A Gloomy Forecast for Climate Change

Planned grazing of cattle is an inexpensive and effective tool for restoring damaged grasslands, thereby helping habitat and wildlife. It also helps to reduce – and possibly reverse –  the atmospheric carbon accumulation discussed below.

NOTE: This article is taken from Worldview.Stratfor.comand was published December 6th. Feature image is with permission via Thomas Hafeneth

Highlights

• Market developments in renewable energy and transportation won’t by themselves be enough to avert the worst effects of climate change.
• Given the uneven record of national governments, bottom-up action from federal states and businesses is more important than ever.
• Barring a sea change in global climate commitments, humans will have little choice but to adapt to hotter Earth conditions in the coming decades.

When it comes to climate change, there is no disputing that the world is getting warmer. For those pondering how best to manage a sultry Earth, the issue is increasingly binary: what can be done to mitigate greenhouse gas emissions that contribute to global warming, and what can humans do to better adapt to a hotter environment? For those present at the 23rd Conference of Parties to the U.N. Framework Convention on Climate Change, or COP23, in Bonn, Germany, the question might well have been “how do countries agree to agree?” The COP23 conference concluded Nov. 17 with none of the fanfare of COP21 in Paris, held just two years earlier. The expectations, and the resultant goals for this year’s conference, were modest, even though human-generated carbon emissions for 2017 have risen by 2 percent, a bump largely attributed to China. It was also the first U.N climate conference held after the inauguration of U.S. President Donald Trump, who has announced his intention to withdraw from many of the climate agreements and policies endorsed by his predecessor.

Further overshadowing the conference were findings from the U.N. Environment Program (UNEP). According to the latest emissions gap report, current pledges under the Paris Agreement fulfill only one-third of the amount needed to limit global temperature rise to 2 degrees Celsius, the key limit identified by the scientific community to minimize many of the risks associated with current climate trends. In an attempt to maintain momentum, COP23 continued the process to create a “Paris rulebook” — detailed guidelines and regulations governing the implementation of voluntary carbon emission targets agreed to in 2015. The Paris Agreement was essentially a historic compromise between the developed and developing world preventing the multilateral climate process from breaking down entirely. The cornerstones of the agreement were mitigation, adaptation, technology and finance. When it comes to managing climate change, however, this meant defining a uniform methodology by which states would monitor, report and verify their emissions to the U.N. Framework Convention on Climate Change. Emissions reduction pledges are voluntary, though, enforced through “soft” means such as periodic peer reviews and naming-and-shaming.

Beyond compliance, there is the implementation of an international mechanism to help the most vulnerable countries adapt to the unavoidable effects of climate change, widely known as Loss and Damage. Emerging economies also had the opportunities to identify actions for reducing emissions by developed countries before 2020. And on the conference sidelines, climate activists pushed for major greenhouse gas emitters to commit to a coal phase-out date.

A Changing Political Climate

Despite Trump’s vocal intention to withdraw from the Paris Agreement, a move that would come into effect in 2020, the U.S. delegation was surprisingly engaged at Bonn. Though U.S. delegates inevitably promoted fossil fuel energy at side events, inside the negotiation chambers, they focused on defending their interests within the parameters of Paris. And this was just the official representatives. Among those still advocating a responsible stance against climate change are former New York City Mayor Michael Bloomberg and California Gov. Jerry Brown. Made up of business leaders, U.S. corporations, federal states and cities that contribute over half of total U.S. GDP, the “We Are Still In” coalition seeks to demonstrate that pro-climate action attitudes are prevalent among a large section of the North American population.

Given the reluctant participation of the Trump administration, the role of the other three major greenhouse gas emitters — the European Union, China and India — became more crucial at Bonn. Still, major divides will have to be bridged if the Paris rulebook is to be finalized by next year. While the parties ultimately agreed on reviews of pre-2020 actions and climate finance at the next two climate conferences, differences could not be overcome on monitoring, reporting and verifying their emissions, and the establishment of a separate finance stream for Loss and Damage.

There were some rays of sunshine when it came to climate action, however. Solar energy infrastructure is increasingly affordable in a number of faster-growing developing countries, and wind turbine designs have greatly improved. Though China remains the world’s largest contributor to global emissions, Beijing is adding non-fossil fuel electrictiy generation capacity at a furious pace. The effects of those efforts remain tempered, however, by continued large consumption of coal and natural gas in the power generation sector as well. Another major polluter, India, is on track to meet its Paris commitments. Working with France, New Delhi hopes the newly established International Solar Alliance will kick-start India’s renewable energy sector. Germany remains progressive, with a trailblazing energy revolution known as Energiewende underway. Wind and solar sources accounted for an impressive 35 percent of total electricity generated in the first half of 2017. And despite the newfound reticence in the United States over climate, the shale revolution has driven a switch from coal to natural gas for electricity generation.

Beyond renewable energy sources, progress is being made in tackling emissions from motor vehicles. Tesla, Inc., continues to pioneer the electric vehicle and battery marketplace. Several countries — including the United Kingdom, France, Norway, the Netherlands, China and India — have announced phase-outs of internal combustion automobiles within the next 15 to 25 years. Major fossil fuel-based corporations such as Norway’s Statoil, India’s NTPC and Royal Dutch Shell are deepening their interest in the renewables business, providing some hope of the eventual emergence of hybrid energy giants. Norway’s $1 trillion sovereign wealth fund is moving away from fossil fuel energy investments. Given its lead in refrigerant technologies, there’s even good reason to hope for U.S. ratification of the Kigali Amendment to the Montreal Protocol, which aims to eliminate hydrochlorofluorocarbon-based refrigerants that are potent climate warmers.

No Time for Celebration

The news is not all good, however. Many countries are not on track for meeting their existing commitments or are performing well below potential. Germany’s emissions have been largely constant for eight straight years because of Berlin’s move away from nuclear plants and reliance on lignite for baseload electricity production. India has strongly expanded renewably generated electricity and LED lighting, but old coal plants and inefficient transportation put it well below its low-carbon potential. Grid integration and curtailment of renewables remain a challenge in many countries, and the variable nature of solar and wind generation can lead to price volatility in heavily traded markets. The shift to electric vehicles is likely to be slow, and there are still structural issues to overcome, such as scaling charging infrastructure and the price of batteries.

Eastern European countries such as Poland and oil exporters including the Gulf states and Russia are reluctant to curtail their use of fossil fuels. Canada’s and Australia’s climate records are also poor. China has committed to an emissions peak by 2030, but its latest coal consumption trends aren’t encouraging. Beijing’s widely anticipated national emissions trading scheme has also been delayed. The Green Climate Fund, another initiative coming out of the U.N. climate conferences, has been funded only to the tune of $10 billion so far, but much more is required. And as the recent climate conference revealed, there are still serious disagreements over how the money pledged by developed countries to tackle climate change — $100 billion yearly — should be mobilized. It isn’t even clear how much has already been committed.

To What End

The highly politicized debate around climate change in U.S. politics presents one of the greatest barriers to global compliance. Domestically, the Trump administration has already rolled back predecessor Barack Obama’s signature Clean Power Plan, along with standards on methane leaks from gas wells and fuel economy standards for automobiles. Most recently, the U.S. International Trade Commission found grounds for imposing up to 35 percent tariffs on imported solar panels — a final decision will be taken by the White House in January 2018. There is also no guarantee that Trump will be re-elected in 2020, meaning that the United States may not actually exit the Paris Agreement as announced.

It is recognized that nation-states have a poor track record when it comes to averting the worst effects of climate change. It will be increasingly dependent on bottom-up action from cities, federal states, businesses and individual consumers to create meaningful progress. Activist shareholders are already making their presence felt, contributing to Royal Dutch Shell’s embrace of renewables and forcing Occidental Petroleum to assess its vulnerability to climate change. The California-Quebec-Ontario emissions trading market and the growing prominence of coalitions of cities in fighting climate change are positive developments running in parallel to state-led undertakings. Despite all this activity, it is an open question whether all these approaches will be enough. Given the centrality of sovereign states to the global order, meaningful change requires complete buy-in, which is problematic.

Under the Paris Agreement, signatories must agree to common standards for monitoring, reporting and verifying emissions by 2018. Then they must raise their cash pledges from 2020, with periodic “stock-taking” sessions beginning in 2023. Given the lack of cohesive leadership and drive, there is no guarantee any of those targets will be met. Therefore, 2018 will be far more contentious than 2017. Two main topics — finalizing the Paris rulebook and climate finance — will take center stage next year. Prospects for success at COP24 in pro-coal Poland do not look particularly good.

If the current lack of momentum continues, cohesive climate action is likely to remain anemic for the next several years. Without the development, adoption and scaling of technologies to meaningfully combat greenhouse gas emissions, the forecast is decidedly gloomy. In such a scenario, talk of mitigating the effects of climate change will be subordinate to the reality of adapting to a hotter world within a decade or two, one plagued by frequent natural disasters and climate-induced conflicts. Some nations will be better placed than others to deal with the consequences of climate change and the resultant impact on global order, but there is no guarantee that the current world order will be maintained.