Climate Goals Endangered By Soaring Demand for Fossil Fuels
As the global economy recovers from COVID-19, demand for oil and gas continues to surge. And oil prices are the highest they’ve been in seven years at nearly $90 a barrel. The combination of high demand and its impact on pricing makes fossil fuel investments lucrative in the short term, but Carbon Tracker analysts warn about long-term economic and climatic consequences. As demand encourages the continued investment of money into fossil fuel activities, the goal of limiting warming under 1.5 degrees C becomes increasingly unattainable.
Why This Matters
Fatih Birol, the executive director of the International Energy Agency, predicts a "looming risk of more turbulence for global energy markets" if this mismatch in demand is not corrected. In response, Birol is advocating $4 trillion in investments in clean energy by 2030 that would facilitate an orderly transition away from fossil fuels and ensure that the world reaches net-zero emissions by 2050.
Divestment from fossil fuels has become a popular strategy for reaching carbon emission goals outlined in the Paris Agreement. However, governments need to triple their current investments in clean energy to meet future needs. Increased investment will also help compensate for energy deficiencies that are contributing to the rise in energy costs, causing alarming inflation of the cost of living for citizens in the UK and other countries.
The Role Of The Build Back Better Plan
The Build Back Better plan from the Biden Administration seeks to transition the country to clean energy by targeting the two largest sources of emissions: transportation and electric power. Incentives such as electric car rebates and rooftop solar panel tax breaks are meant to encourage investments in clean energy and cut emissions in half in the next couple of decades.
Stalemates in Congress have caused the original Build Back Better plan to effectively perish. Experts like Manish Bapna, the president and chief executive of the Natural Resources Defense Council, warn against "inaction that would cripple our economy, as climate costs and dangers rise." As Congress and other global leaders argue about the nuances of climate policy, the climate crisis gets increasingly worse and the costs of more frequent disasters, damaged infrastructure, climate-induced migration, and lost labor productivity will be dramatically higher in the long term.
Reuters: 2021 saw jump in greenhouse-gas emissions, says report, January 10, 2022.
The Economist: See what three degrees of global warming looks like, October 30, 2021.