Planning for a sustainable recovery and a net-zero carbon economy

By Adrien Vogt-Schilb

The ongoing wildfires and hurricane seasons in Central and North America remind us that containing the climate crisis is as urgent as ever. So while the priority is to put an end to the health crisis, a critical question is how governments can best support a sustainable recovery. We should not aim at going back to normal. The old normality gave us climate change, zoonotic diseases such as COVID-19, and the social inequalities that exacerbate vulnerability to both these calamities. The new normal should focus on sustainable development.

The science is clear that climate change impacts will continue worsening as long as global carbon emissions are not brought down to net zero. Getting to net-zero carbon emissions, or decarbonizing, means reducing carbon emissions from fossil fuels, deforestation, and industrial processes to near-zero levels; and using reforestation and restauration of other high-carbon ecosystems to balance the remaining emissions. The Paris Agreement recognizes the necessity of decarbonization, and many countries have announced that they are aiming to reach net-zero by 2050. And the potential to create millions of jobs on the way towards a net-zero carbon economy is perhaps one of the most appealing reasons to focus on a green recovery.

The good news is that experts agree that a net-zero carbon economy is technically doable and comes with economic and social opportunities. All countries can take advantage of renewable electricity, now cheaper than fossil fuel alternatives almost everywhere in the world, to decarbonize electricity generation. They can use electric cars and electric buses, electric cookstoves and other electric technologies to make the most of decarbonized electricity and reduce emissions in other sectors. In addition to being cheaper to own over their lifetime, electric vehicles may be worth promoting just based on their impact on local air pollution. Urban planning to reduce the need to use individual cars also reduces the prohibitive cost of congestion and accidents. Shifting diets towards more plant-based foods will reduce land required for grazing cattle and growing animal feeds, enabling a reversing of current deforestation trends.

The bad news is that the road towards net-zero carbon emissions is littered with obstacles. Current climate change plans, the nationally determined contributions, tend to focus on incremental changes (such as replacing coal power with natural gas) or propose abstract emission reduction targets with no concrete plan to operationalize them. In most countries, implementing them would not put the economy on tracks towards reaching net-zero emissions by 2050. Such plans will need to be updated and aligned with the decarbonization objective. Updated plans should be designed as to provide roadmaps for all sectors in the economy, making sure that actions to implement by 2025 or 2030 (such as replacing a fraction of fossil fuel power plants with renewable energy) set the basis for their economies to reach net zero emissions by 2050. Governments will face two challenges when designing such plan for a net-zero economy.

The first challenge is building coalitions that support decarbonization. While the design of a climate change plan is typically a responsibility of the ministry of environment, the line ministries (e.g. transport, energy and agriculture) and the private sector will be in the front line for implementing it, and the coordinating ministries (e.g. economics, planning) will need to give it a green light and support it. While these actors might be sympathetic to decarbonization, they will typically focus on advancing their own goals and try to solve their own set of problems. Ministries of transport and city mayors may be interested in reducing congestion and local air pollution, while farmers and ministries of agriculture may be interested in improving yields and resilience to climate change impacts. Ministries of finance of all countries will focus on containing fiscal costs. For oil majors and fossil fuel exporting countries, shifting demand and possible diversification strategies could be what keeps them up at night. Decarbonization plans can only be politically viable if they allow advancing the many objectives of their stakeholders.

A second challenge is that a plan to get to net-zero emissions by 2050 will necessarily be affected by uncertainty. Technology is uncertain. What will be the cost of batteries for electric vehicles? When will hydrogen become a viable fuel for air transport? Will plant-based meats become more affordable? Socioeconomic trends are uncertain too. Will consumers prefer more plant-based diets? Will they go back on buses after covid? What will GDP growth be for the next two decades? How much will population grow? Plans to get to net-zero should not be built on overconfident assumptions about any technology or any socioeconomic outcome.

Decision making under deep uncertainty (DMDU) toolsets can help us analyze the many implications of decarbonization. By exploring the outcomes of different policy choices, considering multiple objectives from all stakeholders, under many plausible futures, analysts can provide robust advice to governments and company executives. At the online DMDU conference on November 10th – 12th, international experts will present applications of such techniques. Join us to learn how DMDU can help plan for a sustainable recovery and a net-zero carbon economy.

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About this Blog Post:

This blog post is part of a series of posts contributed by the chairs of the 2020 DMDU Annual Meeting. For more information about the Annual Meeting, including registration, visit our website at 2020.deepuncertainty.org. We hope to (virtually) see you soon!

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