Last week, I watched Greta's speech at the World Economic Forum at Davos (
https://youtu.be/CWBGbAZlpRU, see also
Strategic CSR – Greta) and I am caught between two reactions. On the one hand, of course, she is exactly right. Everything she said was on point in terms of tone, scale, and urgency. And a lot of powerful people in the room took it on the chin, and then lined up for some more (both tragic and funny, in equal amounts). On the other hand, however, I know that her critics are correct that she is being completely unrealistic in terms of what is possible. There is no way we are going to become carbon neutral today and carbon negative tomorrow (even though she is correct that this is what is required). It is in light of these conflicting emotions that I wanted to share the article in the url below. In my opinion, it is one of the first honest (and serious) attempts I have seen by a government of a developed economy to address climate change:
"Germany announced on Thursday that it would spend $44.5 billion to quit coal — but not for another 18 years, by 2038. The move shows how expensive it is to stop burning the world's dirtiest fossil fuel, despite a broad consensus that keeping coal in the ground is vital to averting a climate crisis, and how politically complicated it is."
The reason for the delay? Exactly the kind of complexity that Greta says we must overcome and her critics say is exactly why she is being unrealistic. First, are the natural resource constraints Germany faces – some are simply natural limitations, while others are politically self-imposed (but none the less complicating because of that). After all, the only reason America has reduced its coal consumption is because it is lucky enough to have abundant supplies of natural gas:
"Germany doesn't have shale gas, as the United States does, which has led to the rapid decline of coal use in America, despite President Trump's support for coal. Germany also faces intense opposition to nuclear power. After the Fukushima disaster in 2011, that opposition prompted the government to start shutting down the country's nuclear plants, a transition that should be complete by 2022."
Second, are the political interests that make a negotiated settlement so challenging:
"The money … is to be spent on compensating workers, companies and the four coal producing states — three in the country's east and one in the west. It followed months of negotiations between regional officials and Chancellor Angela Merkel's government."
And this is in Germany, one of the richest, most powerful economies in the world. Even so, it is unable to act independently and, as a result, is criticized by activists for acting too slowly:
"Germany's timetable, though, could present challenges to the European Union's efforts to swiftly cut its greenhouse gas emissions, as the bloc's new leadership has announced. Countries around the world are watching how quickly the 28-country union, which, taken together is currently the third-largest emitter of planet-warming gases, can reduce its carbon footprint. Germany is the largest economy in the European Union. Environmental organizations criticized the government plan for being too slow and for not expanding renewable energy sources quickly enough."
In other words, none of this is to say that what Germany is doing is sufficient to prevent the worst of climate change from occurring (it certainly isn't), but it is a policy response that is both serious and recognizes reality. If we are to make substantive progress, we are going to have to do something similar with the oil companies, and then the gas companies after that. It seems to me that we either pass a meaningful carbon tax and strangle them to death or we bribe them out of existence. Most politicians seem to prefer bribes to violence so, in this sense, what Germany is doing is an honest attempt to make meaningful progress. I don't see many similar attempts elsewhere:
"… coal remains ascendant in some parts of the world, in part because it has been the go-to fuel for so long, it employs millions of people globally, and because the industry often enjoys robust political backing. … The Asia-Pacific is where coal continues to grow. China, which consumes half of the world's coal, continues to build more coal plants at home and abroad. … Not least, China's ambitious global infrastructure building drive knows as the Belt and Road Initiative includes at least 63 coal-fired power plants. India also continues to rely on coal. It has recently relaxed rules to encourage foreign investment in the Indian coal mining sector, and has been in talks to import metallurgical coal, used to make steel, from Russia. And even as it reels from wildfires made more intense by climate change, Australia, one of the world's biggest coal exporters, is digging for more, encouraged in part by the growing Asian market. Among the most contentious projects is a new $2 billion coal mine in the country's northeast."
Clearly, we need more of Greta. In the meantime, the article in the second url below gives an idea of the scale of the undertaking ahead:
"In order to meet the goals of the Paris agreement to keep global warming below 2°C, … UBS, a bank, calculated that capital spending on renewable energy, power grids and batteries will need to rise globally to $1.2trn a year on average from now until 2050, more than double the $500bn spent each year on oil and gas. To help fund that, it reckons that oil-and-gas companies will need to divert $10trn of investments away from fossil fuels over the same period."
That is $1.2trn, a year, every year, between now and 2050. I don't see any way that will happen unless a combination of significant pressure to change from stakeholders, combined with lucrative incentives to do so, are brought to bear, and quickly.
Take care
David
David Chandler
© Sage Publications, 2020
Germany Plans to Quit Coal, but it Will Take 18 Years
By Somini Sengupta and Melissa Eddy
January 17, 2020
The New York Times
Late Edition – Final
A8
Blowin' in the wind
By Schumpeter
January 18, 2020
The Economist
Late Edition – Final
61
