© China’s G20 Presidency

At the Paris Conference in late 2015, 195 states agreed that climate neutrality is to be achieved in the second half of this century. However, there is some controversy around how this pro-climate decision is to be put into practice. It is a fact that the lion’s share of global greenhouse gas emissions results from energy being generated and being used. Both the energy system’s demand and supply side will therefore have to undergo some changes.

A few days ago at their meeting in Beijing, the Energy Ministers of the G20 (short for the Group of the 20 most important industrialised countries and emerging economies) discussed ways in which this could be delivered.

20 countries account for almost 80 per cent of global energy consumption

Together, the G20 nations account for more than three quarters of global energy consumption and global greenhouse gas emissions. This of course means that whether or not the targets agreed at the Paris Conference can be achieved will very much depend on these countries’ energy policies. The status quo varies widely across the 20 countries in question. On one end of the spectrum, there are industrialised countries including the US, France and Germany, whose energy consumption is flat. On the other, there are large emerging economies like China or India which are having to invest a great deal of money to be able to meet their growing demand for energy. And then there are countries like Saudi Arabia or Russia that generate a great deal of income from exporting fossil fuels.

Despite all these differences, the Beijing meeting showed that there is a near consensus that the over-arching objective must be to make the transition towards a future carbon-free energy system and to implement this in a way that makes sense in terms of economics and the environment. This is a major challenge and won’t be easy for any state. Close cooperation within the G20 can help countries find workable solutions. These solutions must then be put in place at national level. This is to ensure that they are tailored to the particular needs of each country and brought in line with the priorities it has chosen for its energy policy.

Joining forces for a clean future

The G20 countries have agreed that they want to work together more closely when it comes to expanding renewables capacity. For instance, they want to consult with one another about efficient funding schemes and on how to integrate renewables into the grids and the overall energy system.
Furthermore, all G20 countries share an interest in improving energy efficiency which will play a crucial role in making a sustainable, low-carbon future a reality. Better energy efficiency also helps companies be more competitive and helps consumers save money. Many countries have adopted energy efficiency targets and launched programmes to achieve these. Germany’s National Action Plan on Energy Efficiency is a very good example. International cooperation is also useful when it comes to developing new efficient technologies and bringing them to market.

The G20 has made access to energy another of its focal areas. Under the Chinese presidency, the G20’s activities in this field have been rolled out to the Asia-Pacific region where approx. 500 million people are still lacking access to electricity and modern cooking and heating energy. Around half of the people who don’t have access to energy live in the Asia-Pacific region. There are various ways in which this can be addressed, ranging from financial support to establishing distributed energy systems, to help with developing the grids, or to supporting innovative business models that seek to develop the necessary infrastructure.

Investment in renewables and energy efficiency should come first

State Secretary Rainer Baake who represented Germany at the Energy Minister’s meeting was pleased with the outcomes. He used the meeting to advocate investment in renewables and better energy efficiency. Moreover, he made the implications that the Paris Agreement will have on investment in the energy sector a priority for Germany’s G20 presidency in 2017.

Mr Baake pointed out that investment in modern technology is essential: “The G20 countries ought to lead the way on establishing a new standard of investment. Given that investment cycles in the energy sector are long, the goal must be to avoid any foreseeable mistakes in the investments made. We must replace fossil fuels, that is oil, coal and gas, with investments in energy efficiency technologies and in renewables.”

Next year, the meetings of the G20 will be held in Germany.