The EU has long prided itself on leading international efforts to control climate change. Today, the issue is nowhere near the top of the EU’s agenda, having been eclipsed by the economic downturn and the eurozone debt crisis. Unless the Europeans rediscover their commitment to clean energy, global efforts to control climate change are doomed. The EU also risks losing out on business opportunities in renewable energy and other growth sectors. With a climate-sceptic US heading into elections and most Asian countries reluctant to shoulder the costs of reducing greenhouse gas emissions, only Europe can resurrect the climate agenda.
In 2007, EU leaders endorsed the ’20-20-20′ climate and energy package, which commits EU countries to reduce greenhouse gas emissions by 20 per cent, increase energy efficiency by 20% and expand renewables to 20% of total energy, all by 2020. In addition to these ambitious targets, EU countries have taken practical but unpopular steps, such as phasing out incandescent light bulbs and requiring new and renovated buildings to be more energy efficient. The president of the European Commission, José Manuel Barroso, created a new directorate-general on climate in 2010, and the first climate action commissioner, Connie Hedegaard, has been trying hard to keep the issue on the agenda of European politicians and publics. Yet today, few European leaders, and not even Barroso, talk much about climate change.
Economic woes are the main reason why the issue has slipped down the list of EU priorities. Compared with a possible collapse of the eurozone, many Europeans (incorrectly) think of global warming as a far-away and nebulous threat. They also consider climate action as an unaffordable luxury at a time of slow growth and high unemployment. Measures that cut carbon emissions and develop sources of cleaner energy create jobs and save money in the long run, but they often require high initial investment. Cash-strapped governments and gloomy businesses have little appetite for new expenditure right now. At least climate-change sceptics remain a small minority in Europe, which implies that climate policies will get more attention again once the economy improves.
The same cannot be said of America, where climate concerns have been downgraded even more dramatically than in Europe. Campaigning for the presidency in 2008, Barack Obama promised ambitious action to cut pollution and create green jobs that, he argued, could not be outsourced. The 2009 US economic stimulus package included $70 billion for energy efficiency work, renewable energy programmes and high-speed rail. But in his September 2011 economic speech Obama did not even mention green jobs. Instead he called for extensive spending on new roads and airports and supported oil exploration in the Arctic and a new pipeline to take oil from Canadian tar sands (the extraction of which is very polluting) to refineries in Texas. The US Environmental Protection Agency, meanwhile, has postponed new rules on ground-level ozone (estimated to cause 12,000 premature deaths in America each year) until after the next presidential election.
Obama’s apparent loss of interest has both political and economic origins. In 2008, Obama could campaign on green issues without fear of losing votes to his opponent: his Republican rival, John McCain, had himself tried repeatedly to push a cap-and-trade bill through the Senate. In 2012, Obama will face either an opponent who doubts that climate change is man-made (Rick Perry, Michele Bachmann) or one who avoids saying anything about green issues (Mitt Romney). The Republican party has successfully blocked Obama’s climate initiatives. Whatever Obama says or does on climate change will be ruthlessly attacked by the Republicans.
The flagging US economy is an equally important reason for Obama’s retreat. The green jobs promised in the 2009 stimulus package have not been as plentiful as hoped. Energy efficiency programmes are labour-intensive and local, but renewable energy development has often involved importing wind turbines from China. The fact that many green jobs ended up being outsourced after all has made many voters angry. Just like most European leaders, Obama is focussing on short-term fixes to growth while investments in a sustainable future are being postponed.
The downgrading of climate policies on both sides of the Atlantic is short-sighted. If the Europeans and their international partners are to stand any chance of limiting the potentially catastrophic impacts of global warming, they have to act now. They must create the legal and political framework to bring about the trillion-euro investments needed to arrest climate change. Postponing such action, even for a few years, will make it impossible to limit global temperature increase to two degrees (the internationally agreed target) in the coming decades. Unchecked climate change is also “the biggest global health threat of the 21st century” (to quote The Lancet medical journal). Already in 2007, climate change was causing 160,000 premature deaths a year, according to the UN Inter-governmental Panel on Climate Change.
The Europeans and Americans are also damaging their mid to long-term economic prospects. The low carbon economy – including renewables, carbon capture and storage and nuclear – is today worth $3.5 trillion and is among the world’s fastest growing sectors. China already dominates the global solar energy market, and in 2010 four of the ten largest wind turbine manufacturers were Chinese. Around a million people work in the renewable energy sector in China. South Korea is planning to build the world’s largest offshore wind farm (which will be larger than the total installed capacity in the UK).
European leaders need to start investing in climate change policies again, both politically and financially. The EU should make more money available for energy efficiency and renewable energy in its future seven-year budget cycle. National leaders need to stop presenting their voters with a false choice between economic growth and green policies. With the euro in deep crisis, credible and visionary climate policies could help the EU to restore its legitimacy with European publics. Europe’s diplomats should keep making the case for a global agreement at the climate summit in South Africa in December. But a global agreement, even if reached, would not automatically deliver emissions reductions. Regulations, market mechanisms and investment will all be required, and the EU – the world’s largest market – provides an excellent forum for all these.
This article was first published in the Centre for European Reform bulletin.