Page 39 - WEF Reoprt 2020

And lastly, and perhaps most vital, is the helpful mechanisms to bolster political
risk that the specific multilateral process confidence that climate change can be
mandated to address climate change loses successfully tackled.
momentum and action on climate stalls.
For example, the recent failure at COP25
to develop a rule book for a new global Can societies deliver?
carbon market means there is not yet a
credible system that would allow countries Climate and corresponding economic risks
to pay each other for projects that reduce threaten a 2008-style systemic collapse,
48
emissions. The risk here is not simply that unless net human-caused carbon dioxide
we lose an unaffordable five years, but (CO2) emissions fall by 50% by 2030
that the perception of failure drains more relative to 2010, and to net zero by 2050.
political support from the multilateral process Reaching these targets will require serious,
and undermines the prospects for future interconnected economic and societal
progress. However, encouraging steps transitions at macro and micro levels
are already being taken by various new that depend on technological innovation
geometries of governments, companies, and commitment from governments and
investors, sub-national entities and civil businesses. So far, however, commitments are
society working together on key areas of inadequate given the urgency of the challenge
climate action, such as the energy and and current trends are not encouraging.
industry transition, the mobilization of finance
and agriculture, and nature-based solutions. Most critically, demand for energy is
These multistakeholder efforts to advance continuing to increase and much of this
climate action, as highlighted at the 2019 UN demand is still being met by fossil fuels.
Climate Action Summit, are becoming an Global energy demand rose by 2.3% in
increasingly important component of 2018, the fastest pace in a decade. China,
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the international response. They are also the United States and India account for
nearly 70% of the rise. Energy demand is
expected to grow even further—by over
25% by 2040—driven by population growth,
increasing incomes and urbanization: in
developing economies, 1.7 billion people are
expected to move to urban areas in the next
two decades. 50

There is a clear tension between calls to green
society and the drive, particularly in emerging
markets, to boost economic growth through
investment in carbon-heavy projects such
as roads, dams, energy resources, mines
and ports. For example, coal power plants
built in Asia in the last decade accounted for
nearly one-third of the total increase in CO2
emissions in 2018. Global annual subsidies
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for fossil fuels are approximately double those
for renewable power. 52

Beyond power generation, shifts in patterns
of land use and how we manage our global
food systems are also needed to reduce
carbon emissions: agriculture, deforestation
and wetlands development contribute 23%
of all human-caused greenhouse gases.
53
Many current food and land use investment
portfolios are often not consistent with
delivering even a warming scenario.
54
Transitioning our carbon-based global
REUTERS/SEAN GARDNER

34 A Decade Left