The Italian-led G7 recently unveiled its communique on climate change and energy security, marking both significant advancements and notable gaps in their approach.
One of the key positives is the reaffirmation of the UAE consensus achieved at COP28, signaling a unified stance among G7 nations. This comes at a critical time, especially with the EU's upcoming discussions in Baku, Azerbaijan, later this year, where the phrase \"transitioning away\" from fossil fuels is conspicuously absent from the EU's latest submission to the United Nations Framework Convention on Climate Change (UNFCCC).
Multilateralism stands at the forefront of addressing the intertwined crises of climate change and energy security, particularly amidst rising geopolitical tensions. While the G7's initiatives are commendable, their true impact hinges on the broader global cooperation that remains essential.
The inclusion of nuclear energy in the decarbonization agenda is a milestone, enhancing global competitiveness. However, the EU's 2030 climate targets are increasingly dependent on renewable energy expansion, given the lengthy timelines associated with nuclear projects.
Efforts to reduce carbon intensity in hard-to-abate sectors are laudable. Yet, the practicality of some proposed solutions, such as hydrogen for heating and transport and carbon capture technologies, remains uncertain due to technical and financial challenges.
The commitment to phase out coal by 2035 within G7 countries is a bold move, yet its global impact may be limited. Countries like China and India account for the majority of coal consumption for electricity, overshadowing the efforts of the US, Japan, and Germany combined.
Replacing coal presents its own set of challenges. A report by the Institute for Energy Economics and Financial Analysis (IEEFA) highlights that planned liquefied natural gas (LNG) storage facilities by 2030 could exceed Europe's gas demand by over 76% if renewable sources are tripled. Failing to achieve this, Europe may rely more on LNG from the US and Qatar, potentially undermining methane emission reduction commitments. Notably, the G7 communique does not address this contradiction between climate neutrality goals and existing climate-impacting infrastructure.
On a positive note, initiatives like the \"G7 Adaptation Accelerator Hub\" show promise in tackling climate challenges in vulnerable regions, complementing progress in the UNFCCC's Loss and Damage Fund.
The G7 aims to triple renewable energy capacity by 2030, approaching China's current expansion rate within just five years. In 2023, China’s renewable capacity was five times that of the US and four times that of the US and Australia combined. Countries like Brazil and India are also rapidly increasing their renewable capacities, setting ambitious targets of becoming the world's largest economy powered by renewable energy.
Critical minerals and rare earths will play a decisive role in the coming years. China's production of rare earths is significantly higher than that of the US and Australia combined, with Europe heavily reliant on Chinese imports for 98% of these materials.
The G7 emphasizes the need to diversify supply chains and reduce dependence on the Chinese mainland for key resources. However, the urgent push to develop renewable energy and electric vehicles within the next five years poses a challenge, as it doesn’t align with the necessary increase in extraction and processing of critical minerals required to meet climate neutrality goals.
Political decisions are often influenced by immediate risks and long-term trade-offs. Balancing the urgent threat of climate change with other geopolitical tensions, such as the conflict in Ukraine, complicates the path forward.
Swift action on climate risks and accelerated green reindustrialization are essential, yet they depend heavily on international collaboration and technological exchange, even with nations perceived as competitors. Building trust and fostering cooperation are critical for the G7 to develop innovative solutions and share expertise, ensuring that green initiatives advance without exacerbating global tensions.
The European Union plays a pivotal role in this landscape, especially in engaging with key players like the Chinese mainland. Developing mutually agreed standards and climate performance indicators can help create balanced trade agreements, mitigating industrial competitiveness issues. However, derisking comes with its own set of challenges, potentially limiting Europe's maneuvering space and impacting the competitiveness of European industries on the global stage.
Reference(s):
G7's climate strategy: Multilateralism is the only way forward
cgtn.com
