IPCC warns of high fuel price hitting net-zero targets

IN PERSPECTIVE

The United Nations Intergovernmental Panel on Climate Change (IPCC) in its latest report has warned of disastrous consequences and has concluded that carbon emissions must peak by 2025, to prevent any climate disaster. The average annual global greenhouse emissions during the decade (2010-2019) have been reported to be the highest in any decade in human history. The report added that if the world has to be saved from frequent and destructive climatic catastrophes, warming must be restricted to 1.50 degrees Celsius and the prerequisite for this is to phase out fossil fuels and reduce emissions across all sectors.

Though leading emitters of GHG like the US, China and the European countries and even India have committed to peak their emissions between 2030 and 2035, and finally achieve net-zero by 2050, 2060 and 2070 according to the pledges of different countries, the latest IPCC report says that the peak emission should come by 2025 or even earlier and should be cut by 43% by 2030. If it is not adhered to, the report warns that there will be 30 degrees Celsius warming of the planet by 2100, which would mean that the regions would face longer heat waves, forest fires and sea-level rise, melting of glaciers, droughts and cyclones.

For the first time, the latest IPCC report focuses on the role of individuals. Under the caption, “What Can Every Person Do” the report highlights the power of the individual through different actions as well as putting pressure on politicians for remedial measures. Rich investors, rich consumers and professionals like urban planners, engineers, teachers and researchers can suitably modify the process of their functions and set standards to decarbonise it. Rich investors are advised to reduce dependency on fossil fuels and sincerely attempt to transition to clean energy. Rich consumers are advised to adhere to sustainable consumption and cut carbon footprints, especially in mobility. The report suggests increasing taxes on carbon-intensive products.

Despite warnings from scientific communities and earlier IPCC reports, the global leaders are failing to take effective actions to cut emissions; the individuals are being alerted to rise to the occasion and take action to minimise carbon footprints. To accelerate the emissions cut, individuals should form groups to exert pressure on politicians to adhere to circular economy principles for sustainable development. It should be driven in such a way that achieving climate goals should be the election agenda.

There is a prospect of realignment in global energy routes owing to the disruption due to the Russian conflict in Ukraine and international sanctions imposed on Russia. The gains in cutting emissions are lost if Nord Stream is not functional. Brent crude which accounts for 50% of global oil trade has rocketed to $117 per barrel, the highest since February 2013 in six weeks of the conflict. The oil price surge will jack up inflation and raise the import bill as well as the subsidy bill. Every $1 increase per barrel in crude prices will add $2 billion to our oil import bill annually. A higher import bill widens the current account deficit, weakens the rupee and makes imports costlier. Government programmes for infrastructure, welfare and climate mitigation shrink. International crude oil prices have shot up nearly 50% above the prices when the government drew up its budget for the year 2022-23.

Developed countries, responsible for warming the planet so far, had pledged at the Copenhagen Climate Summit in 2009 to support climate action and adaptation in developing/poor countries and committed to paying $100 billion each year. Even after a decade, it has remained only a promise and no financial support has been made by any of them. With energy prices going up, most developed economies face budget deficits and high inflation and will not seriously consider climate financing for poor nations.

The fuel price hike in India is weakening our investments in the clean energy transition. A report by the economic research wing of the country’s largest lender SBI reveals that high global crude oil prices beyond $90 a barrel could lead to a revenue loss of Rs 95,000 crore to Rs 1 lakh crore in the current financial year.

The ongoing conflict in Ukraine would further delay the fulfilment of climate actions. The momentum is derailed and the climate budget is shifted towards defence. In 2020, the defence budget globally went up by 1.9% and reached $1.93 trillion. The annual global budget on defence in the current year is adequate for half of the clean energy investments required to achieve net-zero by 2050.

Around 40% of global defence spending is in the US; Germany has increased its annual defence budget to $150 million and other NATO members to $100 million. To counter the US, China has provided 7.1% of GDP for defence. India has also increased its defence budget to $70.2 billion, 10% more than the previous year’s. Global leaders will not focus on climate till the Ukraine crisis is resolved peacefully.

(The writer is former Principal Chief Conservator of Forests, Karnataka)