More than ever, time is short in climate policy. That’s why we should discuss the important things. Easier said than done, as our Climate.Table shows today. We have collected examples of where serious debates have sometimes fallen short so far.
Everyone is talking about the urgent need to develop renewables around the world. But rarely does anyone – like our colleague Nico Beckert – point out that this development makes little sense without expanding power grids. Many are debating whether global warming can still be limited to 1.5 degrees. But we have found for you in the IEA’s report what that would take: Three times as much renewables, 4.5 trillion dollars of investment annually, no new gas, oil and coal projects. That’s what it’s about.
There is also a lot of arguing about CCS. But little is said about how this dispute paralyzes Germany’s climate policy and alienates traditional allies – when internal debates limit Germany’s international political capabilities, as happened last week in New York. And finally, the migration debate is boiling up again, but an important aspect remains unmentioned: How is Europe preparing for European climate refugees in Spain or Greece who may lose their homes? Our opinion piece today touches on this overlooked question.
We hope you enjoy reading and hopefully gain some new insights,
Germany’s position in international climate policy is weakened by disputes in its government coalition. The coalition partners disagree on the path to a global phase-out of fossil fuels. As the government could not find a common position on whether such a phase-out should be demanded with or without carbon capture and storage (CCS/CCU), Chancellor Olaf Scholz refused to sign a corresponding declaration by the High Ambition Coalition (HAC) last week. Usually, Germany is one of the most important and progressive countries in the HAC on the international stage. Since the Paris climate summit, the HAC has been uniting countries across all UN groups that advocate for more and more vigorous climate action.
On the occasion of UN Secretary-General António Guterres’ Climate Ambition Summit on September 20, the HAC published an urgent appeal for more ambitious climate efforts. The text by the heads of state and government calls for, among other things, stricter renewable energy and energy efficiency targets and more climate financing to achieve the global climate goals. But the text also calls for a systemic transformation “across all economic sectors, driven by a global phase-out of fossil fuels.” The text further says: “Abatement technologies have a role to play in reducing emissions, but that role in the decarbonization of energy systems is minimal. We cannot use it to green-light fossil fuel expansion.”
Scholz did not support the wording accepted by 20 heads of state and government from countries including France, Austria, Chile, Belgium, Spain, Denmark, Barbados, Tuvalu and Kenya. It touches on one of the crucial questions of this year’s COP: Should the phase-out include all forms of fossil fuels – or only “unabated” forms, i.e., energy production without CCS/CCU?
In response to a question from Table.Media, a spokesperson for the German government said that while Germany “fundamentally supports the goals of the High Ambition Coalition, the version submitted went beyond wording previously agreed at the international level.” Moreover, “there was no conclusive position within the Federal Government,” which is why Germany abstained from signing the statement. The “agreed wording” refers to the final declaration of the G7 summit in Japan, which also only mentions the rapid phase-out of “unabated fossil fuel.”
According to information from Table.Media, there had previously been disagreement between the Green-led Foreign Office and the FDP-led Federal Ministry of Finance during the internal coordination within the government. While Foreign Minister Annalena Baerbock has repeatedly urged that the upcoming COP28 in Dubai must agree to end the use of all fossil fuels, the ministry led by Finance Minister Christian Lindner favors “technology openness” – and that also means the use of CCS/CCU in the energy sector.
Sources in the Ministry of Finance say that the “overall economic development must be kept in mind.” A “renunciation of the addition of ‘unabated’ would have massive economic effects, as operating certain industries where fossil energy cannot be easily replaced would no longer be possible. This would only lead to migration tendencies, but not serve climate action as a whole.” This reasoning, it emphasizes, has “already found its way into the position of the federal government as a whole in various places.”
Lindner’s ministry is not alone in this demand. COP President-elect Sultan Al Jaber, Minister of Industry of the United Arab Emirates and CEO of the state-owned oil and gas company Adnoc, also advocates the end of unabated fossil fuels. Globally, oil and gas producing countries mainly oppose the demand to leave fossil fuels in the ground.
By contrast, climate groups and island nations fear that such wording at COP28 could result in the unchecked continuation of the fossil fuel business model. Furthermore, this could delay urgently needed investments in renewables and postpone emission reductions into the future by referring to possible CCS technologies. It would be doubtful whether global greenhouse gas emissions could be halved by 2030, which is needed to meet the 1.5 limit, according to the Intergovernmental Panel on Climate Change (IPCC), if CCS technology were to slow down the rate of renewables. As the International Energy Agency recently stated, CCS/CCU has so far failed to meet expectations. Greater political support and faster progress are needed to achieve a breakthrough with CCS/CCU.
Nevertheless, the front of countries advocating leaving fossil fuels in the ground and using CCS/CCU only for practically unavoidable emissions is crumbling. At least, that is also the position of German climate and economics minister Robert Habeck, whose ministry is currently working on a “carbon management strategy.” The plans are intended to allow German companies to export their unavoidable CO2 emissions, for example, from the steel or cement industry, from Germany via ship, truck or pipeline and deposit them in Danish or Norwegian storage facilities under the North Sea. But Habeck’s strategy explicitly does not involve a CCS/CCU solution for emissions from the energy sector, like the one the UAE has in mind.
However, the EU has now also followed the UAE’s line. It is now merely calling for an energy system “free of unabated fossil fuels.” EU Commission President Ursula von der Leyen reiterated this position at Guterres’ summit in New York. Whether this position, i.e., agreeing with the demands of the UAE and other oil and gas producers, will also become the official negotiating position of the EU at COP28 in December will be decided by the EU in October.
Scholz’s abstention on the demand for a hard exit further weakens the HAC on this point. In her negotiations, for example, at the COP, Baerbock could also face the perception that she lacks the support in her own cabinet for this.
However, the German Chancellor’s speech at Guterres’ Climate Ambition Summit again adopted Baerbock’s tough phase-out formulation: “In Dubai, we will all need to make a strong decision to phase out fossil fuels, first and foremost coal.” There was no mention of “unabated” – but then, the focus was on coal, not oil or gas.
The triumphant progress of renewables seems to be unstoppable. China installed almost 100 gigawatts of new solar capacity in the first seven months of this year, already surpassing the record year of 2022. The sector has also grown rapidly in the US in recent years. But power grids are not being expanded fast enough and threaten to slow down the energy transition.
Without a modern power grid, green energy won’t reach electric steel mills, EVs and heat pumps that make up a green economy. According to the think tank Bloomberg NEF, global power grids need to be expanded to 152 million kilometers by 2050 to achieve climate goals – twice the existing length. This expansion would require 21 trillion dollars in global investments by 2050, with more than a third of these investments needed in China and the United States. If these two countries do not expedite their grid expansions, the energy transition could be seriously threatened, warn experts.
The US power grid could become one of the biggest bottlenecks in the country’s energy transition. According to a Princeton University study, the grid would have to be expanded twice as fast as in the last decade for the Inflation Reduction Act (IRA), the billion-euro program for the green transformation of the United States, to achieve its full effect. The study says that if expansion is not ramped up, more than 80 percent of the potential emissions reductions from IRA measures could be lost.
According to Princeton researchers, the network expansion has already achieved similar growth rates in the past. But the US faces significant challenges in this regard:
The local power grid is already at capacity in many parts of the country. This threatens to slow down the energy transition, as individual developers of new power plants have to pay both for the connection to the local power grid and for its expansion if newly built power plants push the grid to its capacity. Such grid expansion can massively drive up the cost of new wind and solar farms, forcing some project developers to abandon them. In addition, project developers sometimes withdraw their construction applications if they have to pay for grid expansion. The New York Times reports that they submit numerous applications and only build projects where other project developers bear the costs of grid expansion.
In addition, project developers now have to wait almost twice as long for connection to the power grid as they did between 2000 and 2010. Back then, it took an average of 2.1 years for a new power plant to be connected to the grid – now it’s 3.7 years. The authorities are overstretched due to the flood of new applications. To speed up the power grid expansion, the US federal government has provided 29 billion US dollars under the Infrastructure Investment, the Jobs Act and the IRA. But as Bloomberg NEF notes, these investments are not enough to achieve net-zero emissions by 2050.
China has experienced grid limitations impeding its energy transition in the past. In the early and mid-2010s, many new wind and solar parks remained idle because of inadequate grid connections between Chinese provinces and artificial barriers to power trading between provinces. During that period, curtailment rates (the amount of unused energy) reached as high as 40 to 50 percent. This meant that wind and solar power plants were constructed but left unused because the grid could not handle the additional electricity. Consequently, the construction of several new solar and wind power plants was halted for years.
While the situation has improved significantly since then, the recent boom in solar and wind energy presents new challenges that could once again hinder China’s energy transition:
China is expected to invest slightly more than 80 billion euros in expanding its power grid this year. While this is a substantial sum, it falls short of what is needed. Investments should be increased to match the record-high investments in renewable power generation, says Run Zhang, China Project Manager at Agora Energiewende.
“The imbalance between record-high investment in renewable generation and relatively low investment in the power grid may be a barrier to accelerating China’s clean energy transition,” says Kevin Tu of Agora Energiewende.
The new records in renewable energy expansion “will test the limits of China’s power system,” write Trivium experts. “A return to persistently high curtailment rates could force policymakers to once again slow the construction of new facilities.” Even if policymakers can resolve grid constraints, additional challenges remain: China’s electricity market is still highly inflexible and power trading across provincial borders is hindered by political interests and bureaucratic hurdles – further impeding the energy transition.
According to EU Commission President Ursula von der Leyen, only 23 percent of global greenhouse gas emissions are currently subject to a CO2 price, which would bring in $95 billion in revenue, she said last week at the UN climate summit in New York – and added to the sum with a thought experiment: imagine the revenue that would be generated for investments in low- and middle-income countries if the 60 percent of global greenhouse gas emissions targeted by UN Secretary-General António Guterres could be covered by 2030.
At the EU level, an instrument is being launched this weekend to help persuade countries outside Europe to put a CO2 price on their most climate-damaging industries – similar to what the EU ETS already does. CBAM imposes a tariff equal to the European CO2 price on emissions-intensive manufactured products imported into the EU. If the emissions in the country of manufacture are already subject to a CO2 price, the duty is discounted by this amount.
Admittedly, the ostensible purpose of the instrument is to protect European industry from competitive disadvantages and carbon leakage – the relocation of emissions-intensive operations to third countries. But EU legislators emphasized early on that CBAM should also motivate non-European countries and regions to introduce their own CO2 prices. This is the only way they can avoid or at least limit the CBAM levy in trade with the EU.
In fact, there were first tentative imitators even before the CBAM was finally adopted. Turkey had long resisted a CO2 levy, but after the CBAM was presented in 2021 it conceded that the instrument would be an incentive to restructure its own industry with the help of the EU, to make it future-proof and to adapt it to the Green Deal. Although there is still no Turkish ETS, planning is underway.
Following the European model, Australia reformed its emissions trading system this year and introduced a CO2 price for its most emissions-intensive industrial plants as recently as July. As with the EU ETS, the emissions cap falls year by year, forcing plants to reduce their greenhouse gas emissions. Meanwhile, Australia is also planning a CBAM to protect its own markets from climate-damaging imports from abroad. The government now wants to take a close look at the European CBAM and submit its own proposal for imports of steel and cement next year.
In Indonesia, too, work is proceeding at full speed on a CO2 price. Voluntary certificate trading has already been launched to finance the transformation of the energy sector. Now a mandatory CO2 price is to follow for other sectors as well. Indonesia wants to adopt international standards so that it can also offer its carbon credits to foreign buyers.
That there are not only quick imitators of the most important European climate protection instruments is shown in particular by India. 19 percent of India’s exports go to the EU. In 2022, they were worth over €9 billion in the CBAM sectors of aluminum, fertilizer, electricity, cement, hydrogen, and iron and steel. The Indian steel and aluminum industry in particular is concerned about the CBAM price premium because the CO2 intensity of the domestic industry is significantly higher than the global average.
India has therefore expressed considerable reservations about the CBAM and has also presented these to the WTO. This is also about fairness between the European industrialized countries and the emerging country India. Suranjali Tandon, a professor at the National Institute of Public Finance and Policy in New Delhi, criticizes the CBAM as imposing the EU’s transition speed on developing countries. Since developing countries do not have CO2 pricing, the EU would earn from their exports through the CBAM. While this is a discriminatory measure, it also offers opportunities, he said. “Developing countries can build markets and impose domestic taxes that not only support their efforts to achieve net-zero targets, but also better articulate the potential limits to pricing that are consistent with development priorities and highlight the inaction of developed countries.”
India is therefore considering regulatory responses. Under discussion is a separate CO2 tax for export goods to the EU that meets the CBAM criteria for rebates. If introduced, India would earn from the CO2 price instead of the EU. Another option, and a retaliatory measure of sorts, is to impose a countervailing tax on imports from the EU to India. However, India is threatening to violate WTO guidelines itself by doing so. India is also in the process of introducing emissions trading.
In the United States, too, there are proposals for a CO2 border adjustment to protect the country’s own industry from foreign competitors. Ideas for this are supported by Democrats and Republicans. However, the effort has so far foundered on the question of whether it would take a national CO2 price to impose a CBAM on foreign imports. Republicans do not want such a price – but imposing a CBAM without a national CO2 price would not comply with WTO rules. The Democrats, on the other hand, have already introduced a CO2 price in twelve states.
Brazil, under President Lula da Silva, has also announced an emissions cap for large polluting companies and the creation of a regulated carbon market. A CO2 price is part of the plan. Around 5,000 companies from the steel, aluminum, cement as well as chemical industries that emit more than 25,000 metric tons of CO2 annually are to be affected. It is not yet known how high the cap will be set, but it is to fall gradually in line with the European model.
It is true that Brazil is an important trading partner for Europe, mainly because of its agricultural exports – and these are not affected by the CBAM. But steel and iron, aluminum, fertilizers and cement are also high on Brazil’s export list. In addition, Brazil could become Europe’s oil supplier in the future, and there is already consideration of extending the CBAM to all fossil fuels in the next step.
China has had a functioning emissions trading system since 2021 – the year the EU launched its Fit For 55 package and a landmark reform of the ETS. It covers around four billion tons of CO2 and over 40 percent of the country’s greenhouse gases, but so far it only affects larger coal and gas-fired power plants. Expansion to all industrial sectors has been repeatedly postponed and is currently scheduled for 2025, a year before financial compensation is due for the first time at the EU’s external borders under the CBAM. To be sure, there are still significant flaws in China’s CO2 price. But the goal is obvious: avoid EU border tariffs. With Urmi Goswami
Replacing internal combustion cars with EVs will not be enough to meet Germany’s climate targets, according to a new analysis by the NGO Transport and Environment (T&E). Cars with combustion engines would also have to stay home much more often. According to T&E’s calculations, the number of kilometers driven with internal combustion engines will have to decrease by 55 percent by 2030 compared to 2018. Even under the optimistic assumption of 15 million EVs on German roads by 2030, vehicle kilometers would have to decrease by 24 percent overall by 2030. Otherwise, the climate targets for the transport sector are impossible to meet.
T&E analyst Benedikt Heyl says: “Money remains available for the expansion of autobahns, while follow-up funding for the 49-euro ticket hangs in the balance.” “Individual mobility in cars” should not be promoted “at taxpayers’ expense,” T&E criticizes. The organization advocates affordable local and long-distance public transport. nib
According to new research by Carbon Brief, carbon offset projects in forests are not only often greenwashing, they also have a negative impact on the ground. They report that such projects often harm local and indigenous communities. Moreover, their ability to bind CO2 is often overestimated. In addition, they can harm food production and are, in some cases, linked to illegal land. Carbon Brief examined numerous media reports and analyses by the Environmental Justice Atlas.
The expert portal compiled reports on the negative impacts of offset projects from all regions of the world. In Latin America, 15 of 19 reports involved projects in the Amazon rainforest.
In the recent past, carbon offset projects have repeatedly been criticized. Most recently, for example, a study by the Berkeley Carbon Trading Project criticized offset projects in the rainforest as ineffective and setting the wrong incentives. At the same time, the number of offset certificates sold through them increased sharply. kul
Time is running out, but global warming can still be kept below 1.5 degrees thanks to the dynamic growth of renewable energies, writes the International Energy Agency (IEA) in its updated net-zero scenario for the energy sector. To keep the climate targets achievable, however, countries must massively step up investment in the energy transition and stop investing in expanding the extraction and burning of fossil fuels.
Accordingly, an annual investment of 4.5 trillion US dollars would be required worldwide in the early 2030s. For this year, the IEA forecasts record investment in clean energies of 1.8 trillion US dollars. Developing and emerging countries, in particular, would have to invest more in the energy transition and require international support of 80 to 100 billion US dollars annually in loans at preferential conditions.
According to IEA calculations, carbon emissions from the energy sector must fall by 35 percent and demand for fossil fuels by 25 percent by 2030. This could be achieved if renewable energies are expanded swiftly enough and coal-fired power plants are taken off the grid more quickly. Then, new oil and gas production and new coal mines or power plants would no longer be required for a secure power supply.
Although carbon emissions from the energy sector reached a global peak of 37 billion metric tons in 2022, the IEA believes that the energy sector is changing faster than many think:
However, the IEA says that much more needs to be achieved. By 2035, carbon emissions from the energy sector must be reduced by 80 percent in wealthy countries and by 60 percent in emerging and developing countries compared to 2022. The countries’ climate targets are insufficient to achieve net zero emissions by 2050.
To be on a climate path for 1.5 degrees by 2030, the IEA scenario envisions, among other things:
CCUS technologies for capturing and storing CO2, as well as hydrogen and its derivatives, are also important in order to keep the climate targets achievable by 2030. However, experience with CCUS technologies has been disappointing so far. Despite many announcements, final investment commitments are still lacking. The IEA says political support is needed to strengthen demand for this technology. nib
This summer, Europe groaned under record temperatures; there have been severe storms and floods, like recently in Greece and Libya: The climate crisis has long been part of our daily lives – and many are very worried about its effects. Many voices in politics and the media repeatedly warn of millions of “climate refugees” from Africa and other regions of the Global South who could soon be pouring into Europe.
Eight years after the refugee crisis, the migration debate is again shaping politics, unrelated to global warming. German municipalities complain about being overwhelmed, and German politicians argue about border controls and upper limits. On the Italian island of Lampedusa, EU Commission President Ursula von der Leyen and Italian Prime Minister Giorgia Meloni recently presented a ten-point plan against irregular immigration.
The climate crisis will likely intensify migration movements. But is the scenario of a massive, climate-driven migration movement towards Europe tenable at all? And what would an appropriate political approach to the challenges of “climate migration” look like?
To be clear from the start: A rush of climate refugees to Europe’s external borders is rather unrealistic – even if the current images from Lampedusa indicate otherwise. This is because research on the connection between climate change and migration concludes that migration and refugee movements in connection with the effects of climate change occur almost exclusively inside affected countries and regions.
People in the Global South generally migrate intra-regionally. According to the International Organisation for Migration (IOM), the share of intra-regional migration in West Africa, for example, is around 90 percent. The majority of groups mainly affected by the climate crisis are poor people, like small farmers, who lack the necessary means to migrate towards Europe.
Moreover, the link between climate and human migration is by no means simple arithmetic that can be calculated with a formula like “0.1 degrees increase in global average temperature results in x million climate refugees.” Migration and flight processes are complex. They are affected by political, social or economic factors, even in regions already severely affected by today’s climate crisis. In addition, climate impacts often mean that people tend to lose mobility as they lose essential resources.
This is why the supposed threat of a massive climate-induced refugee crisis tends to distract from the real challenges posed by climate change and the resulting migration.
On the one hand, we in Europe must prepare that many people here will also have to leave their homes around the middle of the 21st century. Due to the expected rising sea levels alone, millions of people in coastal areas of Europe are at risk. Even if this danger may not seem so acute today, politicians and societies must consider how to cope with this colossal challenge.
So far, there seems to be a lack of concern in this regard. Indeed, European countries and regions are already planning their longer-term adaptation options. But what if, for instance, sea levels rise faster after 2050 than previously expected? What if adaptation is no longer technically or financially feasible for certain areas, forcing people to leave permanently? These resettlement measures need a comprehensive and carefully planned dialogue and planning process to minimize the social and economic losses for all parties affected. Getting it started is a daunting task for governments and authorities.
But the processes of flight and migration taking place in the context of the climate crisis in other parts of the world also impact us in Europe. Admittedly, the interrelationships are complex. But both the consequences of climate change itself and the migration movements it contributes to pose considerable challenges for many countries in the Global South. They also increase the potential for increased conflict and instability. This cannot be in Europe’s interest.
International forums, processes and organizations, as well as national governments or development organizations, have been dealing with climate migration for some time – especially in affected global regions such as the Caribbean or the Horn of Africa. Their activities often aim to create a shared awareness of the problem among decision-makers and to initiate a political dialogue. In this respect, Europe does not only have a responsibility due to geostrategic considerations, but it also has an ethical obligation as one of the main contributors to man-made climate change.
Specifically, there are five areas in which the EU and its member states must provide support:
Preparing for more climate migration at home, while also providing better support to partner countries in the Global South in the climate crisis to prevent people from having to leave their homes: That would be a good political way to deal with climate migration.
Benjamin Schraven is an Associate Researcher at the German Institute of Development and Sustainability (IDOS) and has recently published a book on climate migration.
European environmental and climate policy has accompanied Linda Kalcher since her university studies. After earning a bachelor’s degree in Romance languages and literature in Bonn and Florence, she studied European culture and economy at the Ruhr University in Bochum. There, she also was the spokesperson for the master’s program, a liaison for 80 students from all over the world. “A precursor to working later in parliament,” says Kalcher.
Kalcher has lived in Brussels for twelve years and speaks six European languages. She spent the first six years working in the office of long-time German SPD environmental politician Jo Leinen, before joining the European Climate Foundation (ECF). Last year, she took on the additional role of Senior Advisor to the Secretary-General of the United Nations.
Asked what the EU can learn from the UN’s climate policy, Kalcher urges Europeans to show more solidarity with the Global South. The fact that investments in their transformation are being neglected and that pledge of the annual payment of 100 billion US dollars for climate financing, promised back in 2009, remains unfulfilled, particularly benefits China on a geopolitical level. At the same time, it harms the credibility of Europe and developed countries.
To alert decision-makers to grievances like these and advise policymakers, she founded the Strategic Perspectives think tank in October 2022. While the ECF works primarily on project funding and financing, Kalcher now reconnects with members of parliament on climate policy.
According to Kalcher, the think tank’s work also fills a niche: Although some think tanks already work at the national and European level of environmental policy and others at the European and international level – hardly any think tanks target all three political levels.
In mid-May, Kalcher and her colleague Neil Makaroff released the first Strategic Perspectives report. In collaboration with Cambridge Econometrics, the authors model the effects of the Green Deal and Repower-EU and offer recommendations for their successful implementation. They also collected examples of socially responsible climate policies from across Europe, such as the heat levy in the Czech Republic and the German 49-euro train ticket.
Kalcher looks to the future with optimism: “We’ve found that the climate targets are still achievable by 2030, and that 500,000 net new jobs can be created in the process.”
What surprised her about the results, however, was that the share of natural gas in energy supply is declining at a relatively slow pace. “One reason for this is the massive expansion of LNG terminals in Italy, Germany and France.” When measures like these are met with incomprehension in Europe, Kalcher feels it is important to keep all perspectives in mind and explain them to the governments of various countries – including those outside of Europe.
The current situation shows that this is not always easy: “A debate about heat pumps like the one in Germany is not taking place in countries like France, the Czech Republic or Poland.” There, sales figures have increased significantly since 2022 – thanks partly to government subsidies – following the Ukraine war. So, the reason why heat pumps are so controversial in Germany is one of the questions currently preoccupying Kalcher when it comes to European energy policy. Carlos Hanke Barajas
More than ever, time is short in climate policy. That’s why we should discuss the important things. Easier said than done, as our Climate.Table shows today. We have collected examples of where serious debates have sometimes fallen short so far.
Everyone is talking about the urgent need to develop renewables around the world. But rarely does anyone – like our colleague Nico Beckert – point out that this development makes little sense without expanding power grids. Many are debating whether global warming can still be limited to 1.5 degrees. But we have found for you in the IEA’s report what that would take: Three times as much renewables, 4.5 trillion dollars of investment annually, no new gas, oil and coal projects. That’s what it’s about.
There is also a lot of arguing about CCS. But little is said about how this dispute paralyzes Germany’s climate policy and alienates traditional allies – when internal debates limit Germany’s international political capabilities, as happened last week in New York. And finally, the migration debate is boiling up again, but an important aspect remains unmentioned: How is Europe preparing for European climate refugees in Spain or Greece who may lose their homes? Our opinion piece today touches on this overlooked question.
We hope you enjoy reading and hopefully gain some new insights,
Germany’s position in international climate policy is weakened by disputes in its government coalition. The coalition partners disagree on the path to a global phase-out of fossil fuels. As the government could not find a common position on whether such a phase-out should be demanded with or without carbon capture and storage (CCS/CCU), Chancellor Olaf Scholz refused to sign a corresponding declaration by the High Ambition Coalition (HAC) last week. Usually, Germany is one of the most important and progressive countries in the HAC on the international stage. Since the Paris climate summit, the HAC has been uniting countries across all UN groups that advocate for more and more vigorous climate action.
On the occasion of UN Secretary-General António Guterres’ Climate Ambition Summit on September 20, the HAC published an urgent appeal for more ambitious climate efforts. The text by the heads of state and government calls for, among other things, stricter renewable energy and energy efficiency targets and more climate financing to achieve the global climate goals. But the text also calls for a systemic transformation “across all economic sectors, driven by a global phase-out of fossil fuels.” The text further says: “Abatement technologies have a role to play in reducing emissions, but that role in the decarbonization of energy systems is minimal. We cannot use it to green-light fossil fuel expansion.”
Scholz did not support the wording accepted by 20 heads of state and government from countries including France, Austria, Chile, Belgium, Spain, Denmark, Barbados, Tuvalu and Kenya. It touches on one of the crucial questions of this year’s COP: Should the phase-out include all forms of fossil fuels – or only “unabated” forms, i.e., energy production without CCS/CCU?
In response to a question from Table.Media, a spokesperson for the German government said that while Germany “fundamentally supports the goals of the High Ambition Coalition, the version submitted went beyond wording previously agreed at the international level.” Moreover, “there was no conclusive position within the Federal Government,” which is why Germany abstained from signing the statement. The “agreed wording” refers to the final declaration of the G7 summit in Japan, which also only mentions the rapid phase-out of “unabated fossil fuel.”
According to information from Table.Media, there had previously been disagreement between the Green-led Foreign Office and the FDP-led Federal Ministry of Finance during the internal coordination within the government. While Foreign Minister Annalena Baerbock has repeatedly urged that the upcoming COP28 in Dubai must agree to end the use of all fossil fuels, the ministry led by Finance Minister Christian Lindner favors “technology openness” – and that also means the use of CCS/CCU in the energy sector.
Sources in the Ministry of Finance say that the “overall economic development must be kept in mind.” A “renunciation of the addition of ‘unabated’ would have massive economic effects, as operating certain industries where fossil energy cannot be easily replaced would no longer be possible. This would only lead to migration tendencies, but not serve climate action as a whole.” This reasoning, it emphasizes, has “already found its way into the position of the federal government as a whole in various places.”
Lindner’s ministry is not alone in this demand. COP President-elect Sultan Al Jaber, Minister of Industry of the United Arab Emirates and CEO of the state-owned oil and gas company Adnoc, also advocates the end of unabated fossil fuels. Globally, oil and gas producing countries mainly oppose the demand to leave fossil fuels in the ground.
By contrast, climate groups and island nations fear that such wording at COP28 could result in the unchecked continuation of the fossil fuel business model. Furthermore, this could delay urgently needed investments in renewables and postpone emission reductions into the future by referring to possible CCS technologies. It would be doubtful whether global greenhouse gas emissions could be halved by 2030, which is needed to meet the 1.5 limit, according to the Intergovernmental Panel on Climate Change (IPCC), if CCS technology were to slow down the rate of renewables. As the International Energy Agency recently stated, CCS/CCU has so far failed to meet expectations. Greater political support and faster progress are needed to achieve a breakthrough with CCS/CCU.
Nevertheless, the front of countries advocating leaving fossil fuels in the ground and using CCS/CCU only for practically unavoidable emissions is crumbling. At least, that is also the position of German climate and economics minister Robert Habeck, whose ministry is currently working on a “carbon management strategy.” The plans are intended to allow German companies to export their unavoidable CO2 emissions, for example, from the steel or cement industry, from Germany via ship, truck or pipeline and deposit them in Danish or Norwegian storage facilities under the North Sea. But Habeck’s strategy explicitly does not involve a CCS/CCU solution for emissions from the energy sector, like the one the UAE has in mind.
However, the EU has now also followed the UAE’s line. It is now merely calling for an energy system “free of unabated fossil fuels.” EU Commission President Ursula von der Leyen reiterated this position at Guterres’ summit in New York. Whether this position, i.e., agreeing with the demands of the UAE and other oil and gas producers, will also become the official negotiating position of the EU at COP28 in December will be decided by the EU in October.
Scholz’s abstention on the demand for a hard exit further weakens the HAC on this point. In her negotiations, for example, at the COP, Baerbock could also face the perception that she lacks the support in her own cabinet for this.
However, the German Chancellor’s speech at Guterres’ Climate Ambition Summit again adopted Baerbock’s tough phase-out formulation: “In Dubai, we will all need to make a strong decision to phase out fossil fuels, first and foremost coal.” There was no mention of “unabated” – but then, the focus was on coal, not oil or gas.
The triumphant progress of renewables seems to be unstoppable. China installed almost 100 gigawatts of new solar capacity in the first seven months of this year, already surpassing the record year of 2022. The sector has also grown rapidly in the US in recent years. But power grids are not being expanded fast enough and threaten to slow down the energy transition.
Without a modern power grid, green energy won’t reach electric steel mills, EVs and heat pumps that make up a green economy. According to the think tank Bloomberg NEF, global power grids need to be expanded to 152 million kilometers by 2050 to achieve climate goals – twice the existing length. This expansion would require 21 trillion dollars in global investments by 2050, with more than a third of these investments needed in China and the United States. If these two countries do not expedite their grid expansions, the energy transition could be seriously threatened, warn experts.
The US power grid could become one of the biggest bottlenecks in the country’s energy transition. According to a Princeton University study, the grid would have to be expanded twice as fast as in the last decade for the Inflation Reduction Act (IRA), the billion-euro program for the green transformation of the United States, to achieve its full effect. The study says that if expansion is not ramped up, more than 80 percent of the potential emissions reductions from IRA measures could be lost.
According to Princeton researchers, the network expansion has already achieved similar growth rates in the past. But the US faces significant challenges in this regard:
The local power grid is already at capacity in many parts of the country. This threatens to slow down the energy transition, as individual developers of new power plants have to pay both for the connection to the local power grid and for its expansion if newly built power plants push the grid to its capacity. Such grid expansion can massively drive up the cost of new wind and solar farms, forcing some project developers to abandon them. In addition, project developers sometimes withdraw their construction applications if they have to pay for grid expansion. The New York Times reports that they submit numerous applications and only build projects where other project developers bear the costs of grid expansion.
In addition, project developers now have to wait almost twice as long for connection to the power grid as they did between 2000 and 2010. Back then, it took an average of 2.1 years for a new power plant to be connected to the grid – now it’s 3.7 years. The authorities are overstretched due to the flood of new applications. To speed up the power grid expansion, the US federal government has provided 29 billion US dollars under the Infrastructure Investment, the Jobs Act and the IRA. But as Bloomberg NEF notes, these investments are not enough to achieve net-zero emissions by 2050.
China has experienced grid limitations impeding its energy transition in the past. In the early and mid-2010s, many new wind and solar parks remained idle because of inadequate grid connections between Chinese provinces and artificial barriers to power trading between provinces. During that period, curtailment rates (the amount of unused energy) reached as high as 40 to 50 percent. This meant that wind and solar power plants were constructed but left unused because the grid could not handle the additional electricity. Consequently, the construction of several new solar and wind power plants was halted for years.
While the situation has improved significantly since then, the recent boom in solar and wind energy presents new challenges that could once again hinder China’s energy transition:
China is expected to invest slightly more than 80 billion euros in expanding its power grid this year. While this is a substantial sum, it falls short of what is needed. Investments should be increased to match the record-high investments in renewable power generation, says Run Zhang, China Project Manager at Agora Energiewende.
“The imbalance between record-high investment in renewable generation and relatively low investment in the power grid may be a barrier to accelerating China’s clean energy transition,” says Kevin Tu of Agora Energiewende.
The new records in renewable energy expansion “will test the limits of China’s power system,” write Trivium experts. “A return to persistently high curtailment rates could force policymakers to once again slow the construction of new facilities.” Even if policymakers can resolve grid constraints, additional challenges remain: China’s electricity market is still highly inflexible and power trading across provincial borders is hindered by political interests and bureaucratic hurdles – further impeding the energy transition.
According to EU Commission President Ursula von der Leyen, only 23 percent of global greenhouse gas emissions are currently subject to a CO2 price, which would bring in $95 billion in revenue, she said last week at the UN climate summit in New York – and added to the sum with a thought experiment: imagine the revenue that would be generated for investments in low- and middle-income countries if the 60 percent of global greenhouse gas emissions targeted by UN Secretary-General António Guterres could be covered by 2030.
At the EU level, an instrument is being launched this weekend to help persuade countries outside Europe to put a CO2 price on their most climate-damaging industries – similar to what the EU ETS already does. CBAM imposes a tariff equal to the European CO2 price on emissions-intensive manufactured products imported into the EU. If the emissions in the country of manufacture are already subject to a CO2 price, the duty is discounted by this amount.
Admittedly, the ostensible purpose of the instrument is to protect European industry from competitive disadvantages and carbon leakage – the relocation of emissions-intensive operations to third countries. But EU legislators emphasized early on that CBAM should also motivate non-European countries and regions to introduce their own CO2 prices. This is the only way they can avoid or at least limit the CBAM levy in trade with the EU.
In fact, there were first tentative imitators even before the CBAM was finally adopted. Turkey had long resisted a CO2 levy, but after the CBAM was presented in 2021 it conceded that the instrument would be an incentive to restructure its own industry with the help of the EU, to make it future-proof and to adapt it to the Green Deal. Although there is still no Turkish ETS, planning is underway.
Following the European model, Australia reformed its emissions trading system this year and introduced a CO2 price for its most emissions-intensive industrial plants as recently as July. As with the EU ETS, the emissions cap falls year by year, forcing plants to reduce their greenhouse gas emissions. Meanwhile, Australia is also planning a CBAM to protect its own markets from climate-damaging imports from abroad. The government now wants to take a close look at the European CBAM and submit its own proposal for imports of steel and cement next year.
In Indonesia, too, work is proceeding at full speed on a CO2 price. Voluntary certificate trading has already been launched to finance the transformation of the energy sector. Now a mandatory CO2 price is to follow for other sectors as well. Indonesia wants to adopt international standards so that it can also offer its carbon credits to foreign buyers.
That there are not only quick imitators of the most important European climate protection instruments is shown in particular by India. 19 percent of India’s exports go to the EU. In 2022, they were worth over €9 billion in the CBAM sectors of aluminum, fertilizer, electricity, cement, hydrogen, and iron and steel. The Indian steel and aluminum industry in particular is concerned about the CBAM price premium because the CO2 intensity of the domestic industry is significantly higher than the global average.
India has therefore expressed considerable reservations about the CBAM and has also presented these to the WTO. This is also about fairness between the European industrialized countries and the emerging country India. Suranjali Tandon, a professor at the National Institute of Public Finance and Policy in New Delhi, criticizes the CBAM as imposing the EU’s transition speed on developing countries. Since developing countries do not have CO2 pricing, the EU would earn from their exports through the CBAM. While this is a discriminatory measure, it also offers opportunities, he said. “Developing countries can build markets and impose domestic taxes that not only support their efforts to achieve net-zero targets, but also better articulate the potential limits to pricing that are consistent with development priorities and highlight the inaction of developed countries.”
India is therefore considering regulatory responses. Under discussion is a separate CO2 tax for export goods to the EU that meets the CBAM criteria for rebates. If introduced, India would earn from the CO2 price instead of the EU. Another option, and a retaliatory measure of sorts, is to impose a countervailing tax on imports from the EU to India. However, India is threatening to violate WTO guidelines itself by doing so. India is also in the process of introducing emissions trading.
In the United States, too, there are proposals for a CO2 border adjustment to protect the country’s own industry from foreign competitors. Ideas for this are supported by Democrats and Republicans. However, the effort has so far foundered on the question of whether it would take a national CO2 price to impose a CBAM on foreign imports. Republicans do not want such a price – but imposing a CBAM without a national CO2 price would not comply with WTO rules. The Democrats, on the other hand, have already introduced a CO2 price in twelve states.
Brazil, under President Lula da Silva, has also announced an emissions cap for large polluting companies and the creation of a regulated carbon market. A CO2 price is part of the plan. Around 5,000 companies from the steel, aluminum, cement as well as chemical industries that emit more than 25,000 metric tons of CO2 annually are to be affected. It is not yet known how high the cap will be set, but it is to fall gradually in line with the European model.
It is true that Brazil is an important trading partner for Europe, mainly because of its agricultural exports – and these are not affected by the CBAM. But steel and iron, aluminum, fertilizers and cement are also high on Brazil’s export list. In addition, Brazil could become Europe’s oil supplier in the future, and there is already consideration of extending the CBAM to all fossil fuels in the next step.
China has had a functioning emissions trading system since 2021 – the year the EU launched its Fit For 55 package and a landmark reform of the ETS. It covers around four billion tons of CO2 and over 40 percent of the country’s greenhouse gases, but so far it only affects larger coal and gas-fired power plants. Expansion to all industrial sectors has been repeatedly postponed and is currently scheduled for 2025, a year before financial compensation is due for the first time at the EU’s external borders under the CBAM. To be sure, there are still significant flaws in China’s CO2 price. But the goal is obvious: avoid EU border tariffs. With Urmi Goswami
Replacing internal combustion cars with EVs will not be enough to meet Germany’s climate targets, according to a new analysis by the NGO Transport and Environment (T&E). Cars with combustion engines would also have to stay home much more often. According to T&E’s calculations, the number of kilometers driven with internal combustion engines will have to decrease by 55 percent by 2030 compared to 2018. Even under the optimistic assumption of 15 million EVs on German roads by 2030, vehicle kilometers would have to decrease by 24 percent overall by 2030. Otherwise, the climate targets for the transport sector are impossible to meet.
T&E analyst Benedikt Heyl says: “Money remains available for the expansion of autobahns, while follow-up funding for the 49-euro ticket hangs in the balance.” “Individual mobility in cars” should not be promoted “at taxpayers’ expense,” T&E criticizes. The organization advocates affordable local and long-distance public transport. nib
According to new research by Carbon Brief, carbon offset projects in forests are not only often greenwashing, they also have a negative impact on the ground. They report that such projects often harm local and indigenous communities. Moreover, their ability to bind CO2 is often overestimated. In addition, they can harm food production and are, in some cases, linked to illegal land. Carbon Brief examined numerous media reports and analyses by the Environmental Justice Atlas.
The expert portal compiled reports on the negative impacts of offset projects from all regions of the world. In Latin America, 15 of 19 reports involved projects in the Amazon rainforest.
In the recent past, carbon offset projects have repeatedly been criticized. Most recently, for example, a study by the Berkeley Carbon Trading Project criticized offset projects in the rainforest as ineffective and setting the wrong incentives. At the same time, the number of offset certificates sold through them increased sharply. kul
Time is running out, but global warming can still be kept below 1.5 degrees thanks to the dynamic growth of renewable energies, writes the International Energy Agency (IEA) in its updated net-zero scenario for the energy sector. To keep the climate targets achievable, however, countries must massively step up investment in the energy transition and stop investing in expanding the extraction and burning of fossil fuels.
Accordingly, an annual investment of 4.5 trillion US dollars would be required worldwide in the early 2030s. For this year, the IEA forecasts record investment in clean energies of 1.8 trillion US dollars. Developing and emerging countries, in particular, would have to invest more in the energy transition and require international support of 80 to 100 billion US dollars annually in loans at preferential conditions.
According to IEA calculations, carbon emissions from the energy sector must fall by 35 percent and demand for fossil fuels by 25 percent by 2030. This could be achieved if renewable energies are expanded swiftly enough and coal-fired power plants are taken off the grid more quickly. Then, new oil and gas production and new coal mines or power plants would no longer be required for a secure power supply.
Although carbon emissions from the energy sector reached a global peak of 37 billion metric tons in 2022, the IEA believes that the energy sector is changing faster than many think:
However, the IEA says that much more needs to be achieved. By 2035, carbon emissions from the energy sector must be reduced by 80 percent in wealthy countries and by 60 percent in emerging and developing countries compared to 2022. The countries’ climate targets are insufficient to achieve net zero emissions by 2050.
To be on a climate path for 1.5 degrees by 2030, the IEA scenario envisions, among other things:
CCUS technologies for capturing and storing CO2, as well as hydrogen and its derivatives, are also important in order to keep the climate targets achievable by 2030. However, experience with CCUS technologies has been disappointing so far. Despite many announcements, final investment commitments are still lacking. The IEA says political support is needed to strengthen demand for this technology. nib
This summer, Europe groaned under record temperatures; there have been severe storms and floods, like recently in Greece and Libya: The climate crisis has long been part of our daily lives – and many are very worried about its effects. Many voices in politics and the media repeatedly warn of millions of “climate refugees” from Africa and other regions of the Global South who could soon be pouring into Europe.
Eight years after the refugee crisis, the migration debate is again shaping politics, unrelated to global warming. German municipalities complain about being overwhelmed, and German politicians argue about border controls and upper limits. On the Italian island of Lampedusa, EU Commission President Ursula von der Leyen and Italian Prime Minister Giorgia Meloni recently presented a ten-point plan against irregular immigration.
The climate crisis will likely intensify migration movements. But is the scenario of a massive, climate-driven migration movement towards Europe tenable at all? And what would an appropriate political approach to the challenges of “climate migration” look like?
To be clear from the start: A rush of climate refugees to Europe’s external borders is rather unrealistic – even if the current images from Lampedusa indicate otherwise. This is because research on the connection between climate change and migration concludes that migration and refugee movements in connection with the effects of climate change occur almost exclusively inside affected countries and regions.
People in the Global South generally migrate intra-regionally. According to the International Organisation for Migration (IOM), the share of intra-regional migration in West Africa, for example, is around 90 percent. The majority of groups mainly affected by the climate crisis are poor people, like small farmers, who lack the necessary means to migrate towards Europe.
Moreover, the link between climate and human migration is by no means simple arithmetic that can be calculated with a formula like “0.1 degrees increase in global average temperature results in x million climate refugees.” Migration and flight processes are complex. They are affected by political, social or economic factors, even in regions already severely affected by today’s climate crisis. In addition, climate impacts often mean that people tend to lose mobility as they lose essential resources.
This is why the supposed threat of a massive climate-induced refugee crisis tends to distract from the real challenges posed by climate change and the resulting migration.
On the one hand, we in Europe must prepare that many people here will also have to leave their homes around the middle of the 21st century. Due to the expected rising sea levels alone, millions of people in coastal areas of Europe are at risk. Even if this danger may not seem so acute today, politicians and societies must consider how to cope with this colossal challenge.
So far, there seems to be a lack of concern in this regard. Indeed, European countries and regions are already planning their longer-term adaptation options. But what if, for instance, sea levels rise faster after 2050 than previously expected? What if adaptation is no longer technically or financially feasible for certain areas, forcing people to leave permanently? These resettlement measures need a comprehensive and carefully planned dialogue and planning process to minimize the social and economic losses for all parties affected. Getting it started is a daunting task for governments and authorities.
But the processes of flight and migration taking place in the context of the climate crisis in other parts of the world also impact us in Europe. Admittedly, the interrelationships are complex. But both the consequences of climate change itself and the migration movements it contributes to pose considerable challenges for many countries in the Global South. They also increase the potential for increased conflict and instability. This cannot be in Europe’s interest.
International forums, processes and organizations, as well as national governments or development organizations, have been dealing with climate migration for some time – especially in affected global regions such as the Caribbean or the Horn of Africa. Their activities often aim to create a shared awareness of the problem among decision-makers and to initiate a political dialogue. In this respect, Europe does not only have a responsibility due to geostrategic considerations, but it also has an ethical obligation as one of the main contributors to man-made climate change.
Specifically, there are five areas in which the EU and its member states must provide support:
Preparing for more climate migration at home, while also providing better support to partner countries in the Global South in the climate crisis to prevent people from having to leave their homes: That would be a good political way to deal with climate migration.
Benjamin Schraven is an Associate Researcher at the German Institute of Development and Sustainability (IDOS) and has recently published a book on climate migration.
European environmental and climate policy has accompanied Linda Kalcher since her university studies. After earning a bachelor’s degree in Romance languages and literature in Bonn and Florence, she studied European culture and economy at the Ruhr University in Bochum. There, she also was the spokesperson for the master’s program, a liaison for 80 students from all over the world. “A precursor to working later in parliament,” says Kalcher.
Kalcher has lived in Brussels for twelve years and speaks six European languages. She spent the first six years working in the office of long-time German SPD environmental politician Jo Leinen, before joining the European Climate Foundation (ECF). Last year, she took on the additional role of Senior Advisor to the Secretary-General of the United Nations.
Asked what the EU can learn from the UN’s climate policy, Kalcher urges Europeans to show more solidarity with the Global South. The fact that investments in their transformation are being neglected and that pledge of the annual payment of 100 billion US dollars for climate financing, promised back in 2009, remains unfulfilled, particularly benefits China on a geopolitical level. At the same time, it harms the credibility of Europe and developed countries.
To alert decision-makers to grievances like these and advise policymakers, she founded the Strategic Perspectives think tank in October 2022. While the ECF works primarily on project funding and financing, Kalcher now reconnects with members of parliament on climate policy.
According to Kalcher, the think tank’s work also fills a niche: Although some think tanks already work at the national and European level of environmental policy and others at the European and international level – hardly any think tanks target all three political levels.
In mid-May, Kalcher and her colleague Neil Makaroff released the first Strategic Perspectives report. In collaboration with Cambridge Econometrics, the authors model the effects of the Green Deal and Repower-EU and offer recommendations for their successful implementation. They also collected examples of socially responsible climate policies from across Europe, such as the heat levy in the Czech Republic and the German 49-euro train ticket.
Kalcher looks to the future with optimism: “We’ve found that the climate targets are still achievable by 2030, and that 500,000 net new jobs can be created in the process.”
What surprised her about the results, however, was that the share of natural gas in energy supply is declining at a relatively slow pace. “One reason for this is the massive expansion of LNG terminals in Italy, Germany and France.” When measures like these are met with incomprehension in Europe, Kalcher feels it is important to keep all perspectives in mind and explain them to the governments of various countries – including those outside of Europe.
The current situation shows that this is not always easy: “A debate about heat pumps like the one in Germany is not taking place in countries like France, the Czech Republic or Poland.” There, sales figures have increased significantly since 2022 – thanks partly to government subsidies – following the Ukraine war. So, the reason why heat pumps are so controversial in Germany is one of the questions currently preoccupying Kalcher when it comes to European energy policy. Carlos Hanke Barajas
