In this moment of urgency on climate action, the conclusion of Sharm el-Sheikh’s COP27 seemed to satisfy no one. Its legacy is a hard-wrought implementation plan that combines heartening glimpses of progress with some equally disappointing gaps. On progress, a loss and damage fund offers some hope to nations most vulnerable to the climate crisis. At the same time, there was little momentum on the critical issue of the world’s dependence on fossil fuels, or on accelerating the adoption of efficient solutions to reduce global emissions.
While UN member states enjoy coming together in the spirit of discussion, their dedication to the shared ambition often stops short of any commitment that would interfere with decisions now made on a national level. It is at these national and subnational levels that we now need to see decisive action. It has taken seven years from the Paris Agreement for us to be seriously discussing implementation. This illustrates the frustrating pace of multilateral action, which stands in stark contrast to the urgency of the task ahead. At the heart of this reluctance, the gap between ambition and action rests on a widespread perception that decarbonization is a cost, rather than an opportunity.
The true cost of fossil fuel addiction
The devastating ecological and human impact of climate inaction if now well understood. But our dependence on fossil fuels is also a costly one. These legacy energy sources are no longer cheap, even before the staggering subsidies enjoyed by the industry. In 2021, the International Monetary Fund estimated that the global production and burning of coal, oil, and gas was subsidized by US$5.9 trillion in 2020, or 6.8% of GDP, and that number is expected to rise. To put it another way, we subsidized fossil fuels by more than US$700 per capita in 2020 alone. According to the IMF, efficient fuel pricing in 2025 would reduce global carbon dioxide emissions 36 percent below baseline levels in 2025, in line with keeping global warming to 1.5 degrees.1 Still Not Getting Energy Prices Right: A Global and Country Update of Fossil Fuel Subsidies (imf.org)
Despite this colossal financial and ecological burden, our society retains an inexplicably attachment to outdated technology that hampers our development and pollutes our planet. With innovation and possibility all around us, we should be moving to adopt technologies that solve multiple problems, which in all cases are both more attractive and more profitable. These solutions are more economical, better for the environment, and provide a better standard of living for citizens at large.
When the Montreal Protocol was agreed in the late 1980s, we were unaware that it would be widely considered a warm-up for the main event. In a spirit of unprecedented commitment and cooperation, this multilateral agreement has successfully set us on a path to recover the ozone layer by the middle of this century. Private sector innovation immediately followed as companies devised and adopted newer technologies without ozone-depleting properties. With the right motivation, there is no shortage of public and private sector innovation that can move us towards outcomes that are not just cheaper, but better in every way.
Energy efficiency now
Indeed, our lowest cost solution is simply to reduce our energy expenditure. Energy efficiency is energy that costs nothing. By doing more on efficiency, we free up electricity to accelerate electrification of heating and transport, lessening our dependence on fossil fuels. In the lighting industry, we know the benefits of switching conventional light points to connected LED. Lighting is a technology that touches everyone. There are close to 30 billion light points across the world, presenting a huge opportunity for progress.