We know that we need a zero-carbon economy and we know that it is technically possible. We know that stopping the burning of fossil fuels is one of the biggest steps we need to take. We know that the shift to renewable electricity is happening faster than anticipated. But for all the progress we see, can we get to zero-carbon fast enough?
A new report from Sandbag finds that the European Union has the policies in place to more than halve its emissions by 2030. The power sector has been an important driver of this change, accounting for half of the EU’s emissions cuts from 2018 to 2030 as coal is replaced with renewable. Good policy has meant that renewable technologies that were immature and expensive only a few years ago are now cost competitive (Meet our Network: Rasmus Skov Ørsted).
Bloomberg New Energy Finance finds that the cost of batteries has been declining so rapidly that not only are solar and wind plans now significantly cheaper than coal, but in some instances renewables plus battery storage are even cheaper than natural gas. There is even confidence that reaching net-zero emissions from the hardest to abate sectors (e.g. heavy industry and shipping, aviation, road freight) is technically and financially possible by 2050 in developed countries (In Focus: Hard to Abate Sectors).
So, yes – there are some reasons for optimism. But this optimism needs to be tempered by recognition of the sheer scale of the task.
While the renewable revolution is welcome it is important to remember that nearly 80% of primary energy is still derived from fossil fuels. Much of this energy is deployed in hard to abate sectors. Couple that with the forecasted growth in energy demand as populations increase and low- and middle- income countries develop and the challenge becomes more acute.
The sheer scale of the oil and gas majors means that stock markets everywhere continue to be underpinned by the sector. For example, here in the UK, BP and Shell are two of the largest companies in the FTSE100, making up just under 20 percent of the index. They are making progress – perhaps even faster than we thought they could. But revenues hinge on oil and gas and most people with any investment or pension product is dependent upon the sector’s financial performance. The need to “stop burning fossil fuels” and to “keep it in the ground” is easy to say but the monumental amount of capital investment, not to mention the level of employment in this supersized part of the economy makes it devilishly difficult to move as fast as the situation demands.
We hear repeatedly that investors are starting to get it and there are some welcome signs of progress. But investors are failing to act consistently. As this report from 5050Climate shows some of our biggest asset management firms are failing to hold carbon-intensive companies accountable on climate change.
Looking in another direction, the Gilets Jaune have shown us that we need better understanding of how transition costs will be minimized and benefits equitably shared (Research: Engagement for A Just Energy Transition). The French government was warned ahead of the protests that its measures risked social disruption and that vulnerable segments of society could well be most affected. But it went ahead. A misstep by the French authorities? Yes, but also a clear demonstration that pricing mechanisms to drive change are difficult to execute. With our politics in such a destabilised and fragile state at present, is there the will and the capacity to think these shifts through?
A lack of hope leads to a lack of agency, but there is hope (Meet our Council: Diana Liverman). There are fresh ideas and possibilities combining the best of nature, of us and of tech that “could” make the difference.
Firstly, we need to understand the problem better. And here Shell deserves credit for its Sky Scenario. This sets out an ambitious but achievable pathway to securing an increase of no more than 1.5degrees and meeting the world’s forecasted energy needs (Immediate, Serious: Rising to the Climate Challenge).
Paul Hawken’s Project Drawdown lays out the 100 most substantive, existing solutions to address climate change. Each solution on its own not that significant, but together they mark a fundamental change in how we need to operate, beyond a shift to renewables.
A group of scientists and activists are urging us to see the potential in natural climate solutions. We know that we need to take carbon out of the atmosphere. Carbon capture and storage will play a part, but costs are high and the infrastructure impactful. Natural climate solutions – drawing carbon dioxide out of the atmosphere by protecting and restoring forests and other valuable ecosystems – thereby addressing two our biggest challenges: climate and ecological breakdown.
Technology must play a role, especially AI and digitisation. We need to continue to ensure that digital technology is adequately focused on addressing the world’s most pressing problem and work to bridge the gap in knowledge and understanding between the worlds of tech and sustainability.
In sum, we need a better appreciation of the challenge at hand, we need to appreciate progress where we see it – especially from incumbents, without losing sight of the journey ahead, and we need radical thinking to accelerate.