Meghan L. O’Sullivan and Jason Bordoff
The clean energy transition has reached adolescence. Its future direction is not yet set, and in the meantime, its internal paradoxes make for a volatile mix. Political leaders fret that ambitious steps to address climate change will aggravate geopolitical problems in a world already troubled by wars and humanitarian crises. Governments worried about energy security after Russia’s invasion of Ukraine have advocated for strategies that embrace both fossil fuels and clean alternatives, lest dependence on imported oil give way to reliance on imported lithium. Rising inflation and economic slowdowns, too, are exacerbating concerns that the energy transition will lead to job losses and price hikes. The warnings are coming in quick succession. In March, BlackRock CEO Larry Fink championed “energy pragmatism” in his most recent annual letter, and a few weeks later, a JPMorgan Chase report called for a “reality check” about the transition away from fossil fuels. In April, Haitham al-Ghais, the secretary-general of OPEC, wrote that the energy transition would require “realistic policies” that acknowledge rising demand for oil and gas.
The challenges facing the clean energy transition are real, but the impulse to pull back is misguided. Now is the time for more ambition, not less. As carbon emissions continue to rise, mitigating the dire threat of climate change requires much faster decarbonization than is currently underway. But this is not the only reason to hasten the transition. Poorly implemented half measures are part of the problem; they are worsening the same geopolitical tensions and economic fragmentation that make political leaders wary of stronger climate action. Well-designed and far-reaching policies, however, could help overcome this hurdle. An accelerated transition to clean energy can reinvigorate economies, curb protectionist forces, and calm great-power tensions, ameliorating the very anxieties that today are driving calls to slow down.
Forward-thinking leaders should embrace the transition away from carbon-intensive energy as a means to resolve pressing global problems rather than as just an end in itself. Focusing only on the target of net-zero emissions by midcentury, as stipulated in the Paris Agreement of 2015, would be aiming too low. The energy system is deeply entwined with geopolitics, and the effort to overhaul it is a chance to address more than just climate change.
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