Friday 20/09/2019

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Climate change objectives: lowering the bar for greater credibility?

Responsible Investment Strategist

While the objectives of the European Union have been revised upwards, some countries have lowered their expectations in order to have a more realistic chance of attaining their goals. This is in part because, to date, the results achieved in terms of fighting climate change have generally been disappointing.

 

Busy political agenda

This start of the summer has brought busy times in terms of climate and the environment. Specifically, Germany and Poland jointly hosted the Petersberg Climate Dialogue on 18 and 19 June in order to anticipate the next COP 24 conference to be held in Poland in December. The main subject there will be the practical implementation of the Paris Agreement.

This dialogue was followed by the second ministerial gathering on climate change between the European Union, China and Canada, the objective of which was to bring together the ministers and high representatives of the world’s main economies in order to discuss, with a limited number of participants, the conditions for the negotiations aimed at implementing the Paris Agreement. In particular, one of the topics on the agenda was revising the EU objectives upwards. Moreover, the ministers of the Environment of the European Union gathered on 25 June to discuss a possible upward revision of the lowering of greenhouse gas emissions from 40 to 45%.

A far cry from the quantitative objectives set

Given the urgency it may look like a necessary and ambitious plan to upgrade the reduction objectives, but this may not seem very credible today in the face of the disappointing overall results attained so far. Specifically, in its latest survey the association Climate Action Network (CAN) Europe ranked the EU countries according to their ambitions and the progress they have made in the fight against climate change. Here, the results speak for themselves.

Source: Off target, Ranking of EU countries’ ambition and progress in fighting climate change, CAN Europe.

According to CAN, there is not a single country which deserves to hold the first position in the ranking in terms of climate change ambitions and the progress made, and this is particularly true for the reduction of carbon emissions. Sweden occupies the second position in the ranking.

Belgium holds the 16th position in the ranking. Its environmental performance, in particular regarding emissions reductions, is deemed insufficient as regards the progress made in achieving the 2020 climate objectives, as well as goals which are more ambitious than those of the EU. The fact that climate responsibilities are scattered between four governments is also an issue and is highlighted as the main reason for the lack of coherence and ambition in Belgium’s climate change policy. Without an upward revision of climate objectives by 2030 and in the absence of more ambitious objectives than those of the European Union, Belgium will not achieve a zero carbon society by 2050.

Downward revision of the objectives

France occupies the fourth position and Germany the eight position in the ranking of Climate Action Network Europe. And still, these two countries illustrate how hard it is for politicians to opt for strategic policy choices allowing for a real energy transition. Germany wants to set the example in terms of nuclear energy and should fully exit this source by 2020, but this will entail new brown coal mines and coal-fired power stations. France, on the other hand, will phase out coal-fired plants by 2023, but continues to postpone the nuclear phase-out.

Two ministers of the Environment have now downgraded their ambitions to reflect realistic objectives:

  • Germany has downgraded the reduction of greenhouse gas emissions by 2020 from 40% to 32% compared to 1990 levels. The exit from coal is currently being studied and a long-awaited report on this matter should be presented by the end of the year.
  • France is postponing its 50% cut to nuclear energy dependency to the 2030-2035 timeframe instead of 2025. The roadmap, including the exact date, should be available in early July.

Hence, the time has come for some to lower the hard and fast ambitions so that the objectives are achievable and thus credible. Is this a lack of ambition, or just a slowly moving but very necessary energy transition?

 

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