continue to impede its progress.
The Price of Industrialization
Japan’s post-war economic miracle was fueled by imported fossil fuels. The country produces no natural gas and virtually no oil. Its coal production is negligible.
Not surprisingly, Japan is the second largest natural gas importer in the world (behind China), the third largest coal importer (behind China and India), and the fifth largest importer of oil. All of this imported dirty energy has pushed Japan into the number five position globally for its carbon emissions.
Environmentalism certainly exists in Japan. Thanks to the efforts of environmental movements, the air in Tokyo and other cities is no longer toxic. High-profile cases like the mercury poisoning in the coastal city of Minamata precipitated a campaign to clean up waterways. Japanese programs established some early environmental projects in China in the 1990s.
But change comes slowly to Japan, especially from the top down. Japanese governments have been willing to take risks on technology, but they have also been loath to embrace policies that could potentially disrupt the social fabric.
So, for instance, like the European Union and the United States under the Biden administration, Japan has committed to a government-led transition to clean energy. Its Green industrial plan—the GX Basic Policy—focuses on investments into batteries and semiconductors and is coordinating investments among nearly 750 companies. It recently launched an emissions trading system, Yet none of this will wean the country of its addiction to fossil fuels at anything close to the rate necessary to achieve rapid decarbonization.
Moreover, the country remains wildly optimistic about the ability of technology to compensate for its lack of resolve. For instance, it has invested heavily in “clean coal” technologies. But despite claims that carbon-capture methods or “coal-ammonia co-firing” will somehow make coal power more efficient or more palatable, the thinktank E3G concludes that “decades of ‘clean coal’ promotion have left coal technologies either high-emitting in the real world, or stuck in a perpetual planning phase.”
Ultimately, then, Japan is a serious Green-dragger. Its emissions are falling but not nearly enough to meet even the tepid targets of the Paris agreement. It is heavily committed to natural gas as a “transition fuel,” and that means building up fossil fuel infrastructure. One important development is indeed driving down energy use and emissions: the country’s declining population. But that’s not a development the government is going to promote.
The Costs of War
The Iran war could push the world in one of two directions: doubling down on clean energy or trying to exit the crisis the dirty way.
Much depends on Asia. The region is expected to account for much of the increase in oil and natural gas use in the coming years. It is also responsible for 84 percent of global coal-fired power. “If Asia turns around and says, ‘No, we’re not going to grow with fossil fuels, we are going to grow with electrotech,’ that means fossil fuels will peak, and will peak sooner than we think,” Daan Walter of the think tank Ember told Grist magazine.
Even if it continues to favor fossil fuels at home, China is ready to help the rest of the world move toward clean energy. Because of the Iran War, China finds itself in the enviable position of selling lemonade in a heatwave. As The New York Times reports, lots of countries are buying what China is selling: “Fifty countries, including Australia, India, Egypt and even the United States, have set monthly records for the highest Chinese solar imports.”
Japan, with its history of environmentalism, its embrace of industrial policy, and its track record of technological innovation, could lead the region down the clean-energy path. So far, that’s not happening. As a result of the Iran War, Japanese Prime Minister Takaichi Sanae has pledged to make Japan completely energy self-sufficient—not through a Green transition but with a nuclear step backward. The government has a tailwind on this issue. Over 40 percent of the population supports the restart of nuclear plants—versus around 25 percent against—which is quite the reversal 15 years after the Fukushima catastrophe.
Japan is not alone. China and South Korea are looking to beef up their nuclear sectors. Vietnam and the Philippines are looking into developing the sector.
Nuclear is neutral when it comes to carbon emissions, but it has dirty byproducts of its own (not to mention the risks of future Fukushimas). A case can be made to maintain current nuclear plants to provide energy in the interim while renewable systems are built out. But spending huge sums on new nuclear plants is a recipe for stranded assets.
Perhaps it’s naïve to believe that Japan could again be a leader in the region, this time on clean energy. South Korea has been generally more willing to take risks, such as pledging to phase out coal by 2040, but it too is basically a Green-dragger. Vietnam and India are rapidly adding renewable energy infrastructure, but they too remain heavily dependent on fossil fuels.
The region hasn’t yet adjusted to the new realities created by the Iran War. Countries in Asia, which will determine the future of fossil fuel use, must be a lot bolder. And someone has to take the lead. If conservative, risk-averse Japan responds to the wake-up call of the Iran War to accelerate dramatically its exit from the fossil fuel era, that could indeed inspire the rest of the region to follow suit.
And if that happens, the planet has a real chance to avoid the worst-case scenarios of climate change.
