Bitter Reality

World Lacks Any Credible Institutional Capacity to Deal with Climate Change

Vinod Mubayi

The painful truth that emerges from the recent series of extreme weather events around the world as well as energy sector developments in the major countries, including China, the US, and India, is that the world lacks any meaningful institutional framework or ability to deal with the major factor influencing climate change, viz. the greenhouse gas emissions caused by fossil fuel use. Yes, there is the Conference of Parties, COP, sponsored by the United Nations, consisting of representatives from all countries that meets every year in different locations where leaders of each country make pronouncements and promises to curb their national carbon emissions, and agree on policies to limit global temperature rise and adapt to climate change. The next meeting, COP 28, will be held towards the end of 2023 in the oil and gas producing Gulf area of Dubai, UAE. Ironically, the president of this conference will be an oil man Sultan Jaber who heads Dubai’s Ministry of Energy. So far, over the several decades these UN meetings have been taking place, carbon emissions and global temperatures have kept rising. The decision-makers in industry and the banking system who fund major extractive projects and also grease the wheels of the political system seem to have a restricted vision: a vision limited by the horizon of their profit margins. Naturally, one cannot blame them individually for continuing to provide billions to oil and gas companies to explore, drill and produce, after all they have a so-called fiduciary responsibility to maximise the financial returns to their shareholders. They are part of an overall capitalist system where production of any commodity is premised on profitability. At the present time, the profitability of oil and gas production is very high so it is no surprise that it is surging and no political leader in the major oil producing countries wants to curb oil and gas production, or, in China and India coal production, despite the proven danger carbon emissions pose to the planet. At the same time, in the US, the country that has historically been by far the largest consumer of fossil fuels and thus the largest source of GHG emissions, one of the major political parties whose candidate may well win next year’s presidential election has just released a report pledging to increase and accelerate the production of oil, gas, and coal. Such a development, if it comes to pass, may well rank as a stunning example of a crime against humanity; unfortunately, the planet lacks any conceivable jurisdiction where such a crime could be prosecuted.

Alongside the continuing use of fossil fuel and GHG emissions, there is news about the rapid and accelerating deployment of non-fossil sources of energy, in the electric power production sector, in transport vehicles, and in energy use in buildings. Due to the steep fall in the prices of solar photovoltaic panels, wind turbines, and batteries there is a rapid increase in the production of utility-scale electric power from solar and wind sources;there is also a rapid growth of all-electric automobiles, and there are plans in place for the future replacement of natural gas in the buildings sector by electricity. The financial incentives provided by the legislation sponsored by the Biden administration are credited with significantly accelerating this transition in the US; to a lesser or greater extent similar progress in renewable energy is occurring in other countries also. Despite these positive developments, the key question remains however: can the amount of GHG emissions be reduced on a time scale such that the rise in average global temperature is restricted to 1.5 degrees Celsius, the amount set by the Intergovernmental Panel on Climate Change (IPCC), the international body of scientists studying climate change, to keep the world’s weather within safe limits? An answer to this question must consider the fact that world oil consumption according to data from the International Energy Agency (IEA) is currently approaching a record level of 103 million barrels per day (mbpd). Furthermore, the Organisation of Petroleum Exporting Countries (OPEC) projects that this amount will increase by another 2.4 mbpd next year.
To get an approximate idea of how far the world is from any meaningful handle on the problem of climate change it is useful to briefly review the publicly available plans of oil, gas, and coal production in the three largest carbon emitting countries: China, #1, US, #2, and India #3.

China is the world’s single largest emitter of energy related greenhouse gases amounting to almost a third of world output, more than the US, Japan and Europe combined. The reason is that China produces and consumes more coal than the rest of the world combined. China is also building more than a hundred coal-based power plants that will continue to spew the GHG carbon dioxide into the atmosphere when operational. However, China presents an interesting paradox as it is also the world’s leader by a significant margin in solar and wind power with an installed solar power capacity, for example, almost four times greater and a wind capacity approximately three times larger compared to that of the US. So, while China can claim that it will reduce carbon emissions through the solar and wind installations, it is unclear if the additional coal power capacity will offset that reduction.

United States
The US is now the world’s largest oil and gas producer if shale oil and gas produced by hydrofracking is included and is very likely to retain that position for the foreseeable future. Although a large amount of media commentary has highlighted the Biden Administration’s “historic” climate legislation passed last year that has provided hundreds of billions of dollars to the renewable energy industry, the hard fact remains that oil and gas production in the US is set to grow even as coal production goes down. Besides the huge $8 billion Willow oil project on Alaska’s North Slope, there are many more oil and gas projects that have been or are in the process of being approved. While Biden campaigned on a pledge of banning oil and gas leases on federal lands, his administration recently unveiled a new regulatory framework that permits new leases but significantly increases the low, outdated fees of an earlier era that were charged to the bidding companies. Environmental groups strongly slammed this proposal saying:"Any rule that fails to phase out oil and gas production on public lands will sacrifice human lives, ecosystems, and entire species at the altar of fossil fuel corporations and their insatiable quest for profit." This opposition, however, is unlikely to have much impact on actual production. Meanwhile, the Heritage Foundation, a conservative think tank that develops policy and strategy for the Republican Party, has unveiled a plan to eliminate most current clean energy progra-mmes to eliminate GHG carbon emissions as well as boost fossil fuel production if a Republican Administration takes power in 2025. Knowing what people already do about the science underlying climate change, the plan’s call for dismantling regulations aimed at reducing carbon emissions, couched in the familiar ideological language of “let the market decide,” appears almost comically designed to promote Ignorance as a national policy. It would indeed be risible were its consequences not so dire for life on this planet.

India, like China,is set to increase its coal production quite significantly over the next year from about 730 million tons in the 2022-23 fiscal year to around 1 billion tons in the next year. Coal accounts for almost three quarters of India’s electricity production and this is not expected to change much in the next few years despite the optimistic claims of the Indian government or the projections of the International Energy Agency. India also imports over 160 million tons of coal over half from Indonesia and lesser amounts from Australia, Russia and South Africa. India has reopened old mines and is destroying virgin old-growth forests in developing environmentally destructive open-cast surface or strip coal mines. In a new development under the current regime, India is privatising part of its coal production by providing long-term contracts to private mining companies, including the Modi govern-ment’s favourite crony, Adani, whose enterprises now account for a large share of India’s infrastructure of ports, airports, power plants and coal mines. At the 2021 Glasgow COP meeting, India, along with China, lobbied hard for the language “phase-out of coal” to be replaced by the milder “phase-down of coal” which in reality didn’t mean that either country would use less coal in absolute terms, only as a relative fraction of its projected energy consumption. Although at the COP 27 meeting last year in Egypt, India claimed that fossil fuels would only account for half or less of its electricity production by 2030, recent newspaper reports suggest that renewable energy production is not meeting targets and that dependence on coal will continue.

Other countries
Most countries in Western Europe had phased out the use of coal for electric power some years ago but the conflict in Ukraine followed by the suspension of supply of Russian natural gas has changed the situation. Germany restarted some mothballed coal power plants and postponed the closure of some operational ones. Some other countries such as France, Austria and Italy have also reactivated old coal power plants. While this re-emergence of coal in Europe is claimed to be temporary, it will delay plans to reduce carbon emissions. Japan consumes around 200 million tons of coal annually in the power and other industrial sectors. The tsunami-caused accident at the Fukushima nuclear power plant in 2011 that led to the closure of much of Japan’s nuclear plants means that coal and liquefied natural gas will continue to provide much of Japan’s power although the share of renewables is expected to increase.

Role of the Major Banking Institutions
The major banks provide the vital financial requirements of the entire fossil fuel industry and profit handsomely from doing so. They are thus as culpable as the oil, gas, and coal companies for the carbon emissions causing climate change. The amounts of money involved are immense by any reckoning and demonstrate why, among other reasons, it is so difficult to curb let alone halt fossil fuel production. From 2016 to 2022, the top 60 banks provided $5.5 trillion to fossil fuel companies; fully one quarter of this amount, around $1.4 trillion, was provided by just 4 big US banks: JP Morgan Chase, Citi, Wells Fargo and Bank of America.Despite paying occasional lip service to climate issues, the tycoons of the banking system appear to be squarely behind their fossil fuel investments. The example of Jaime Dimon, head of JP Morgan Chase, the biggest bank in the fossil fuel business, is instructive. In an article in Yahoo finance from August 2022 he is quoted as telling a gaggle of rich clients: “Why can’t we get it through our thick skulls” that America should “boost more oil and gas?”. An article in Bloomberg news quoted him telling the US Congress in September 2022 that the US needed to invest in more fossil fuels and he is also reported as saying if his banks stopped funding new fossil fuel products it would “be the road to hell for America”. Since the investments in the exploration, development and production of oil and gas for example are long-term investments extending over several decades, stopping fossil fuel production within a time frame dictated by global temperature rise of 1.5 degrees Celsius appears highly unlikely absent some extraordinary actions aimed at uprooting the global financial system.

Climate and Weather
The surface ocean temperature near the Florida Keys reached an unprecedented 38.5 degree Celsius (over 101 degrees Fahrenheit) in early August this year in what is very likely a global record as ocean heat ascends into hitherto uncharted territory. Other extreme weather events all over the globe have been occurring regularly and have been highlighted in the media. What is particularly concerning is that the existing infrastructure standards are based on data that is now being outpaced by climate change as stated in a new study. So, in the US for example, “once in a hundred years” rain events now occur at 20-year intervals, on average, and that interval will keep shrinking as long a fossil fuel consumption continues unchecked. In 2018, the IPCC released a special report on the impact of global warming when temperature reaches 1.5 degree Celsius above baseline and documented the destruction of ecosystems and irreversible changes that would occur if global temperatures reached or exceeded 2 degrees Celsius. It was estimated in the report that anthropogenic activities that had already caused 1 degree Celsius of global warming, were likely to cause a 1.5 degrees Celsius rise between 2030 and 2052 at the then current rate of carbon emission. This estimate now appears too optimistic based on the latest data and analysis.

The analysis presented in a very recent paper “Global Warming in the Pipeline” by the noted climate scientist James Hansen and his collaborators is worth quoting at length:

Under the current geopolitical approach to GHG emissions, global warming will likely pierce the 1.5°C ceiling in the 2020s and 2°C before 2050. Impacts on people and nature will accelerate as global warming pumps up hydrologic extremes. The enormity of consequences demands a return to Holocene-level global temperature. Required actions include: 1) a global increasing price on GHG emissions, 2) East-West cooperation in a way that accommodates developing world needs, and 3) intervention with Earth’s radiation imbalance to phase down today’s massive human-made “geo-transformation” of Earth’s climate. These changes will not happen with the current geopolitical approach, but current political crises present an opportunity for reset, especially if young people can grasp their situation.

Thus, the danger caused by climate’s delayed response and the need for anticipatory action to alter the course of fossil fuel development was apparent to scientists and the fossil fuel industry 40 years ago. Yet industry chose to long deny the need to change energy course, and now, while governments and financial interests connive, most industry adopts a “greenwash” approach that threatens to lock in perilous consequences for humanity. Scientists will share responsibility, if we allow governments to rely on goals for future global GHG levels, as if targets had meaning in the absence of policies required to achieve them.

This analysis indicates clearly that as long as fossil fuel consumption is permitted to proceed undisturbed, the so-called Nationally Determined Goals (NDG), targets for carbon reduction, presented by each country at the various COP meetings lack “meaning” as no credible policies to achieve them are presented. The world is hence confronted with a dire future in the absence of any global institutional capacity to cut carbon emissions.


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Vol 56, No. 17-20, Oct 22 - Nov 18, 2023