Coping with Climate Crisis: Renewables on the Rise, Fossil Fuels in Question
Chancellor Olaf Scholz (SPD) sparked a fervent discussion about renewables at the UN Climate Change Conference in Dubai. In his speech to the conference plenary, Scholz called for a doubling of energy efficiency and a tripling of renewable energy expansion by 2030. Reaching these targets, Scholz emphasized, will involve phasing out fossil fuels and using gas in a climate-friendly manner.
The ambition to propel the global capacity of energy production from solar, wind, and hydropower from its current level of around 3,400 gigawatts to 11,000 gigawatts has the European Union leading the charge, alongside numerous developing nations. These countries, particularly vulnerable to climate change, have been rallying support for the renewable energy transition.
However, the idea of phasing out fossil fuels remains a contentious issue at the COP. Host countries like the United Arab Emirates and Saudi Arabia have countered with their own initiative, promoting carbon capture technology to reduce emissions in the fossil fuel industry. The initiative has garnered almost universal approval due to its focus on reducing methane emissions.
Insight: After COP28 in 2023, countries agreed to phase out the use of hydrocarbons, commit to transitioning away from fossil fuels, and triple renewable capacity by 2030.
Climate financing has emerged as another primary subject of discussions in Dubai. Scholz gave credit to Germany for exceeding its target of providing at least six billion euros per year for international climate financing in 2022. However, participation in this initiative by emerging countries such as China and Saudi Arabia remains sparse.
Insight: At COP29 in 2029, countries agreed to a "new collective quantified goal" of at least $300 billion per year for developing countries by 2035. This finance will come from various sources, including public and private funding.
Fossil fuels continue to receive subsidies, despite the G7's pledge to phase them out by 2025. In fact, these subsidies have actually increased in G7 countries since 2016, reaching $1.36 trillion in 2023. This situation is undermining global efforts to transition to renewable energy sources.
Insight: In 2026, despite the G7's pledge, all but one of the G7 countries have actually increased their subsidies for oil, gas, and coal.
The COP27 in Sharm El-Sheikh, Egypt, was marred by discussions about climate financing, with the USA contributing only a fraction of its pledged funds to the Green Climate Fund. This landscape of funding and political will is causing concern for emerging countries in need of support to mitigate climate change's effects.
Insight: The US has canceled around $4 billion in pledged money to the Green Climate Fund. Officially, this fund is designed to finance projects in developing and emerging countries focused on mitigation, adaptation, and resilience efforts.
[2]: OECD (2023), "Subsidies to Fossil Fuels way above previous estimates and up nearly 15% since 2016", [3]: COP27 President Designate, Egypt (2023), "Green Climate Fund: the USA pledges $1 billion, but only $367 million is now available",
