We have 12 years to stop the world from overheating by cutting global warming an extra half a degree, climate scientists warn. The response of the planet’s largest carbon emitters has been “cool”, but in the wrong way. Can the UK Government and UK business make a difference? Jon Herbert reports.

Should we change our lives fundamentally in a final attempt to save the world from the catastrophic temperature rises that climate experts and government representatives meeting recently in Incheon, South Korea say are all but inevitable without extreme intervention? Or will indifference from the world’s largest greenhouse gas (GHG) emitters squash the efforts of a small European island?

Everything now pivots not only on what governments and industries do, but also efforts of the planet’s growing population to keep maximum temperature rises not under the old 2°C limit but a much more demanding 1.5°C, the scientists add. The climate change battle has become personal.

The situation is now so dire that the 1.5°C target is likely to be breached around the year 2040. The world will then need to discover how to reabsorb carbon dioxide (CO₂) on a huge scale back from the atmosphere at colossal expense and effort. The longer the problem is left, the harder it will be.

What has changed so suddenly?

The received wisdom since the December 2015 UN Paris climate summit has been that the maximum additional surface temperature rise the world can take relatively safely is 2°C. That diagnosis has changed. In a 33-page Summary for Policymakers, the UN Intergovernmental Panel on Climate Change (IPCC) spells out clearly that 1.5°C is now the maximum.

Half a degree may not sound like much. But according to the report, it will make a traumatic difference to how we live — saying goodbye to red meat, milk and dairy products, sourcing seasonal food locally, throwing less away, using washing lines rather than tumble driers, walking, cycling or driving “clean” electric vehicles (EVs) when possible, using trains and roads rather than planes if we have to travel, video conferencing more, buying less fast fashion, wearing sweaters in winter and insulating buildings. In short, a ground-breaking cultural shift. But no one has suggested virtual holidays — yet!

As a good world citizen, the UK wants to respond positively. Business, Energy and Industrial Strategy Minister Claire Perry has asked the Committee on Climate Change (CCC) to show how Britain can become a zero-carbon society as soon as possible across the economy from homes, transport and industry to agriculture. We are already committed to a GHGs cut from a 1990 datum of 80% by 2050. That may no longer be sufficient. She has also asked for costs and comparative benefits.

From a business perspective, does this make sense? Will the restrictions of low-carbon working find compensatory outlets in new world markets? The Government says yes for a series of reasons. However, the planet’s largest carbon emitters seem to be heading in the opposite direction.

A global view

Literally seeing the world from above is not comforting. Recent satellite imagery shows that although central Government promised to curb China’s coal-fired power station building programme — it has issued suspension orders for more than 100 plants — almost all construction has gone ahead. Local Chinese authorities now have yes/no planning power and are loath to close down projects which they see as economic activity; many coal plants only operate for some 50% of the time.

Even so, China has 993GW of coal power capacity and is on course to increase this by some 25% to 259GW. The International Energy Agency (IEA) says that to keep warming below 1.75°C, China will have to close all its plants without carbon capture and storage (CCS) facilities in 30 years.

Down under

Australia is the world’s 13th largest emitter — China is number one — but its largest export is coal. Some 60% of its electricity comes from coal with 50,000 jobs. However, the political reaction to the IPCC’s findings was stark. Deputy Prime Minister Michael McCormack is reported to have confirmed there will be no government policy change “just because somebody might suggest that some sort of report is the way we need to follow and everything we should do”. Environment Minister Melissa Price added that the IPCC was “drawing a long bow” in calling for a global end to coal use by 2050 and trying to rely on new low-carbon technologies instead.

Australia’s coal problem is part-Indian however. The Adani Group is struggling to develop its controversial $16 billion Carmichael coal project near the World Heritage-listed Great Barrier Reef but predicts a six-fold rise in output by 2021. Exports to India are then expected to decline.

India itself is in flux over carbon, cars and coal. It is keen to put low-cost cars within the income range of ordinary families but also wants to move swiftly to renewables and EVs. The transition is not proving easy. Nearly all Indian coal plants breach the country’s air pollution standards. Many are expected to close by 2027. However, coal demand rose by 7.5% to some 900 million tonnes in the year to early March 2018, making India the world’s third largest GHG emitter.

As head of the world’s second largest GHG polluter, President Trump no longer believes climate change is a hoax but that climate change scientists have a “political agenda”. Warming is cyclical he says; he doesn’t want to “spend trillions of dollars and lose millions of jobs by cutting emissions”.

No more kicking the can

What climate scientists actually say is that the world must step up to the plate in a “final call” to avoid “rapid, far-reaching and unprecedented changes in all aspects of society”. Rather than 1.5°C, they calculate earth is heading towards a catastrophic 3°C rise that will affect global weather, food chains, sea levels, cause extreme and unpredictable droughts and floods and damage human health, commerce and economics, plus biodiversity.

The IPCC says there must be rapid and significant changes in four big global systems: energy, land use, cities and industry. It does not tell governments what to do but does suggest scenarios. At present, this means that 1.5°C will only be workable if technologies and policies exist to then claw carbon back through more real trees, “artificial” trees and untested mechanisms still on the drawing board. There are warnings that some changes will be irreversible. Which means it is better to cut faster and deeper now.

The genesis of the 2°C limit seems to have been the 1970s. European ministers adopted it in the mid-1990s; it became UN policy by 2010. The 1.5°C target was added to reassure low-lying islands that they wouldn’t be swamped.

However, there is now an additional fear that warming will trigger feedback mechanisms, turning carbon sinks like forests, frozen arctic tundra, peat and soils into carbon sources that further accelerate the problem. At the same time, seven million km² of land will be needed for energy crops — just less than the size of Australia.

And it will be costly. The 1.5°C target will need an average annual clean energy system investment of some $2.4 trillion up to 2035, or 2.5% of global gross domestic product (GDP). But this will be cheaper than trying to retrieve CO₂ from the atmosphere later in the century.

Fortress UK

This underlines the question of whether the UK on its own can make a difference and if opportunities exist for business? There are a number of answers. An obvious one is that someone has to show leadership.

If that sounds over-optimistic, then a more sanguine approach is that if and when impacts get worse, more people will want products and services designed to cope. Being a market leader then becomes hugely beneficial. By one estimate, the value of the world’s renewables market alone will be worth more than $2,000,000 million by 2025! There will be matching opportunities in food chains, health products and manufacturing.

However, there are solutions to be found first. Commenting on the IPCC recommendations, Claire Perry said, “The report was a really stark and sober piece of work — a good piece of work.” She is concerned about costs and who will pay, but adds, “The question is: what does Government need to do, where can the private sector come in, and what technologies will come through?”

From a business and supply chain opportunity perspective, it isn’t only low-carbon technology that counts but also innovations that help other enterprises to become more efficient, cutting costs by reducing energy bills, raising margins, lowering prices and becoming more competitive in vital sustainable markets. If all goes well there could be two million “green collar” jobs by 2030 generating up to £170 billion in annual exports for UK businesses.

Carbon neutrality

According to the Prime Minister, the UK Government intends “to legislate for a net zero emissions target at an appropriate point in the future”. Meanwhile, it joined 18 other nations in the Carbon Neutrality Coalition at the UN General Assembly’s 73rd session in New York recently.

However, green groups have been critical of environmentally damaging projects like Heathrow, fracking, freezing fuel duties, barriers against onshore wind power, an end to solar subsidies and the idea of zero-carbon homes and cutting back on some EV financial incentives.

Summary

• The UN IPCC has issued a “final warning” that the world has just 12 years left to curb global warming during this century to a rise of no more than 1.5°C if catastrophic life-changing environmental impacts are to be avoided.
• Meeting this deadline will be culturally demanding, requiring technology to “pull” CO₂ back out of the atmosphere, and horrendously expensive. But it will be cheaper and more effective than waiting longer.
• There are opportunities for a small committed island economy like the UK to make a difference and exploit huge future global export markets. This is not only through the development of innovative technology but also supply chain inputs that lower energy use and carbon emissions, reduce costs, increase margins and make companies more competitive.

Published by Croneri on 6 November 2018