Experts participating in the seminar were Carsten Rolle, John Loughhead, Guoyi Han and Ami Sopinka. Even if the challenges vary greatly among the different countries, these experts agreed that the discussion has gone from asking “What do we need do?” to “How fast can we do it?” and “What will it cost?”
According to Lena Korkea-Aho from Nordiska Investeringsbanken, NIB, investments of USD 48 trillion (48 followed by 12 zeros), which is more than SEK 400 trillion, will be required up to 2060 to reach the Paris Agreement goal – to keep global warming under 2 degrees.
“That’s an alarmingly large amount of money,” said Lena Korkea-Aho. “But this is still only equivalent to about 0.4 percent of global accumulated GDP – which perhaps sounds a little less alarming.”
Carsten Rolle reported on a study conducted by BDI, the Germany equivalent of the Confederation of Swedish Enterprise. Germany’s climate goal is to reduce greenhouse gases between 80 and 95 percent by 2060. According to the study it is possible to achieve a reduction of 80 percent with known and available technology, but this will require ideal conditions and investments estimated at EUR 1.5 billion (around SEK 15 billion). Emissions need to be significantly reduced in all sectors.
And much more needs to be done to achieve the goal of a 95-percent reduction. In Germany the target is zero emissions from all sectors, which requires using new technology such as the CCS (Carbon Capture System). Investments are currently at around EUR 2.3 billion (around SEK 23 billion). And to succeed, global agreements are needed as well as an entirely new set of conditions.
If the current trends continue Germany will only reduce its emissions by 61 percent. But Carsten Rolle pointed to “the gap” between current development and what is required to reach the climate goal:
“A political decision is needed now to close the gap.”
In the UK the Government has prepared “The Clean Growth Strategy,” which is meant to cut emissions by 80 percent by 2050. And that’s not a “goal,” it’s a “requirement.” One key aspect of the strategy is investing in innovation. From now until 2021 the UK will invest GBP 2.5 billion in innovation, primarily in the transport and energy sectors.
“This represents the biggest transformation in peacetime for the UK,” said John Loughhead.
China, with its population of 1.4 billion people is a country that is contributing the most to global emissions. One of the main reasons is that 70 percent of electricity production comes from coal power plants. According to Guoyi Han, 2013 was seen as the “peak coal” year; in other words coal use was meant to go down after that. But now there are worrying signs that coal use is on the rise again. Guoyi Han pointed out that large areas of China still have low growth and low emissions. But as the economy in these regions improves through, for example, the new Silk Road, development will result in increased emissions.
Still, China has high climate and environmental ambitions.
“In China the issue driving the climate issue is health,” said Guoyi Han. “The fact that people are getting sick from emissions is driving new, well-defined initiatives.”
Canada is among the countries in the world with the highest carbon footprint, i.e. emissions per person. The country also has large resources in the form of oil sand and crude oil.
Canada has signed the Paris Agreement, which prescribes reducing emissions by 30 percent by 2030. Reducing emissions is a decentralised process where each region has its own plan. Today emissions vary significantly between regions and the goals also differ greatly. For example, the province of Alberta has the highest emissions but has set no goals at all.
“The regions themselves need to be driven to achieve results,” said Amy Sopinka.
In the picture, from left: Ola Alterå, moderator, Ami Sopinka, Carsten Rolle, Thomas Wrangdahl, NIB, John Loughhead and Guoyi Han.
Nordic Investment Bank
The seminar was arranged by IVA in cooperation with Nordic Investment Bank, NIB.
NIB is an international financial institution owned by Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The bank is a lender both within and outside the member nations. NIB finances projects that improve productivity and help the environment in the Nordic and Baltic countries.
Among other things, NIB provides loans for projects promoting:
- reduced pollution
- preventive measures
- resource efficiency
- development of clean technology