Air transport’s commitment to tackling its environmental challenges has not diminished despite the Covid-19 crisis that has decimated the global aviation industry.  On the contrary, many airlines have pledged further action by targeting net-zero emissions; by purchasing sustainable aviation fuel (SAF); retiring aged aircraft, such as the iconic Boeing 747; and investing in the latest generation of fuel-efficient planes, including the Boeing 737 MAX and Airbus A350.
The development and deployment of sustainable aviation fuel (SAF) is the biggest area of opportunity for long-term reductions in aviation emissions, according to IATA, the global body of airlines.
SAF has the capability to reduce emissions 80% on a “like-for-like” basis with Jet A-1 fuel.
Elevating the production capacity for SAF is therefore a priority for airlines. Current levels are too low, at around 0.02% of global demand, to significantly lessen emissions or to generate the economies of scale necessary to reduce costs to competitive levels. But production is beginning to increase dramatically.
In 2021, IATA estimates the production and use of between 100mn and 120mn litres of SAF — an increase of more than 50% on 2020.
SAF facilities commissioned some three to four years ago are now coming online, IATA noted. An example is the Fulcrum Sierra Biofuel plant in Reno, Nevada, in the United States, which converts solid municipal waste into SAF.
Numerous additional SAF production facilities will come online over the next four years, such that by 2025 approximately 5bn litres of SAF could be available. That, IATA says, will meet around 2% of global demand.
By 2030, projections are for SAF availability to increase to cover at least 5% of demand globally. Meeting and exceeding projections for SAF cannot be the responsibility of SAF producers and the aviation industry alone.
Governments need to set in place supportive policy frameworks, industry experts say.
The global air transport industry recently took a momentous decision to achieve net-zero carbon emissions by 2050 and ensure that flying is sustainable.
To achieve that, cost-competitive sustainable aviation fuels (SAF) should fuel the majority of aviation’s global emissions mitigation in 2050.
The industry has set out the pathway to meet its 2050 goal using a mixture of new technology, efficient operations, and improved infrastructure.
The target of reducing net CO2 by half is feasible through the aggressive deployment of SAF.
Other proposed options include the accelerated development of small, zero-emissions aircraft for short-haul operations from 2035 and the use of offsets in the interim.
These and other measures could also make it possible for the industry to meet an even more ambitious goal of net-zero carbon emissions by 2050.
It is estimated that (under the industry’s trend setting initiative CORSIA or Carbon Offsetting and Reduction Scheme for International Aviation — a global carbon offsetting scheme) aviation will have to offset 2.6bn tonnes of CO2 between 2021 and 2035.
Obviously, the aviation industry has pinned its hopes on sustainable aviation fuels, which it believes will help reduce airlines’ global emissions and industrial carbon footprint.
It is proven that SAF can cut CO2 lifecycle emissions up to 80% compared with conventional jet fuel. It uses sustainable fuel sources, which do not compete with food or water, or damage biodiversity.
Rather than being refined from petroleum, SAF is produced from sustainable resources such as waste oils from a biological origin, agri-residues, or non-fossil carbon dioxide (CO2).
Sustainable aviation fuels are currently certified by regulators for up to 50% use in commercial flights.
SAF has been around since 2008. And more than 300,000 flights have taken to the skies using SAF since 2016, according to the International Air Transport Association. More than 45 airlines now have experience with SAF.
These flights have used it blended with regular aviation — without the need for any modification of engines or aircraft — and production continues to grow.
The amount of SAF used by commercial aircraft rose 65% between 2019 and 2020, despite the devastating financial impact of Covid-19 on airlines.
IATA Director General Willie Walsh says governments must be active partners in achieving net zero by 2050. As with all other successful energy transitions, government policies have set the course and blazed a trail towards success.
“The costs and investment risks are too high otherwise. The focus must be on reducing carbon,” Walsh insists.

The teenage girls of Bhadla, near one of the world’s largest solar parks, store their books in tattered briefcases and their dreams in the essays they write between household chores.
Their remote pastoral community lost the land their animals grazed on until about a decade ago to the solar power plant in the northwestern state of Rajasthan — as well as the opportunity to work at the park due to a lack of education and skills.
Once resentful, these days Bhadla’s young women say they want to get jobs at the solar facility, reflecting emerging aspirations as India expands its renewable power capacity amid a global shift to clean energy.
“I could work in the solar park if I was educated — I could manage files in the office or do their accounts,” said Hira Bano, 18, who finished tenth grade two years ago.
“I have to study or I will be stuck in household work all my life,” said Bano, taking her books out of a briefcase gathering dust since the only village school shut more than two years ago.
Bhadla is home to one of the 52 solar parks India had approved across 14 states as of last year, in a drive to wean itself off planet-heating coal and meet a renewable energy goal of 500 gigawatts by 2030.
Sunny Rajasthan is a preferred state for building large new solar installations as it has available barren desert land that is sparsely populated, said state officials.
At 2,300 megawatts, Bhadla has the world’s largest solar farm capacity — and more parks are in the offing in Rajasthan, according to officials at the state-run Rajasthan Renewable Energy Corporation Limited (RRECL).
That is creating opportunities in a region with previously few jobs due to its extreme natural conditions and lack of water, said RRECL chairman and managing director Subodh Agarwal.
Nonetheless, Bhadla locals — pastoralists who for generations kept animals on state land they treated as their own — feel left out of the development frenzy in their backyard.
“We have lost land and livestock, so it is only education that can give us a livelihood,” said village elder Mohamed Sujawal Mehr.
“Now big companies surround us, but only a few of our men got jobs there,” he said, noting that even a security guard position requires tenth-grade schooling. “How can they hire us if we can’t read or write?”
Bhadla’s school was once an unused village accessory, as education was not seen as a priority, until the arrival of the solar park infused new life into it.
The park’s biggest operator, Saurya Urja, a joint venture of the state and infrastructure firm IL&FS, started sending two teachers to the school to hold regular classes.
One of them, Andaram Meghwal, said that when he first came to the village in 2017, the children climbed to the tops of the trees they were so afraid.
“We got students (to come in) from nearby towns to give them exposure to the world outside,” he said. “We shared stories of women achievers, the challenges they overcame.”
Bano — who had previously spent her time grazing cattle, working on the farm and fetching firewood — fell in love with science, school games and the idea of pursuing a career.
Girls were more inspired to study than boys as they had lost their main activity of grazing animals, while men could find work at the solar park, Meghwal said.
This was between 2015 and 2020, when 900,000 blue solar panels were erected on 12,000 acres, 5,500 jobs were created, and eateries and tea shops opened along a new highway.
But as the park neared completion, jobs for unqualified workers began to shrink. The plant has created about 1,100 long-term jobs to operate and maintain it over 25 years — but locals lack the technical skills needed, said Saurya Urja officials.
Sarthak Shukla, a sustainability policy consultant, said clean energy provides fewer direct jobs than thermal coal power, which employs 800 to 900 people for a 1GW plant compared with 25 to 30 at a similar-sized solar park.
In Bhadla, Ayub Khan Chooda, 35, is among those who have benefited, crediting his contract to wash 400 solar panels daily to his three tractors — which pull small water tankers along the rows — despite having studied only up to first grade.
Dadda Khatoon, 32, was also happy when her husband returned from Dubai, after six years of milking and grazing camels, and got a security guard job at the solar park for Rs8,000 ($106.30) a month.
“He is happy, healthy and we are also able to save some money,” said Khatoon, sitting with village women in the winter sun. “But I don’t seem to have a role anymore apart from cooking and feeding my family. I think I had more respect then.”
With no land left to graze their animals, Bhadla residents sold their livestock whose fodder, a bitter yellow fruit called “tumba”, now lies uneaten on the vine between the solar panels.
Women from this conservative community no longer venture out, fearing the busy highway and “the new people from cities”.
Local health workers said hypertension and diabetes have become quite common owing to the new sedentary lifestyles.
Shukla said that with a better understanding of the social and cultural impacts and the right policies, the solar sector could offer opportunities for Indian women, including training and other incentives such as health and education programmes.
Globally, women make up 32% of the renewable energy workforce compared with 22% in the oil and gas industry, according to the International Renewable Energy Agency.
Local elder Mehr loves to recall the celebrations two years ago when three girls, including Bano, passed their tenth grade, the first to do so in this village of 250 households.
“We banged plates, clapped,” he said.
But their school, which had about 100 students, shut down soon after when a disgruntled teacher submitted a report showing zero attendance — a claim disputed by villagers.
The solar firm also stopped supporting classes and shifted to a broader community focus running mobile health and veterinary clinics, according to Saurya Urja CEO Keshav Prasad.
He told the Thomson Reuters Foundation that the company backed the villagers’ demand to reopen the school, pointing to rising demand for education across villages near the solar park.
Manphool Singh, the education official overseeing Bhadla school, said he had received the requests and a government decision was pending.
“We are trying our best to open it so children can study again,” he said.
Meanwhile, the girls cook, clean and stitch together colourful pieces of cloth to make rugs for their dowries.
Drawing water from a well, Asma Khatoon, 15, said her only desire was for the school to reopen so she could sit her tenth-grade exam.
In a short Hindi essay, she wrote: “This village has too many restrictions… I want to study, become a working woman.” — Thomson Reuters Foundation

Renewable energy companies are betting that the leading contender in the race to become Japan’s next prime minister, Taro Kono, will unleash changes allowing more market access and a fairer playing field after years of neglect.
The 58-year-old has long championed more renewable supplies in Japan’s roughly $150bn electricity sector, the world’s biggest national power market outside China.
Investors have been buying renewable energy shares hoping the popular Kono wins the September 29 vote for the Liberal Democratic Party’s (LDP) next leader and — by virtue of its majority in the parliament — Japan’s next premier.
Japan’s energy mix is already undergoing change, with renewables on the rise, replacing fossil fuels which shored up power following the Fukushima nuclear disaster in 2011.
Kono, a former defence minister and scion of a political dynasty, is currently in charge of administrative reform and has clashed with the powerful industry ministry (METI), which like the steel federation, has supported a revival of the moribund nuclear sector.
“Kono has eagerly taken on deregulation over the past year, and a lot has changed. Japan’s energy shift will advance further if Kono is elected,” said Mika Ohbayashi, a director at Renewable Energy Institute founded by SoftBank Group Corp Chief Executive Masayoshi Son.
Renewable energy has also received a boost from outgoing Prime Minister Yoshihide Suga’s pledge last year to align Japan with Europe and declare a 2050 carbon neutrality target.
“The attitudes of officials at METI have drastically changed. Their attitudes toward renewable energy startups used to be rather cold, but they can’t afford to continue that stance,” said Koki Yoshino, executive officer at Japan Renewable Energy, which operates nearly 50 wind and solar power projects.
In 2018 a panel convened by Kono, who was then foreign minister, caused controversy by wading into the energy debate, normally METI’s preserve, supporting a call to get rid of nuclear power and coal while dramatically increasing renewables. Last year, Kono set up a taskforce to take down regulatory hurdles hindering Japan’s shift to renewables.
The world’s third-largest economy and fifth-biggest carbon emitter is heavily reliant on imported fossil fuels 10 years after the Fukushima catastrophe almost killed off its nuclear sector, the source of a third of Japan’s electricity before 2011.
Renewable energy is fast catching up and accounted for 22% of Japan’s energy supplies last year, meeting a recent government target a decade ahead of schedule and even contributed more than coal in one quarter.
Despite that growth, critics say METI has introduced rules that make it easy to force solar plants to shut down, known as curtailment, when supplies are abundant.
Connections for renewable projects are also being withheld at the whim of entrenched companies, Kono says on his home page where he outlines his polices.
Rules governing the use of a major transmission line that connects Japan’s main island to Hokkaido in the north need to be revised to allow more renewables into the mix, Kono says.
Electricity transmitted through the line has to be declared a day ahead of the actual transmission, making it difficult for weather-dependent renewables to use the line, which is currently underutilised, to transmit power to Tokyo, he says.
METI has increased the target for renewables to produce 36-38% of Japan’s electricity by 2030, up from 22-24%, and has set auction rules for offshore wind, one of the fast growing sectors in other parts of the world.

The ocean covers more than 70% of our planet’s surface, produces half of the oxygen we breathe, feeds billions of people, and provides hundreds of millions of jobs. It also plays a major role in mitigating climate change: over 80% of the global carbon cycle passes through the ocean. But this precious natural resource is not invincible. Despite all the benefits it affords us, the ocean today faces unprecedented man-made crises that threaten its health and its ability to sustain life on Earth.
The greatest threat to marine biodiversity is overfishing. More than one-third of global fish stocks are overfished and a further 60% are fully fished. Each year, governments around the world encourage overfishing by providing $22bn in harmful fisheries subsidies. Although these subsidies are designed to help support coastal communities, they instead prop up unsustainable and unprofitable fishing activity, depleting the very resource on which local populations’ livelihoods depend.
This problem is not new. In fact, the World Trade Organisation’s members have been trying to negotiate a deal to curb these damaging payments since 2001. World leaders reiterated their commitment to tackling the issue when they agreed in 2015 to the Sustainable Development Goals (SDGs). Under SDG 14, which aims to put a healthy ocean at the heart of the global sustainable-development agenda, leaders promised by 2020 to reach an agreement at the WTO that would reduce fisheries subsidies. But they missed the deadline, as negotiations slowed during the worst of the Covid-19 pandemic.
Research shows that if WTO members were to eliminate all harmful fisheries subsidies – the most ambitious scenario – global fish biomass could increase by 12.5% by 2050. That’s an additional 35mn metric tonnes of fish, or more than four times North America’s annual fish consumption in 2017. And this is a conservative estimate. Removing destructive subsidies really will mean more fish in the sea.
The aim is not to remove support from fishing communities, but rather to redirect it in a more meaningful and less damaging way. Even if a deal does not eliminate all harmful subsidies, it would create a global framework of accountability and transparency for subsidy programmes. That, in turn, would spur dialogue between governments, fishing communities, and other stakeholders to spur the development of redesigned policies that better support fisherfolk while protecting our global commons.
Moreover, an agreement is within reach – if the political will is there to deliver it. The most recent lapse of the negotiations resulted from differences over how to structure flexibility in subsidy regimes for developing countries, as well as how to define and enforce rules on illegal fishing and sustainable stocks. But after numerous proposals and discussions, the comprehensive draft now on the table combines measures to curb harmful subsidies with specific exceptions for developing countries.
With the start of the WTO’s 12th Ministerial Conference in Geneva just days away, now is the moment for a deal. Failure to conclude one would not only harm the ocean and the livelihoods of those who depend upon it, but also would diminish the global rules-based system and damage the pursuit of the 2030 Agenda for Sustainable Development. In contrast, ending harmful fisheries subsidies would reduce the cumulative pressures on the ocean and increase its resilience in the face of climate change.
In the wake of the UN Climate Change Conference (COP26) in Glasgow, governments must demonstrate their willingness to use every tool at their disposal to tackle the climate crisis. The stakes at the upcoming WTO Ministerial Conference have perhaps never been higher. The future of multilateral trade co-operation is at risk; but, above all, jobs, food security, and the health of our global commons are on the line.
That is why 33 former government leaders and ministers from around the world have joined forces with nearly 400 scientists in urging WTO members to “harness their political mandate to protect the health of the ocean and the well-being of society.”
Governments have given their word that they will curb destructive fisheries subsidies. Next week’s meeting in Geneva will test the credibility of that pledge.
This commentary is also signed by: Axel Addy – Minister of Commerce and Industry of Liberia (2013-18); Mercedes Araoz – Prime Minister of Peru (2017-18) and Vice-President of Peru (2016-2020); Hakim Ben Hammouda – Minister of Economy and Finance of Tunisia (2014-15); Herminio Blanco – Minister for Trade and Industry of Mexico (1994-2000); Maria Damanaki – European Commissioner for Maritime Affairs and Fisheries (2010-14); Eduardo Frei Ruiz-Tagle – President of Chile (1994-2000); Michael Froman – US Trade Representative (2013-17); Tim Groser – Minister of Trade of New Zealand (2008-2015); Enrique V Iglesias – President of the Inter-American Development Bank (1988-2005); Hilda Heine – President of the Marshall Islands (2016-2020); Ban Ki-moon – UN Secretary-General (2007-2016); Ricardo Lagos – President of Chile (2000-06); Pascal Lamy – Director-General of the WTO (2005-2013); Roberto Lavagna – Minister of Economy of Argentina (2002-05); Cecilia Malmstrom – European Commissioner for Trade (2014-19); Peter Mandelson – European Commissioner for Trade (2004-08); Sergio Marchi – Minister of International Trade of Canada (1997); Heraldo Munoz – Minister of Foreign Affairs of Chile (2014-18); Pierre Pettigrew – Minister for International Trade of Canada (1999-2003), Minister of Foreign Affairs of Canada (2004-06), Tommy Remengesau, Jr. – President of the Republic of Palau (2001-09, 2013-2021); Jose Luis Rodríguez Zapatero – Prime Minister of Spain (2004-2011); José Manuel Salazar – Minister of Foreign Trade of Costa Rica (1997-98); Susan Schwab – US Trade Representative (2006-09); Juan Somavia – Director-General of International Labour Organisation (1999-2012); Alberto Trejos – Minister of Foreign Trade of Costa Rica (2002-04); Allan Wagner – Minister of Foreign Affairs of Peru (1985-88, 2002-03, 2021); Andres Velasco – Minister of Finance of Chile (2002-06); Ernesto Zedillo Ponce de León – President of Mexico (1994-2000); and Robert Zoellick – US Trade Representative (2001-05). – Project Syndicate

• Helen Clark is a former prime minister of New Zealand (1999-2008). Arancha González is a former foreign minister of Spain (2020-21). Susana Malcorra is a former foreign minister of Argentina (2015-17). James Michel is a former president of the Republic of Seychelles (2004-2016).

 Rich nations under pressure to deliver unmet $100-billion pledge

* More ambitious climate plans hinge on international funding

* Eyes on U.S. to boost finance at U.N. gathering next week

KUALA LUMPUR/BARCELONA, Sept 16 (Thomson Reuters Foundation) – F or a storm-prone developing country like the Philippines, receiving international funding to protect its people from wild weather and adopt clean energy is not only an issue of global justice – the money is essential to deliver on its climate plan.

Without promised support, many vulnerable poorer nations – battered by the economic impacts of COVID-19 and surging climate disasters – say they simply cannot take more aggressive action to cut planet-heating emissions or adapt to a warmer world.

The Philippines, for example, has pledged to reduce its emissions 75% below business-as-usual levels by 2030.

But only about 3 percentage points of that commitment can be delivered with its own resources, its national climate plan says. The rest will require international finance to make sectors like farming, industry, transport and energy greener.

“Environmental groups say our (target) is unambitious because it’s highly conditional. What they don’t see, however, is what we submitted is what is doable for the Philippines,” said Paola Alvarez, a spokesperson at the Department of Finance.

“Our economy is not doing well because of the pandemic and we have back-to-back typhoons every now and then,” which means national resources need to be prioritised for social programmes, she told the Thomson Reuters Foundation.

As leaders prepare to attend the United Nations General Assembly in New York next week, wealthy nations are coming under ever-greater pressure to deliver on an unmet pledge, made in 2009, to channel $100 billion a year to poor countries to tackle climate change.

With budgets worldwide squeezed by the COVID-19 crisis and U.N. climate talks postponed for a year, the original 2020 deadline to meet the goal was likely missed, analysts have said.

But as November’s COP26 climate summit approaches fast, time is running out to convince developing countries – both big and small emitters – that any efforts at home to raise their climate game will be met with solid financial backing, analysts say.

Alden Meyer, a senior associate in Washington for think-tank E3G, focused on accelerating a low-carbon transition, said the $100-billion promise is well below what is actually needed by emerging economies to mount an adequate response.

But delivering on it is key to spurring them on, he added.

Right now, they can say, “the developed countries aren’t doing what they said they would do in terms of support, so why should we ramp up ambition (to cut emissions)?” Meyer said.

Government officials in India – the world’s fourth-biggest emitter of planet-heating gases – have said, for example, that any further commitment to reduce its carbon footprint will depend on funding from rich countries.

National pledges to cut emissions so far are inadequate to keep global temperature rise to “well below” 2 degrees Celsius above preindustrial times, and ideally to 1.5C, as about 195 countries committed to under the 2015 Paris Agreement.

The U.N. climate science panel warned in a report in August that global warming is dangerously close to spiralling out of control and will bring climate disruption globally for decades to come, in wealthy countries as well as poor ones.

‘BARE MINIMUM’

Some big greenhouse gas emitters, including China, Russia and India, have yet to submit more ambitious plans to the United Nations, as they committed to do by 2020 under the Paris pact.

But of the roughly 110 plans delivered by other countries ahead of an adjusted U.N. deadline in July, nearly all hinge on one key condition: money.

According to the World Resources Institute (WRI), a U.S.-based think-tank that tracks national climate pledges, “well over half” of those updated emissions goals include actions that can only happen with the support of international finance.

“This underscores why it’s so critical for developed countries to deliver on their $100-billion pledge. It’s the bare minimum,” said Taryn Fransen, a climate policy expert at WRI.

In the latest submissions, a growing number of developing nations have stepped up with emissions goals they can implement on their own, she added, including Argentina, Chile and Colombia, which have dropped requests for support entirely.

But honouring the $100-billion annual commitment – which covers the five years until 2025, when a new yet-to-be-negotiated goal is set to kick in – is key to fostering trust within the global climate talks and facilitating a faster green transition, she stressed.

The latest available figures from the Organisation for Economic Co-operation and Development show that in 2018, a little under $80 billion was delivered to vulnerable countries.

An analysis by aid charity Oxfam last year put the real figure – when counting only grants and not loans that have to be paid back – much lower, at $19 billion-$22.5 billion.

Meanwhile, the 46 least-developed countries between 2014 and 2018 received just $5.9 billion in total for adaptation, a level that would cover less than 3% of the funds they need this decade, found a July study from the International Institute for Environment and Development.

U.S. FALLS SHORT

Climate and development experts argue industrialised countries built their prosperity by burning fossil fuels, making them responsible for a large part of the losses happening in countries on the frontlines of worsening floods, droughts, storms and rising seas, many of them in the southern hemisphere.

A 2020 study in The Lancet Planetary Health journal estimated that, as of 2015, nations in the Global North were responsible for 92% of carbon emissions beyond safe levels for the planet, while the Global South accounted for just 8%.

Diann Black-Layne from the Caribbean nation of Antigua and Barbuda, which is battling sea level rise and more frequent hurricanes, said climate action for developing countries “has to be conditional, because we can’t get the money”.

Black-Layne, lead climate negotiator for the 39-member Alliance of Small Island States, questioned why wealthy governments continued to fund the fossil fuel industry while failing to meet their $100-billion-a-year pledge.

“That money is available,” she said. “There is no shortage of money to get us to the 1.5C (temperature goal).”

Ahead of the COP26 summit, which starts on Oct. 31, host nation Britain has tasked Germany and Canada with coming up with a delivery plan for the elusive $100 billion a year, but observers believe that is unlikely to land until next month.

A major question is whether U.S. President Joe Biden will unveil a bigger U.S. finance commitment at the U.N. General Assembly next week, as concerns grow that the world’s biggest economy is failing to cough up its fair share.

At an April summit he hosted, Biden said the United States would double its climate finance to about $5.7 billion a year by 2024 – but that level is still seen by many climate finance experts as far below what it owes to developing countries.

A recent analysis from the Overseas Development Institute said the United States should be stumping up more than $43 billion a year based on cumulative carbon emissions, gross national income and population size.

It called the United States the biggest offender among 23 donor states in terms of falling short of its responsibilities.

On Wednesday, the European Union pledged to boost the $25 billion per year it provides in climate funding to poorer countries by 4 billion euros ($4.7 billion) through 2027, and called on the United States to step up too.

Laurence Tubiana, CEO of the European Climate Foundation and a key broker of the Paris Agreement, said this week that “serious pledges” were now needed from Washington given that some European nations had already raised their commitments.

“The U.S. must step up solidarity,” she said, adding she understood Washington was working hard to do so. ($1 = 0.8462 euros) (Reporting by Beh Lih Yi @behlihyi and Megan Rowling; Editing by Laurie Goering. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit news.trust.org)

In the run-up to this year’s United Nations Climate Change Conference in Glasgow (COP26), a growing number of companies hopped on the sustainability bandwagon, declaring commitments to achieve carbon neutrality – net-zero carbon-dioxide emissions – by mid-century. And among the many ambitious announcements to come out of COP26 is that almost 500 financial-services firms have “agreed to align $130 trillion – some 40% of the world’s financial assets – with the climate goals set out in the Paris agreement, including limiting global warming to 1.5°C.”
But many commentators have been sceptical about such proclamations, suggesting that they amount to greenwashing. Critics point to corporations’ heavy reliance on “offsetting,” which has become an increasingly important – and controversial – issue in the broader climate debate. So great is the confusion about what is real and what is not that the Taskforce on Scaling Voluntary Carbon Markets, led by UN Special Envoy for Climate Action and Finance Mark Carney, has established a new governance committee to review corporate emissions pledges.
The sceptics are right to be concerned about the use of offsets. The world needs to get to net-zero by mid-century, and it cannot do that with offsets. Companies buy offsets precisely so that they can continue emitting greenhouse gases (GHGs) while claiming that their emissions are zero, net of the offsets. The very existence of an offset means that the purchaser’s emissions are not zero.
But not all offsets are alike. The critics focus on offsets in which one company or country pays another to reduce emissions and then claims the reduction as its own. This is the kind of offset that cannot be allowed if the world as a whole is to get to zero emissions. There is a place, however, for offsets generated by removing GHGs from the atmosphere, for example by direct air capture or forest growth. If a company emits 100 tons of CO2 and then removes the same amount, its net emissions really are zero. If all companies do this, the world as a whole will achieve net-zero emissions.
True, the recourse to forestry requires a cautionary note. Growing trees raises issues of both additionality and permanence – additionality because it is hard to be sure that the forest growth would not have occurred anyway, and permanence because there is a risk that the forest will burn, a problem that has grown more visible and severe in recent years.
Still, offsets can play a positive role. The costs of reducing GHG emissions, and the willingness and ability to pay for such reductions, vary greatly from country to country, depending on the sources of its emissions and its stage of development. Some countries may not be willing or able to pay for an expensive reduction in emissions at home but could still pay for less costly reductions abroad. When this happens, an offset market can facilitate a reduction in emissions that would not otherwise have occurred, or that would not occur without a policy that penalises CO2 emissions.
In this case, offsets may be useful at least in moving the world closer to net-zero emissions. But to reach the finish line, they will have to be phased out at some point. There ultimately is no place for offsets in a zero-emissions world.
In the meantime, policymakers and business leaders would do well to attend to a related issue that has been neglected: the failure to distinguish between so-called scope-one, scope-two, and scope-three emissions. Scope one refers to emissions that arise from a company’s own operations, whereas scope two applies to those associated with the production of electric power purchased by the company, and scope three to those arising from other parts of the supply chain, particularly from the consumption of the product.
Clearly, there is potential for massive double counting here if one adds up all the emissions across companies. If my company purchases electricity from a local utility, the associated emissions are scope two for me and scope one for the utility. If Exxon sells jet fuel to American Airlines for use in Boeing aircraft, the emissions are scope three for Exxon and Boeing, and scope one for American Airlines. These emissions are counted three times, which is anathema to any competent accounting system. Every scope-two or -three emission is someone else’s scope-one emission.
Fortunately, such confusion is avoidable. If every company has reduced its scope-one emissions to zero, aggregate corporate emissions will be zero. It therefore makes sense for every company to focus only on this factor. If scope-one emissions are brought to zero, scope-two and scope-three emissions will take care of themselves.
This should help to simplify the general policy guidance and instructions given to companies: Focus on reducing your scope-one emissions. Plan on phasing out offsets over the long run. And continue to look for opportunities to remove GHGs from the atmosphere, as these reductions can still be counted against your own scope-one emissions. — Project Syndicate

? Geoffrey Heal is Professor of Social Enterprise at Columbia Business School.

Long before the real-world effects of climate change became so abundantly obvious, the data painted a bleak picture – in painful detail – of the scale of the problem. For decades, carefully collected data on weather patterns and sea temperatures were fed into models that analysed, predicted, and explained the effects of human activities on our climate. And now that we know the alarming answer, one of the biggest questions we face in the next few decades is how data-driven approaches can be used to overcome the climate crisis.
Data and technologies like artificial intelligence (AI) are expected to play a very large role. But that will happen only if we make major changes in data management. We will need to move away from the commercial proprietary models that currently predominate in large developed economies. While the digital world might seem like a climate-friendly world (it is better to Zoom to work than to drive there), digital and Internet activity already accounts for around 3.7% of total greenhouse-gas (GHG) emissions, which is about the same as air travel. In the United States, data centres account for around 2% of total electricity use.
The figures for AI are much worse. According to one estimate, the process of training a machine-learning algorithm emits a staggering 626,000lb (284,000kg) of carbon dioxide – five times the lifetime fuel use of the average car, and 60 times more than a transatlantic flight. With the rapid growth of AI, these emissions are expected to rise sharply. And Blockchain, the technology behind Bitcoin, is perhaps the worst offender of all. On its own, Bitcoin mining (the computing process used to verify transactions) leaves a carbon footprint roughly equivalent to that of New Zealand.
Fortunately, there are also many ways that AI can be used to cut CO2 emissions, with the biggest opportunities in buildings, electricity, transport, and farming. The electricity sector, which accounts for around one-third of GHG emissions, advanced the furthest. The relatively small cohort of big companies that dominate the sector have recognised that AI is particularly useful for optimising electricity grids, which have complex inputs – including the intermittent contribution of renewables like wind power – and complex usage patterns. Similarly, one of Google DeepMind’s AI projects aims to improve the prediction of wind patterns and thus the usability of wind power, enabling “optimal hourly delivery commitments to the power grid a full day in advance.”
Using similar techniques, AI can also help to anticipate vehicle traffic flows or bring greater precision to agricultural management, such as by predicting weather patterns or pest infestations.
But Big Tech itself has been slow to engage seriously with the climate crisis. For example, Apple, under pressure to keep delivering new generations of iPhones or iPads, used to be notoriously uninterested in environmental issues, even though it – like other hardware firms – contributes heavily to the problem of e-waste. Facebook, too, was long silent on the issue, before creating an online Climate Science Information Center late last year. And until the launch of the $10bn Bezos Earth Fund in 2020, Amazon and its leadership also was missing in action. These recent developments are welcome, but what took so long?
Big Tech’s belated response reflects the deeper problem with using AI to help the world get to net-zero emissions. There is a wealth of data – the fuel that powers all AI systems – about what is happening in energy grids, buildings, and transportation systems, but it is almost all proprietary and jealously guarded within companies. To make the most of this critical resource – such as by training new generations of AI – these data sets will need to be opened up, standardised, and shared.
Work on this is already underway. The C40 Knowledge Hub offers an interactive dashboard to track global emissions; NGOs like Carbon Tracker use satellite data to map coal emissions; and the Icebreaker One project aims to help investors track the full carbon impact of their decisions. But these initiatives are still small-scale, fragmented, and limited by the data that are available.
Freeing up much more data ultimately will require an act of political will. With local or regional “data commons,” AIs could be commissioned to help whole cities or countries cut their emissions. As a widely circulated 2019 paper by David Rolnick of the University of Pennsylvania and 21 other machine-learning experts demonstrates, there is no shortage of ideas for how this technology can be brought to bear.
But that brings us to a second major challenge: Who will own or govern these data and algorithms? Right now, no one has a good, complete answer. Over the next decade, we will need to devise new and different kinds of data trusts to curate and share data in a variety of contexts.
For example, in sectors like transport and energy, public-private partnerships (for example, to gather “smart-meter” data) are probably the best approach, whereas in areas like research, purely public bodies will be more appropriate. The lack of such institutions is one reason why so many “smart-city” projects fail. Whether it is Google’s Sidewalk Labs in Toronto or Replica in Portland, they are unable to persuade the public that they are trustworthy.
We will also need new rules of the road. One option is to make data sharing a default condition for securing an operating license. Private entities that provide electricity, oversee 5G networks, use city streets (such as ride-hailing companies), or seek local planning permission would be required to provide relevant data in a suitably standardised, anonymised, and machine-readable form.
These are just a few of the structural changes that are needed to get the tech sector on the right side of the fight against climate change. The failure to mobilise the power of AI reflects both the dominance of data-harvesting business models and a deep imbalance in our public institutional structures. The European Union, for example, has major financial agencies like the European Investment Bank but no comparable institutions that specialise in orchestrating the flow of data and knowledge. We have the International Monetary Fund and the World Bank, but no equivalent World Data Fund.
This problem is not insoluble. But first, it must be acknowledged and taken seriously. Perhaps then a tiny fraction of the massive financing being channelled into green investments will be directed toward funding the basic data and knowledge plumbing that we so urgently need. – Project Syndicate

• Geoff Mulgan, a former chief executive of NESTA, is Professor of Collective Intelligence, Public Policy and Social Innovation at University College London and the author of Big Mind: How Collective Intelligence Can Change Our World.

China’s industrialization has occurred at a breathtaking pace, lifting hundreds of millions out of poverty and transforming the country into the world’s factory floor. That’s also made it the biggest emitter of carbon dioxide, the main greenhouse gas driving climate change. The most-populous nation has set itself the ambitious goal of becoming carbon-neutral by 2060, a challenging target given it hasn’t even reached its emissions peak. To get there, President Xi Jinping wants to transition away from an economy reliant on coal and other fossil fuels by switching to renewable energy and developing new technology to capture emissions.

1. What is carbon neutral?

It means cutting as much of your carbon dioxide emissions as possible and then offsetting what you can’t eliminate. For a country, this could mean switching to renewable energy such as solar power instead of coal and investing in projects that absorb carbon dioxide, such as reforestation. Carbon neutral has become a goal of companies and countries alike to address public concerns about the impact emissions have on the climate.

2. What is China’s goal?

Even though China is the world’s second-largest economy, it’s still classified as a developing nation and hasn’t reached its emissions peak. That’s forecast to come by 2030, with Xi committing to carbon neutrality by 2060, 10 years after the U.S. deadline set by President Joe Biden. If China pulls it off, it would be the fastest decline from peak emissions among major economies, speedier than Europe’s goal of 70 years and the US target of 40 years. China’s plan, which the country’s climate envoy said includes all greenhouse gases and not just carbon dioxide, would boost global efforts to limit the rise in temperatures and potentially give it greater sway in global matters.

3. What needs to be done?

China has to find replacements for the fossil fuels that have powered its economy and rapid urbanization. A key early step was taken in July when China opened the world’s largest carbon trading market, creating a framework for how emissions are priced and regulated in the country. It’s already pushing the expansion of electric vehicles and automation while investing in nuclear power, which doesn’t emit greenhouse gases. There is more spending on research into technologies such as storage batteries and using hydrogen as a fuel to complement low-emissions energy sources. The government will have develop more wind and solar power projects so that coal-fired plants play a smaller role in generating electricity. Local authorities have been told to develop regional plans to lower emissions and some have already taken measures to curb what they perceive as wasteful uses of electricity, such as Bitcoin mining.

The ruling Communist Party of China has an overarching goal of creating a “great modern socialist country” to ensure a prosperous life for its citizens. That’s a mantra that has required continuous economic growth and led to increased pollution. Breaking the link between growth and emissions will require policies that take aim at fossil fuels and encourage development of renewable energy. Monetary policy will need to be adjusted if the transition causes inflationary pressure. Beijing will also need to support vulnerable sectors and regional economies during the decarbonization process. For example, the coal industry in Shanxi contributes 20% of the province’s revenue, according to PingAn Securities chief economist Zhong Zhengsheng.

5. What will be the economic impact?

Services and high-technology will have to boost their contribution to the economy, a move that could unleash investment demand of as much as 300 trillion yuan ($46.3 trillion), according to the People’s Bank of China. The central bank has said a big chunk of the funds will come from market investors but a policy framework encouraging private investment will be important. That is in addition to cleaner air, improved road safety and prevention of potential climate damage that the World Bank said could be worth 3.5% of gross domestic product by 2030. Such benefits have to be weighed against the impact on ordinary Chinese people of an economic restructuring that phases out jobs in carbon-emitting sectors, with the coal mining and processing industry employing 3.5 million workers alone.

6. Who are the biggest losers?

China’s 2,200 electricity utilities powered by fossil fuels, a group that accounts for almost half of the carbon China spews into the atmosphere and 14% of the world’s total, are among the first to feel the impact through the country’s carbon market. Power is one of the eight industries that account for nearly 90% of its carbon emissions, a group that also includes steel, construction materials and transport, according to a report by China International Capital Corp. Eliminating their dependence on fossil fuels will require a move to cleaner sources such as wind and solar and spending on mitigation measures or carbon offsets. Regional Chinese economies that rely heavily on fossil fuel production, such as Shanxi and Inner Mongolia provinces, will also be affected.

7. Who stands to benefit?

Electric-vehicle makers are one of the high-profile beneficiaries of China’s plan thanks to government subsidies. Beijing has set a target of having new-energy vehicles account for 20% of sales by 2025 compared with 6% in 2020. Utilities that make the shift to renewable sources will also benefit, along with providers of services such as emission measurement and carbon trading, according to Nannan Kou, head of China research for BloombergNEF. Other winners could include makers of photovoltaic systems, recycling firms and producers of new materials and non-ferrous metals for electric vehicle assembly.

8. What role will the central bank play?

China’s goal of carbon neutrality is shared across China’s key institutions and is a top priority for the PBOC. The central bank removed so-called clean-coal projects from its definitions of green bonds while pledging to revamp tools so it can offer cheap funds for banks to encourage more environmentally focused loans. Regulators also plan to adjust the rules on capital adequacy and how it counts green assets. At the end of March, China’s outstanding green loans stood at 14 trillion yuan, an amount set to expand at a rapid pace.

9. Will private banks play a role?

Banks will need to change who they lend to and balance how their loans mesh with Beijing’s climate ambitions. The high capital cost of building power plants, steel mills and factories mean companies in those sectors often carry significant financing needs and any rapid change could affect their ability to manage credit risks, according to Zhou Xuedong, executive vice president at National Development Bank and a former senior PBOC official. He said a climate-change stress test for financial institutions will be necessary.

This story has been published from a wire agency feed without modifications to the text.