Break­ing Europe’s cli­mate-change stale­mate

Financial Mirror (Cyprus) - - FRONT PAGE -

Europe has a strong tra­di­tion as a leader in the fight against cli­mate change. Lately, how­ever, the con­ti­nent has reached an ide­o­log­i­cal im­passe over how to ad­dress the prob­lem, with en­vi­ron­men­tal sus­tain­abil­ity and growth of­ten por­trayed as be­ing mu­tu­ally ex­clu­sive. If Europe is to re­main an en­vi­ron­men­tal leader, as well as a cen­ter of in­no­va­tion and com­pet­i­tive­ness, it will have to aban­don its ide­o­log­i­cal rigid­ness and em­brace re­al­is­tic, prag­matic so­lu­tions that can de­liver en­vi­ron­men­tal benefits with­out sac­ri­fic­ing eco­nomic devel­op­ment.

The chal­lenges posed by cli­mate change are real, and the con­se­quences of in­ac­tion are im­pos­si­ble to ig­nore. At the same time, there is a grow­ing de­mand for en­ergy and a des­per­ate need for a long-term exit from the on­go­ing eco­nomic cri­sis. There is no sin­gle, easy so­lu­tion that ad­dresses both of th­ese im­per­a­tives. Rein­ing in global warm­ing while en­sur­ing eco­nomic growth will re­quire a bal­anced port­fo­lio of so­lu­tions, in­clud­ing re­new­able en­ergy and in­creased en­ergy ef­fi­ciency. Es­sen­tial among such so­lu­tions is car­bon cap­ture and stor­age.

CCS tech­nol­ogy cap­tures car­bon diox­ide at the source of its emis­sion, com­presses it, and stores it per­ma­nently un­der­ground. In do­ing so, it pro­vides an im­por­tant bridge be­tween our mod­ern econ­omy, which re­lies heav­ily on car­bon­in­ten­sive fos­sil fu­els, and a fu­ture in which CO2 emis­sions are greatly re­duced. This pro­vides the means for main­tain­ing a com­pet­i­tive industrial sec­tor while si­mul­ta­ne­ously com­bat­ing global warm­ing.

To be sure, as with any in­no­va­tion, there are ques­tions about the tech­nol­ogy’s viability. Some ques­tion the scale of the in­vest­ment needed to in­stall and main­tain the sys­tems nec­es­sary for cap­tur­ing and stor­ing CO2. It is im­por­tant to note, how­ever, that th­ese costs pale in com­par­i­son with the far greater costs of re­duc­ing CO2 emis­sions with­out CCS. Ac­cord­ing to the In­ter­na­tional En­ergy Agency, for ex­am­ple, a ten-year de­lay in de­ploy­ing CCS would in­crease the cost of de­car­buris­ing the power sec­tor by EUR 750 bln ($880 bln).

The United Na­tions In­ter­gov­ern­men­tal Panel on Cli­mate Change has been un­equiv­o­cal in its in­sis­tence that re­duc­ing CO2 emis­sions and di­min­ish­ing de­pen­dence on fos­sil fu­els is more ur­gent than ever. It has made it clear that CCS, the only tech­nol­ogy that can cap­ture at least 90% of the CO2 emis­sions from the world’s largest pro­duc­ers, must be a part of the so­lu­tion.

Be­yond Europe’s bor­ders, gov­ern­ments and busi­nesses are al­ready forg­ing ahead. In Canada, the world’s first full-scale CCS project, Bound­ary Dam, came on­stream in Oc­to­ber 2014, prov­ing that the tech­nol­ogy is vi­able and ready to be de­ployed. The United Arab Emi­rates has ini­ti­ated the world’s first large- scale CCS project in the iron and steel sec­tor. China con­tin­ues to show great in­ter­est in the tech­nol­ogy, and is col­lab­o­rat­ing with the United States to de­velop its CCS ca­pa­bil­i­ties.

Europe can­not af­ford to lag be­hind. En­ergy-in­ten­sive in­dus­tries di­rectly sup­port four mil­lion jobs across the con­ti­nent. In­vest­ing in CCS would help pre­serve Europe’s eco­nomic base by se­cur­ing and cre­at­ing jobs and pro­tect­ing vi­tal in­dus­tries. It would help to re­alise a vi­sion of Europe that sup­ports both sus­tain­abil­ity and growth – a vi­sion that is clearly in line with Euro­pean Com­mis­sion Pres­i­dent Jean-Claude Juncker’s pri­or­i­ties of cre­at­ing jobs, sus­tain­ing growth, and de­vel­op­ing a com­pet­i­tive en­ergy union.

The con­ti­nent’s largest petroleum com­pa­nies, and equip­ment sup­pli­ers, are ready to in­vest what is needed to re­duce CO2 emis­sions. But, in or­der for that to be pos­si­ble, re­al­is­tic poli­cies and strate­gies are needed.

CCS has been recog­nised at the high­est po­lit­i­cal level as a part of the Euro­pean Union’s 2030 Cli­mate and En­ergy frame­work and the Euro­pean En­ergy Se­cu­rity Strat­egy. But it is time to trans­late recog­ni­tion into con­crete ac­tion. That, in turn, re­quires in­vest­ment in­cen­tives, im­proved car­bon pric­ing, and an up­grade to the emis­sions trad­ing sys­tem. A gamechang­ing so­lu­tion pre­sup­poses sub­stan­tial po­lit­i­cal will; it is es­sen­tial that Euro­pean lead­ers show that they know what needs to be done.

Sus­tain­able growth need not be an oxy­moron. But to achieve it, Europe must over­come the ide­o­log­i­cal stale­mate that is paralysing the en­vi­ron­men­tal de­bate. To rec­on­cile our en­vi­ron­men­tal pri­or­i­ties with con­tin­ued growth, we must act real­is­ti­cally, prag­mat­i­cally, and – above all – im­me­di­ately.

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