Several countries across the world have accepted the Paris Agreement of 2015 to control global warming. A total of 196 countries, as per UN, have agreed to limit temperature increase to not more than 1.5 degrees Celsius every year till 2025. Further, 131 countries have also agreed to hit net zero emissions by 2050.
Net zero emission means that any extra man-made carbon emissions after 2050 will be counterbalanced by withdrawing them from the atmosphere through reduction measures.
Climate change is resulting in rising sea levels, frequent destructive cyclones/typhoons and decline in soil productivity. The permissible level of emissions, which is supposed to restrict global warming to below 2 degrees Celsius (carbon budget), is being overshot; and the possibility of missing the mid-century target of zero emissions by a wide margin is looming large.
The International Monetary Fund (IMF) and the Group of Twenty (G20) have accepted that urgent action is needed to drive transformative changes in production and consumption patterns, as per a research paper penned by Kristalina Georgieva.
The authors of the G20 background note on climate policy have submitted the policies and the quantum of investment needed in the next 5-10 years to reach the goal of net zero emissions by 2050 in a growth-friendly manner.
Their strategy mooted a three-pronged building block approach, comprising carbon pricing, green investment plan and initiatives for just transition.
Researchers Florence Jaumotte and Gregor Schwerhoff proposed that the cost of high-carbon energy should be raised to facilitate a shift towards clean green fuels and enhance energy efficiency.
Green energy investments need to be increased to finance the shift to renewables for smart electricity networks, energy efficiency measures and electrification in certain sectors (such as transportation, construction and industry), said researchers. They suggested "hump-shaped" mega investments immediately and then a gradual decline in the latter part of the decade.
An estimated additional $6-10 trillion (a cumulative 6-10 percent of annual global GDP) in global investments, both public and private, will be needed in the next decade to mitigate climate change, they said.
Public and private sources will contribute around 30 percent (including COVID-19 relief fiscal packages) and 70 percent, respectively to the additional investment, as per the International Energy Agency (IEA) data, which indicates a cumulative 2-3 percent of annual GDP for 2021-2030.
By “just transition,” the researchers meant that governments need to help struggling households (of coal miners and others) on the domestic front.
On the international front, the EU, Japan, Korea, China and the US need to provide financial support as well as technology/policy solutions to developing or emerging global economies.
Many developing economies are ready to ramp up their nationally determined contributions (NDCs) if they receive more climate finance.
(Edited by : Shoma Bhattacharjee)
