With the US exit from the Paris Agreement, a new world order is sharply coming into focus
By: Nidhi Sharma
What do you say to a man who does not believe in documented scientific facts? Who does not believe that Arctic ice sheets are shrinking, summers are getting harsher and winters more extreme. Who sees a Chinese conspiracy in it all. Who stood in the Rose Garden of the White House on Thursday and told Civilisation to take a walk.
The world watched in horror as US President Donald Trump pulled out of a carefully negotiated Paris Agreement on climate change with immediate effect. World leaders were quick to point out the big mistake Trump was committing. But in their heart of hearts, they had known this would happen at the G-7 summit in Sicily last weekend.
But the ‘unthinkable’ has happened. So should we fret? No. The road ahead is tough. After all, we are talking about keeping the global temperature rise at less than 2°C by cutting down carbon emissions through collective efforts of 195 parties —now 194. The world looks resolute and the US pullout is unlikely to have a domino effect. In fact, it could just toughen us up.
THE NEW POLITICAL AXIS
The initial reactions have shown that we may as well be witnessing a new world order. The EU is already forging a new EU-China axis. At the forefront is German Chancellor Angela Merkel, who has emerged as the go-to person for climate protection. China and the EU have signed a new alliance to reduce global carbon emissions showing their renewed commitment to Paris Agreement.
What is worrisome is the US promise of aid. The US had pledged to cut greenhouse emissions by 26-28% by 2025 and agreed to pay $3 billion in aid for other developing countries’ efforts by 2020. With Trump’s decision, it is this $3 billion that the world could be worried about. But with the increased enthusiasm that the EU and China are committing themselves to Paris, this could really be the first test of the new political axis. The agreement being signed between EU and China clearly reaffirms funding commitments and promises to bring forward new mid-century greenhouse gas reduction targets.
THE WORLD IS NOT ENOUGH
The first reaction from within the US is encouraging. Though there was loud applause at the Rose Garden on Thursday, the states — from both ends of the US political spectrum — are shaking their heads in disdain. Trump took a step backwards at a time when cities are increasingly committing to green energy. On May 1, Atlanta became the 27th city in the US to pledge going totally green. Atlanta committed to transitioning all its buildings to clean electricity sources by 2025 and 100% renewable energy by 2035. So even if the US is not in the Paris agreement, individual cities could remain committed to renewables and drive down the emissions. How much? Depends on the disdain with which they look at Trump’s pull-out decision.
IT IS ALL ECONOMICS, STUPID
At the end of it, it all boils down to economies of scale. This is how New York Times columnist Thomas L Friedman has summed it up. On a book tour in Beijing, Friedman’s reaction to Trump’s decision was “What is more powerful than Mother Nature is Father Greed.” What Friedman was alluding to was simple: renewables make more economic sense now.
The price of solar energy systems hit an all-time low in August 2015, declining 5% for residential systems. The cost of wind power dropped significantly in 2016 with cost of turbines falling 20-40% from 2008. These cost declines have enabled some renewable technologies to be cost competitive with fossil fuel technologies.
This is a global trend. This is where China and India have stepped up their efforts in a big way. At a time when the US is playing hardball, both the Asian giants are moving away from coal-friendly policies and owning up the green initiative.
A recently published study by the Organisation for Economic Cooperation and Development (OECD) has proven just this: climate protection and sustainable economic growth can go hand-in-hand. The report estimates that $6.3 trillion of investment in infrastructure is required annually on average between 2016 and 2030 to meet development needs globally. An additional $600 billion a year over the same period will make these investments climate compatible — a relatively small increase considering the short- and long-term gains in terms of growth, productivity and well-being.
Trump’s basic argument — of job loss and unemployment and ‘Iam-batting-for-Pittsburg’ — also works the other way. Since its 2008 peak, the US coal industry has been in steady decline, with total production in all major coal regions falling by at least 15% last year. The jobs in the coal industry have declined over the years.
US Energy and Employment Report statistics show that in 2016, the US solar industry employed 374,000 people (a 25% jump over the previous year) and the wind industry employed 102,000 people (a 32% increase from 2015). In comparison the numbers of coal industry were much lower. Coal mining and support employment declined 39% from March 2009 to 2016.
If it doesn’t make economic sense, business environment is bound to steer towards the healthier green option. And the governments cannot ignore economies of scale. The world will get together to ‘Make the World Great Again’.
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