In a report published by Energy Transitions Commission, a coalition of 45 leaders from global energy producers, energy-intensive industries, financial institutions and environmental advocates argued that the world can and must achieve net zero greenhouse gas emissions by mid-century.
Energy leader including Arcelor Mittal, Bank of America, BP, Development Research Center of the State Council of China, EBRD, HSBC, Iberdrola, Ørsted, Shell, Sinopec Capital, Tata Group, Volvo Group and the World Resources Institute among others said the in the long term “zero must mean zero”, with no permanent rather than transitional reliance on negative emissions to balance continued large-scale emissions from the energy system and industry.
It also lays out steps needed in the next decade to achieve that objective.
In its new report Making Mission Possible – Delivering A Net Zero Carbon Economy, the Energy Transitions Commission (ETC) shows that clean electrification must be the primary route to decarbonisation: it highlights that dramatic falls in cost of renewable energy make this easily affordable and argues that all growth in electricity supply should now come from zero-carbon sources with no need to build any new coal-fired power capacity to support economic growth and rising living standards.
The report demonstrates that it is technically and economically possible to have a carbon-free economy by around mid-century at a total cost of less than 0.5% of global GDP by taking three overarching steps:
Using less energy while improving living standards in developing economies, by achieving dramatic improvements in energy efficiency and shifting to a circular economy;
Scaling up clean energy provision by building massive generation capacities of cheap clean power, at a pace five to six times higher than today, as well as expanding other zero-carbon energy sources such as hydrogen;
Using clean energy across all sectors of the economy by electrifying many applications in buildings, transport and industry, and deploying new technologies and processes using hydrogen, sustainable biomass or carbon capture in sectors that cannot be electrified, like heavy industry or longdistance shipping and aviation.
The signatories acknowledge that this report is published in “an unprecedented context”. They argue that the COVID-19 pandemic has demonstrated the unpreparedness of the global economy to systemic risks and that the massive public spending now being dedicated to stimulating economic recovery constitutes a unique opportunity to invest in a more resilient economy.
The ETC estimates that additional investments required to achieve those goals will be in the order of US$1 trillion to US$2 trillion per year, equivalent to 1% to 1.5% of global GDP. This represents only a small increase of global investments which currently amount to about a quarter of global GDP, and would contribute to global economic growth.
“There is no doubt that it is technically and economically possible to reach the zerocarbon economy which we need by 2050; and zero must mean zero, not a plan which relies on the permanent and large-scale use of “offsets” to balance continued GHG emissions. But action in the next decade is crucial – otherwise it will be too late.”, ETC Co-Chair Adair Turner said.
Fellow ETC Co-Chair Ajay Mathur added, “In India as in many countries, climate change is already impacting people and disrupting the economy. Governments from developed and developing countries will find in this blueprint practical recommendations on how to enhance their national strategies and ramp-up their commitments as part of the Paris agreement.”
The report outlines 3 critical priorities for the 2020s and practical actions that nations and non-state parties can commit to in the run up to the COP26 United Nations Framework Convention on Climate Change in November 2021 to put mid-century objectives within reach.
Speed up the deployment of proven zero-carbon solutions – governments, investors and corporates need to work hand-in- hand to build up massive capacities of zero-carbon power generation to enable the clean electrification of the economy.
Create the right policy and investment environment – by removing fossil fuel subsidies, increasing carbon prices and combining them with border carbon adjustments in the absence of an internationally-agreed carbon price, putting in place regulations – like fuel mandates or lifecycle emissions standards for manufactured products – that create additional incentives for decarbonisation where price signals are insufficient, and working with financial institutions to channel investment not only to green activities but also to energy-intensive industries making their transition.
Bring the next wave of zero-carbon technologies for harder-to-abate sectors to market – so they can be deployed in the 2030s and 2040s, by focusing public and private R&D on – critical technologies (like hydrogen, sustainable fuels or carbon capture), creating demand for new green products and services (through “green buyers’ clubs, public procurement, and product regulations), and financing the first commercial-scale pilots through smart use of de-risking public funds alongside private capital.
The ETC’s blueprint is intended to allow all developed economies to reach net-zero emissions by 2050 at the latest, including China which has the resources and technology leadership to become a rich developed zero-carbon economy by 2050. All developing nations would be able to reach net-zero emissions by 2060 at the latest, but require development finance to de-risk and attract private green investment.