With the world in the grip of a climate emergency, much depends on what President Biden can deliver at his Earth Day Climate Summit. So, what are Biden’s challenges and what levers might he use?
Example and persuasion are two levers. Biden has announced that the US will cut emissions by half in 2030. He has also released The American Jobs Plan investing money, with a strong environmental justice focus, into American-made EVs, infrastructure resilience, 100% carbon free electricity by 2035, affordable energy efficient housing, climate-focused research and R&D.
Will this persuade countries to follow in the Covid-led recovery?
Domestically, though, Biden needs to focus on the sobering bp Statistical Review of World Energy 2020. Remembering that 73% of global emissions come from the energy sector, in 2019 the shares of global primary energy were: oil – 33.1%; coal – 27%; gas – 24.2%; hydro - 6%; renewables – 5%; and nuclear – 4.3%, signalling 84% reliance on fossil fuels.
BP also reports that in 2019, for the third consecutive year, the US posted the largest increase in oil production of any country, with its output rising by a 1.7 million b/d, surpassed only by its record increase in 2018 of 2.2 million b/d.
Internationally, how will he respond to Australia being, in 2020, the largest exporter of coal in the world, exporting US$44.4 billion worth of coal (37.5% of total coal exports) and double that of its largest competitor – Indonesia at $21.5 billion (18.2%)?
These issues are crucial given UNEP’s Emissions Gap Report 2020 which states that although CO2 emissions reduced slightly during the COVID-19 pandemic, temperatures can rise above 3°C this century. UNEP states that the Paris Agreement targets ‘are still woefully inadequate’ and need to be ‘roughly tripled for the 2°C pathway and increased at least fivefold for the 1.5°C pathway.’
The World Meteorological Organization’s State of the Global Climate 2020 states that in 2019, CO2 is 410.5 ppm which is 148% above preindustrial levels.
Can Biden do more than the desperate efforts the United Nations Framework Convention on Climate Change (UNFCCC) Secretariat and the United Nations Champions on Climate Change in 2020-2021 to spur action on the Paris goals?
In the face of inadequate governmental action, they have fired the starting pistol on the 2020 Race to Zero, and the 2021 Race to Zero Breakthrough Sectors and Race to Resilience. Michael Bloomberg has been appointed the Global Ambassador of the Races.
The Race to Zero calls for net zero by 2050 in these sectors: supply (manufacturers and producers) and demand (retailers, service providers and distributors); finance (investors, asset managers and owners, banks and public funds); policy makers (countries, states, cities, regions); and civil society organisations.
This Coalition mobilises 509 cities, 23 regions, 2,162 businesses, 127 large investors, and 571 universities which collectively cover nearly 25% global CO2 emissions and over 50% GDP. Also, the World Economic Forum launched the 2021 Mission Possible with Climate Action Partnership where, guided by the International Energy Agency, it is targeting seven high emitting sectors (shipping; aviation, steel, trucking, chemicals, cement, and aluminium) to decarbonise their activities.
Biden has also indicated that he will call for enhanced climate financing for developing countries. How much can the US invest and how will it persuade other countries to meet their commitments? National Adaptation Plans are required under the Paris Agreement but very few have been developed.
In October 2019, the LSE Grantham Institute estimated that with a below 2° C temperature rise and US$200 billion of adaptation measure in place (my italics), losses from climate-induced disaster start at US$400 billion per annum by 2030, and with more than 5.3 degrees losses start at US$4 trillion by 2100. At the 2019 UNFCCC conference, the Green Climate Fund, the official body for funnelling funds to developing countries, reported it had only received US$10.3 billion in developed country pledges.
These funds must be shared equally between mitigation and adaptation activities. This is despite developed countries pledging as far back as 2010 to provide $100 billion each year to developing countries up to 2020, with this being extended under the Paris Agreement. So, there should already be US$1 trillion in the Fund.
In response, in 2021 the Race to Resilience was launched to facilitate building the resilience of 4 billion people by 2030, assisted by non-government involvement. Frontline communities in urban, rural and coastal areas will be helped to build resilience and adapt to climate impacts.
Another significant announcement was the Coalition for Climate Resilient Investment whereby 70 institutional investors, banks, insurance companies, rating agencies, Multilateral Development Banks and governments (with US$ 11 trillion in assets) committed to accurately price physical climate risks in their investment decision-making.
In re-engaging the US in international climate diplomacy, Biden might find that he needs to use more punitive levers. Like the EU, the US’ 2021 Trade Policy Agenda and 2020 Annual Report states that the Biden Administration will ‘act against trading partners that fail to meet their environmental obligations under existing trade agreements’ including ‘consideration of carbon border adjustments’.
Is this a stick Biden is prepared to wield?