Thomas Friedman, the legendary New York Times writer has documented his belief that Germany is the world’s first green superpower thanks to its investment in solar photovoltaics has driven down prices to such an extent that they are fast approaching grid parity i.e. they can generate electricity at a price similar to that of the grid.
The leaders of the United States, Germany, France, the UK, Japan, Canada and Italy have stated that they supported cutting greenhouse gases by 40 to 70 per cent by 2050 from 2010 levels — the first time they have backed such a precise long-term target.
For energy companies looking at investment right now, potentially looking at tens of billions of dollars and with a return over decades, the prospect of a G7 commitment taking root must stop time in board rooms; under the G7 commitment demand for fossil fuels could shrink even by 40% within 35 years.
As Jennifer Morgan, Director of the Global Climate Programme at the World Resources Institute, an American think tank said: ‘This long-term decarbonisation goal will make evident to corporations and financial markets that the most lucrative investments will stem from low-carbon technologies.’
Atmospheric concentrations of carbon dioxide are, many commentators say, looking likely to rise to 7,000 parts per million (ppm) by 2100. At the start of the industrial revolution they are around 280ppm and now are at about 400ppm. With 700ppm, the IPCC thinks that the median increase in global temperature will be 3.5 degrees centigrade, not 2 degrees. Nonetheless, many of the major climate NGOs have welcomed the announcement.
Crucially, as Chancellor Merkel said: “We know the G7 countries alone, even if they had no CO2 emissions as of tomorrow that still could not solve the climate problem. Emerging countries such as China would have to make a contribution.”
With this intent governments are going to have to throw the kitchen sink at de-carbonisation. Reducing energy wastage would be a major start. Targets in the automotive industry have already started to see progress in fuel efficiency and CO2 emissions in cars designed in the last two years.
Tidal, nuclear and solar power look to be major beneficiaries – it is difficult to see how the G7 commitments can be met without a great deal of tidal power in countries from the UK to Ireland by way of Korea, where tidal barrages already exist and plans are being developed to build more.
To enhance these technologies storage and smart grids are going to be key. Moving away from battery technologies could be important, towards innovative new battery-like devices. Yet, governments who make these commitments at summits are not readily coming forward to help these technologies achieve scale which will be the key. The European Union is engaging heavily in this field and the Offshore Renewables Catapult is also helping but more clearly needs to be done.
There are a number of difficulties taking this agreement forward to the COP 21 in Paris in December. At the same time as the G7 met the glamourously titled ‘Ad Hoc Working Group on the Durban Platform for Enhanced Action of the UN Framework Convention on Climate Change’ gathered in Bonn, Germany.
This is the group that negotiates the text ahead of the Paris conference of the parties. This is the sharp point of the sword for the G7 agreement. They now need to successfully take the commitment to Paris.
However, progress in Bonn was painfully slow, as text negotiations always are – we’ve seen UNEP agreements first hand – but several of the key diplomats have said that the mood had been buoyed significantly by the G7 announcement made only hundreds of miles away from Bonn.
Significantly, G7 leaders agreed to speed up renewable energy deployment in Africa, the mechanisms for doing so have not yet been ironed out but we will endeavour to keep readers up to speed @keenecomms and @jake_rigg.
A number of key issues remain:
- Less developed nations have suggested that wealthier countries must also spell out exactly how they are going to come up with the $100bn a year by 2020 promised at earlier talks for poorer countries to transform their energy systems and adapt to climate change.
- How the emissions pledges countries are due to make in Paris will be monitored and ratcheted up in coming decades to ensure the broader decarbonisation plans backed by the G7 occur.
- The mechanism for making any Paris agreement lasting, officials from China have reportedly by less supportive raising questions about whether any deal reached in Paris will last long enough to produce the deep emissions reductions the G7 has now said it wants.
However, it is our view that the G7 announcement signals some real commitment; yes the road ahead offers too many opportunities for the commitment to be watered down. This will happen if the costs remain too high. Governments across the developed and developing world need to start looking at how to help the private sector to deliver the innovation at scale that we need to meet the G7 commitments.
This week could prove to be historic, the week a scientist who grew up under the East German regime and became the Chancellor of a united Germany could have made her country rise to be the most significant force in the 21st Century; the world’s first green superpower.
He was formerly Head of Policy at the Society of Trust and Estate Practitioners (STEP). With degrees in history and economics from the Universities of Oxford and London, Jake is a Fellow of the Royal Society of Arts, a trustee of the European Association of Philanthropy and Giving and advises several governments on public policy. He also advises clients on CSR and philanthropy activities.
Latest posts by Jake Rigg (see all)
- Keene responds to the Budget - July 8, 2015
- The Northern Powerhouse & Pre-Budget Briefing - July 6, 2015
- The emergence of a green superpower on the back of G7 climate deal - June 16, 2015