Emerging markets must not be ignored in rush to embrace clean energy, warns a report from Climate Advisors
In the past few weeks there has been a lot of activity from climate activists, trying to dissuade insurers from supporting fossil fuel projects across the world, including the East Africa Crude Oil Pipeline.
But now a new report cautions against rushing into clean energy projects without bringing the rest of the world, and particularly the emerging markets, along too.
The report, Risk from sustaining climate action, by Climate Advisors, focuses on the US but cautions against ignoring the rest of the world. It says: “The world is embracing clean energy. A limited set of technologies (such as wind turbines and solar panels) along with select critical minerals (eg lithium and cobalt) are vital to this transformation of the global energy and manufacturing economy.
“Securing the supply chains for these essential technologies and minerals means achieving what we term ‘clean energy security’. A growing bipartisan majority in Washington, DC, believes that clean energy security must become a national priority and both President Joe Biden and Congress have taken several important steps towards this goal within the past year alone.”
It warns: “Achieving clean energy security will not be easy. Numerous geopolitical, military, economic and social factors threaten vital clean energy supply chains, as do climatic and other natural disasters. At present, moreover, a significant portion of critical mining, mineral processing and manufacturing for the clean energy economy occurs in undemocratic nations whose lack of alignment with US interests and values compounds the risks.”
Climate Advisors notes that this report is not the first to look at these threats. Some have considered how to ensure that US companies and workers play a central role in today’s clean energy supply chains. Others have looked at how to structure these supply chains to safeguard US national defence, while others explore how to navigate the changing geopolitical landscape the clean energy transition creates.
“These perspectives are important and deserve attention but they capture only part of the picture. This report considers a neglected aspect of the clean energy supply chain problem, taking a purely environmental perspective and scrutinising the strategies needed to minimise supply chain disruptions that could undercut or hinder climate action. Adopting this perspective reveals major gaps in US policymaking to date,” the report warns.
It suggests: “By comparison, the US has done less to promote clean energy security at the global level. International cooperation in this area remains nascent. No international institutions exist for this purpose. Without a more ambitious global dimension to US clean energy security policies, the US may fail to adequately manage the risk posed by other nations not having the necessary materials and technologies to decarbonise in time to meet US and global climate goals.
“Since the US accounts for less than 14% of global greenhouse gas emissions, our clean energy security depends not only on what we do, but also on whether other nations have affordable and reliable clean energy supply chains.
To fill the foreign policy gaps in its clean energy security policies, the US should adopt a broader, more comprehensive approach – one that elevates the importance of international cooperation in managing global clean energy supply chains.”
Climate Action concludes that in the near term, the US should work with its closest allies (including Canada, Europe and Japan) to stand up new international clean energy supply chain initiatives. “These should include the creation of ‘climate alliances’ and the leveraging of traditional trade policy. Both would create resilient interdependent supply chains across this group of reliable, dependable and like-minded nations. In addition, the US should work with these allies to strengthen relevant international institutions to help manage clean supply chain issues globally,” it suggests.