Fueled by Fuel? The Future of the Paris Agreement as Economies Reopen
The Paris Climate Agreement came into being in 2015 as 190 countries took the first step in adhering to take collective action against global warming. Each country set its own targets and action, reflective of their ability and capacity to reduce greenhouse gas emissions. For some countries, it meant a significant decline in their emissions by 2030; others like China, India, and then-signatory the United States decided on a more gradual phasing-out extending beyond 2030. It was anticipated that 2020 would be a decisive year for climate action. Countries were preparing new and improved strategies that would get us close to our targets for 2030. The “Decade of Action,” as it was called, was supposed to be a super year where decisions on climate, environment, the ocean, and biodiversity would have been made.
Satellite images taken during COVID-19 have shown a huge drop in greenhouse gas (GHG) emissions around the globe. This has attracted a huge celebration from climate activists and other well-wishers on social media platforms, yet many are neglecting the fact that this silver lining is unlikely to last in the post-COVID world. An increase in emission like never is expected when life gets to normal, as countries may intensely engage in the efforts to revive their economies by emitting more carbons. In this scenario, whether or not countries would be meeting their emission reduction targets is doubtful, as the immediate priority of almost all countries in the world would be an economic recovery.
The COVID-induced economic shutdown has presented an unexpected silver lining with a significant reduction in carbon emissions across some of the largest industrial contributors.
Given the economic impact of COVID-19 and the already-existing challenges of offering a development perspective to a rapidly growing population, it might be tempting for countries in the global south to pursue a strategy of fueling growth with the cheapest source of energy available and take care of the environment later. Such an approach, however, would disregard the harmful social cost of fossil fuels, which the population would have to bear. With the massive shutdowns caused by the pandemic, the mobilization of the $100 billion USD pledged by developed countries through the Green Climate Fund may have to wait as these countries put their houses in order. According to the International Energy Agency (IEA), $6 trillion needs to be invested in renewable electricity and biofuels over the next 25 years just to meet current emissions reduction commitments. Policies will play a significant role in driving this investment. African states with their vast untapped renewable energy potential have adopted obligatory binding targets for renewable energy. However, governments have been struggling to mobilise capital in order to fund and bring projects to fruition. Restricted by public budgets, state-owned incumbent utilities have been unable to finance such projects on their own balance sheets, and attracting investors has proved to be rather difficult, as national energy markets do not yet provide for stable, transparent regulatory frameworks and a competitive environment for such investments.
Over the last few years we have seen a rise in nationalism resonating with many citizens around the globe, from “Brexit” to the growth of the “America First” narrative. The Trump administration walked from the Paris Agreement and relaxed environmental enforcement on companies that would fail to comply with federal monitoring or reporting requirements. The reduction of enforcement duties down south has left the Amazon forest exposed by the Brazilian government, despite the fact that it is one of the most important carbon sinks on the planet. Within the EU, Poland is calling for the suspension of a carbon program to free up funds for Warsaw to fight the effects of the coronavirus. The Reuters Warsaw reported a senior Polish official stating, “This will be the time for taking various unconventional, political decisions on all levels.” The Polish government has been using the COVID-19 fight as a justification for neglecting its Green Deal commitments. In other countries throughout the world, similar defaults are taking place: the Czech Republic has expressed the need to abandon a climate bill, and China has been postponing the construction of a huge solar field that will significantly impact its carbon emission ratio.
The current do-it-on-my-own mentality and the lack of international cooperation will intensify our carbon emission rate post-COVID-19. International institutions would struggle to keep countries in check after the pandemic due to the fact that national governments will want to keep their economies running. However, the future of the Paris Agreement could still be a reality if signatories are ready to sacrifice short-term gains for long-term impact— 2030 could still be the North Star if countries are willing to collaborate, strengthen, and rectify their climate change commitments. The Director-General of the International Renewable Energy Agency (IRENA), Francesco La Camera has been advocating for countries to come out of the pandemic with a solid renewable energy development strategy that would include funding, policy frameworks, and education. Such COVID-19 recovery plans should prioritize investments in cleaner energy programs and making funding accessible for infrastructure development that would impact its carbon-intensive sectors.
“The future of the Paris Agreement could still be a reality if signatories are ready to sacrifice short-term gains for long-term impact.”
The current energy infrastructure still has a long way to go, and development on the African continent has been faced with four challenges: balancing liberalization with regulation and control over resources, achieving attractive risk-return profiles while ensuring access and affordability of services, balancing the push for private-sector investment with effective public investments, and balancing local and national needs with the global sustainable development agenda. Energy infrastructure investment is crucial in reducing cost of production and in championing the transition process. However, if countries decide to drift away from each other and open up their economics using large scale fossil fuels, it will define the future of the Paris Agreement and the future of mankind.