Wed, Jan 01, 2020 - Page 9 News List

Negotiating while the world burns

The world might still win the climate change battle if this year’s COP26 can successfully address opportunities and challenges

By Adair Turner

Illustration: Mountain People

The 2010s may be remembered as the decade when the fight against harmful climate change was lost.

In 2015, at the UN climate change conference (COP21) in Paris, 196 countries agreed to limit global warming to well below 2°C above pre-industrial levels.

However, global greenhouse gas (GHG) emissions have continued to increase, atmospheric concentrations of carbon dioxide are at their highest levels in 800,000 years, and current policies are likely to result in warming of about 3°C by 2100.

Moreover, the COP25 negotiations in Madrid earlier this month ended in failure, with governments squabbling over the value and allocation of “carbon credits” held over from a discredited previous policy regime.

At the same time, however, stunning technological progress during the 2010s makes it possible to cut GHG emissions at a cost far lower than we dared hope a decade ago. The costs of solar and wind power have fallen more than 80 percent and 70 percent respectively, while lithium-ion battery costs are down from US$1,000 per kilowatt-hour in 2010 to US$160 per kWh today.

These and other breakthroughs guarantee that energy systems that are as much as 85 percent dependent on variable renewables could produce zero-carbon electricity at costs that are fully competitive with those of fossil-fuel-based systems.

In addition, it is now clear that even the “harder-to-abate” sectors of the economy, such as heavy industry (including steel, cement and chemicals) and long-distance transport (shipping, aviation and trucking), can be decarbonized at costs which, although significant for any one company acting alone, are trivial in terms of the impact on people’s living standards.

The UK’s Committee on Climate Change in May estimated that achieving a zero-carbon economy by 2050 would reduce GDP that year by no more than 1 to 2 percent. Back in 2008, the same committee, which I then chaired, had estimated a similar cost to achieve only an 80 percent reduction in emissions.

Lower decarbonization costs and growing awareness of climate risks have in turn prompted an increasing focus on the possibility and necessity of meeting the zero-emissions goal by 2050. In July, the UK made a legally binding commitment to meet that objective, and the EU agreed on the same goal earlier this month.

Furthermore, Maersk, the world’s largest container-shipping firm, the Swedish steel producer SSAB and the Indian cement company Dalmia are among the growing number of leading businesses committed to being zero-carbon by 2050 or earlier.

To achieve the Paris agreement’s climate objective, all developed economies must become zero-carbon by the mid-century and could do so at a minimal cost to living standards. Such efforts must also include China.

Beijing is seeking to negotiate at climate-change conferences as a “developing country” in view of its current GDP per capita (in purchasing-power-parity terms) of about US$18,000, or about 40 percent of the EU average.

However, the government’s stated ambition is for the nation to become “a fully developed rich economy” by 2050, with a higher GDP per capita than any European country today. Given the quality of the nation’s workforce, infrastructure and management, and its increasing technological leadership in many sectors, that objective is entirely achievable.

How rapidly China reduces emissions is therefore crucial. The nation currently accounts for almost 30 percent of global carbon dioxide emissions, and its per capita emissions are due to overtake Europe’s declining figure within a few years.

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