Forget the Space Race – Net Zero is the New Target
Whether your care for the environment comes from Greta Thunberg, David Attenborough’s Blue Planet, the performance of your ESG stocks or even the fact that big fossil fuel companies are starting to invest in net zero, we are all in the same boat and the impact we have on the environment around us needs to be reduced. Even if you don’t believe it, what harm can it do to move to a greener cleaner future?
Years ago, countries were racing to be the first in space, now, they are racing to become the first to meet their legally binding climate goals and declaring net zero. Doing so has benefits beyond the environment and in this article we take a look at those binding goals and where key countries are on their path to net zero.
Setting the Scene
The Intergovernmental Panel on Climate Change (IPCC) produced a report on behalf of the 2015 United Nations Climate Change Conference. The report involved more than 70 scientists from around the world and, after 3 author meetings, 3 report drafts and 42,000 reviewer comments, it was finally finished. The subject of the report looks at the estimation of global warming reaching 1.5°C and the impacts of this.
The Paris Agreement
The global consensus was to limit global warming to below 2°C, but this report set out a clear message that this needed to be reduced to 1.5°C or lower if possible. Both the report and the new target were incorporated into the Paris Agreement which was adopted by 196 nations at the COP 21 in Paris in December 2015. The agreement is a legally binding treaty on climate change, it was the first of its kind to bring all nations together under a common cause and it came into force on 4th November 2016.
The agreement runs on a five-yearly cycle with nations required to submit their National Determined Contributions (NDC) every 5 years, these can be either new or revised NDCs. These NDCs outline what these nations are doing to reduce their greenhouse gas emissions (GHG) in order to reach the goals set out in the Paris Agreement. From 2023 and every 5 years thereafter, the governments of these nations will review the implementation of the agreement and assess the collective progress towards achieving the set out targets.
The success of the Paris Agreement relies on social and economic transformation and it provides a framework for the financial and technical support to countries who need it. Many of these 196 nations are developing countries and the agreement makes clear that developed countries should consider providing assistance to countries who are less fortunate and more vulnerable.
Essentially, countries have agreed to legally binding targets to help other nations and have submitted their NDCs, but how are their activities tracked? This is where the Enhanced Transparency Framework (ETC) comes in. Starting from 2024, countries will have to report transparently on what they are doing to mitigate the impact on the climate and achieve the targets set out in the agreement.
The following covers some of the larger countries who are participating in the Paris Agreement and where they currently are; at present only two countries have achieved net zero – Suriname and Bhutan.
Countries in the Race to Net Zero
Australia
The new Australian government elected last year updated their climate targets, but there is still work to be done to be consistent with limiting global warming to 1.5°C, starting with abandoning new fossil fuel projects. There are currently no plans to phase out coal, which would be essential to reach current targets.
The Climate Action Tracker (CAT), an independent scientific project that tracks government climate action, currently rates Australian efforts for reaching their net zero target as “Poor”.
Brazil
Due to droughts a few years ago, Brazil is still struggling with hydropower shortages, leading to them using more natural gas for power supply – this means their energy plans have been set back. Their current plans will see a further increase in the use of fossil fuels, which is a delay their achieving net zero. In addition to this, deforestation has increased and is likely to continue to rise in the future, with little change in policies to enforce laws against this.
CAT currently rates Brazil as “Insufficient”. However, the Supreme Court has declared that the climate fund must be reactivated, so here’s hoping that changes are made soon.
Canada
Surprisingly, Canada is still struggling with reaching net zero – mostly due to the continual use of oil and gas and approving a large offshore project last year. Despite this, Canada’s emissions are gradually decreasing as the government implements its climate policy agenda, with further action required.
Their overall CAT rating is “Highly insufficient”, with their rating for net zero targets as “Average”.
China
On the 22nd September 2020 the leader of China, Xi Jingping, announced in a recorded video to the UN General Assembly that he would stop the rise in carbon emissions by 2030 and aim for carbon neutrality by 2060. In context, carbon neutrality means the target only applies to carbon dioxide (CO2) emissions and not other GHG emissions, rather than the EU’s goal for climate neutrality which covers all emissions. Currently, energy and electricity demand continue to grow, prolonging China’s dependence on fossil fuels, despite progress in renewables.
The Climate Action Tracker currently rates China as “Highly Insufficient”, indicating that emission levels are rising rather than falling. The CAT evaluated China’s Net Zero evaluation as “Poor”.
European Union
The EU is making progress in adopting policies to hopefully reduce emissions – if implemented correctly. Unfortunately, we’ve also seen an increase in fossil fuel investment which pushes back their decarbonisation efforts.
CAT currently rates the EU as “Insufficient”, but the rating for net zero targets is “Acceptable” – a push in the right direction.
Germany
Germany’s government is divided when it comes to action for climate change, with policy projections currently declining. However, solar power expansion has been improving – recently installing 64% more solar PV capacity than last year.
However, insufficient policies result in CAT rating Germany’s net zero target as “Average”.
India
India has made significant progress in renewable energy installation, with an extensive policy that encourages renewable energy and use of green hydrogen. However, the main factor holding India back is their reliance on coal power – a push on increased production paired with new power plants is an obstacle in reducing greenhouse gases, and the dependence on coal power during Summer heat waves further pushes back their efforts.
For this reason, CAT currently rates India as “Poor” for net zero targets.
Japan
In October 2022, Japan committed to achieve net zero by 2050. Japan is currently the world’s 5th biggest emitter. The government forecasts that 22 – 24% of electricity will come from renewable sources by 2030 and the benchmarks for this are set every 3 years by the Ministry of Economy. In recent months, Japan has adopted the Green Transformation Basic Policy that details their new decarbonisation strategy. However, this has more emphasis on economic growth than decarbonisation exercises, with no clear emissions reduction targets.
The Climate Action Tracker currently rates Japan as “Poor” overall.
Russian Federation
Russia’s invasion of Ukraine highlighted the need for a reduction of fossil fuel usage with the energy crisis effects being felt all over the world. Unsurprisingly, their efforts to tackle climate change remain low, despite being able to reach targets if better policies and practices were put into place. In 2021, Russia implemented a law to limit greenhouse gases – unfortunately a large amount of this focuses on fossil fuel extraction and exports to other countries.
CAT rates the Russian Federation with “Poor” for net zero targets.
South Africa
South Africa is making positive progress on policies to address the energy crisis by planning to decarbonise the electricity system along with new targets that set a good example to other countries. Although there are uncertainties on how this will be implemented, if done correctly they have the potential to become a blueprint for other countries.
Due to a lack of details, the CAT has not currently rated South Africa’s net zero target.
South Korea
In October 2020, South Korea committed to a net zero target by 2050, with then-president Moon Jae-in wanting to decarbonise the economy and end financing of coal. However, the new president Yoon Suk Yeol has abandoned the climate policy push and has instead revitalised the nuclear power program. South Korea’s climate change mitigation and energy planning lacks the speed required to get onto a pathway compatible with the Paris Agreement’s 1.5°C temperature limit.
Despite this, South Korea is making progress with the Framework Act on Carbon Neutrality and Green Growth, meaning CAT currently rates them as “Average” for net zero target.
Switzerland
Despite Switzerland’s perceived eco-friendliness, they are facing challenges when it comes to meeting net-zero. There have been questions on their willingness for climate action due to their lack of transparency around emissions reductions.
CAT rates them as “Insufficient”, rating their net zero targets as “Average”.
United Kingdom
Whilst the UK’s approach is aligned with cost-effective pathways, their efforts are not a fair share of the global effort to address climate change. The UK has introduced cross-cutting policies to reduce emissions, including the Net Zero Strategy, which outlines plans and commitments. However, until key policy gaps are met, the UK is not on track to meet climate targets and needs to support more impressive emissions reductions.
CAT rates the UK’s net zero targets as “Acceptable”.
United States
Last year, President Biden signed the Inflation Reduction Act, an impactful climate policy, hoping to meet its climate commitment to cut greenhouse gases emissions in half by 2030. The Climate Action Tracker estimates that this act will help to decline the USA’s greenhouse gas emissions, but still needs to implement additional policies to meet its reduction target.
They currently rate the USA as “Insufficient”, with their net zero target as “Average”.
Outlook
The Climate Action Tracker has calculated that if all governments were to adhere to their Paris-accord pledges, the planet would warm, on average, by 2.7°C by 2100 compared with pre-industrial temperatures; still a long way off the Paris target of 1.5 – 2.0°C.
