Making Deep Decarbonization a Reality

As the United Nations’ annual climate conference in Madrid limped to a close, it has become clear that climate summits are stuck in a rut. The job of cutting global emissions is actually getting harder, and not just because the planet keeps warming. Like many of the people in the halls in Madrid, I have been working on the climate problem for 30 years. Over that diplomatic epoch, emissions have gone up.

There are lots of problems with how climate diplomacy is unfolding. Some are rooted in the unavoidable tension between negotiations that must be global in scope—so they are legitimate and account for all important voices—and the challenge of reaching agreement by consensus. But the biggest problem is the lack of new facts on the ground—practical demonstrations of what deep decarbonization looks like, what it costs, and why it is a good idea. Diplomacy on difficult topics is always easier when the facts on the ground are more convenient.

The good news is that a growing number of national governments, firms, and subnational actors are willing to lead on climate change. Almost everything serious about achieving deep cuts in greenhouse gas emissions—like developing new technologies to eliminate them in the manufacture of steel and plastics, or switching to electric aircraft that yield no emissions—is fraught with industrial uncertainty, cost, risk, and contention. Demonstrating solutions is a task ideally suited for leaders willing to spend heavily to find solutions.

The governments and industries truly willing to lead are a relatively small and well-aligned group. In diplomatic settings, they can work in small groups to coordinate their actions. Keeping these groups aligned requires breaking the big climate problem down into smaller manageable units because each industrial sector has different politics, technological potentials, and policy needs.

The combination of policies and technologies that work for steel will be different for plastics and different again for electric power. In all, we looked at 10 major sectors, with critical inputs for most of those sectors from the Energy Transitions Commission.

In Madrid, I was part of a team—including Frank Geels at the University of Manchester and Simon Sharpe at the UK’s Department for Business, Energy & Industrial Strategy—that released a new study showing what is needed in each economic sector to reduce emissions and how leaders can make a difference.

As we did our work, we were struck and disturbed by how little political and industrial effort has been mobilized to deeply decarbonize economies, despite three decades of international talks on climate change. To change that, we offered two broad recommendations.

The first is that countries need to go beyond simply putting a price on carbon or adopting bold emissions goals. What’s required is a more strategic approach to policymaking aimed at reconfiguring technologies, business models, infrastructure, and markets in each country’s greenhouse gas-emitting economic sectors to reduce emissions.

In an earlier era, this approach to changing facts on the ground was called industrial policy. In many of the western, liberal democracies—especially in the United States—that approach has fallen out of favor. Done smartly, industrial policy focused on deep decarbonization is what’s needed now.

The second is that, though formal climate diplomacy tends to be organized around countries, the real focus both for governments and industries should be on coordinating actions in economic sectors to reduce emissions. Of course, governments must be actively involved by increasing incentives for investment and economies of scale for promising technologies, and by leveling playing fields so that early adopters of new green technologies are not held back by the constraints of competitiveness.

This approach of focusing on new facts on the ground is a way to get a lot more done on deep decarbonization quickly. Success may well reveal that sectors that many people have long thought to be “hard to abate” aren’t actually so hard, as described in the Mission Possible report. For example, progress on low-cost production of zero-emission hydrogen could make it easier to decarbonize many other sectors, such as steel.

Climate summits will always have an air of despair because it is easy for nations to agree on ambitious collective goals even as, individually, governments are much more reluctant to promise robust action. Action will always fall behind ambition. the key task is to change that math—by showing that it is profitable (and easier than feared) to decarbonize.

Getting out of the climate diplomacy rut requires finding ways to capitalize on the willingness of leaders to invest in solutions. As those efforts bear fruit, we will need to cross the next frontier, which is to help those good ideas that emerge from the leaders become deployed widely by followers. The more successful the leaders the easier it will be for followers to follow quickly. In the extreme, we might be able to replicate the experience with the Montreal Protocol in which more benign substitutes proved less costly (or minimally costly) compared with ozone-depleting substances. Whether decarbonization will prove that easy is, in most sectors, unknown today. But aiming for that outcome is a worthy goal—and one that will make the work of diplomacy a lot easier.