In this rather slow pace of progress towards the sustainability growth model, the International Energy Agency’s executive director denounced the alarming failure to realise the potential of clean energy and urged a doubling of clean energy investment by 2020 to avoid missing targets and to keep temperature rise below two degrees.
The number of policy developments being reviewed or watered down have shown that the tough economic environment does not help the implementation of more ambitious climate change policy: the Australian government has been facing pressure from the public and the opposition against its carbon tax regulation, which will now only be levied on half the number of companies initially expected and measures will be introduced to cushion the economic and inflation impact on polluting industries and households. South Africa declared there was no decision yet on the carbon tax proposed last February because of economic growth concerns. China is worrying that its scheduled carbon trading scheme would create inflation and social unrest thus it is considering excluding the power sector from it, with the priority remaining energy price stability and security of supply. And the state of Rio de Janeiro will now indefinitely delay its emissions trading scheme. From a more positive perspective the UK deputy prime minister announced compulsory greenhouse gas reporting for companies listed on LSE’s main markets (around 1,800 companies) and Japan introduced a feed-in-tariff for renewable energy.
As we have mentioned earlier this year, such lack of leadership suggests we should be turning more of our attention towards adaptation to the consequences of dangerous climate change, a subject to which we will return in future months.
A challenged European leadership
On a more positive note, the European Union has marked a significant step forward with the agreement on the Energy Efficiency
Directive (EED). Despite strong opposition from coal intensive Poland, EU countries agreed for the first binding energy saving target of 15% by 2020 (based on Business As Usual from 2009) to be topped up with an additional 2% from the use of more efficient vehicles (transportation is not included in the EED).
The controversy around the impact of the emissions trading system (ETS) on international airlines, however, is on-going: international action by the International Civil Aviation Organisation is unlikely to happen before 2013 whilst Beijing is already penalising the European aircraft industry. The EU Commission is also facing pressure to get a strong CO2 price: a list of large companies has written to the Commission to withdraw some 1.4bn carbon allowance, which is more than the EU Climate Commissioner’s proposal (0.4 to 1.2bn). The EU Commission, however, is also discussing the tightening of the carbon emission target to 30% which would also address the excess allowance issue.
The worrying climate change science
Different US scientific studies this month highlighted that Arctic sea ice levels are at a record low. A consequence is the opening of the ‘Northern sea route’ which cuts 4,000 nautical miles off a journey from Europe to China saving fuel, but also easing oil and gas exploration in the Arctic. Marine biologists also note the warming Arctic is having major ecological effects such as vast concentration of microscopic phytoplankton occurring under the ice whereas until now they were believed to only be in open water; another study looked at changing vegetation in the Artic Tundra, becoming a more lively ecosystem.
The UN released its global environmental outlook report on the deterioration of the Earth’s ecosystem over the last 20 years ahead of the Rio Earth Summit, showing progress has been made on only four of the 90 main environmental goals the UNEP set up: the rate of deforestation, overfishing, air and water pollution have continued to increase, as have atmosphere greenhouse gas concentrations.
Source: Gazprom (The north sea route)