Two important global events are coming up that are widely hoped to help address what the United Nations calls the “dual challenge” – fighting climate change and ensuring that poorer countries can develop sustainably. Energy is a central theme in both. For the first time in 40 years, the U.N. General Assembly is convening a global summit of world leaders focused solely on energy. If all goes as planned on Sept. 24, 2021, they will consider a road map that includes tripling investment in renewable power and making affordable modern and clean energy available to everyone everywhere within the decade. The second event is the U.N. climate conference in November, where negotiators representing nations around the world will be asked to ramp up their countries’ efforts to reduce their greenhouse gas emissions. This year’s climate summit will be the first to assess progress toward meeting the 2015 Paris climate agreement. There are a few new efforts – President Joe Biden announced on Sept. 17 plans for a U.S. and European Union pledge to cut methane emissions by 30% within the decade and urged other countries to join – but there are also some remaining sticking points in how nations will meet their promised targets. Resolving these will be important for the credibility of the agreement and the willingness of developing countries to commit to further progress. As climate policy experts with decades of experience in international energy policy, we have identified four strategic priorities that would help provide the foundations for success in cleaning up both energy and climate change. What has been achieved so far? Despite the ambitious goals in many countries, the world’s greenhouse gas emissions have continued to rise. The year 2020 was a brief exception – emissions fell significantly due to the global pandemic – but that trend has already reversed as economies recover. The statements released by world leaders after the recent G7 and G20 meetings underlined recognition of the problem. Still, very few countries and companies have detailed plans and budgets in place to meet their own high-level goals. Illustration showing where to cut emissions soonest most efficiently 4 strategic priorities Getting energy and climate policies worldwide headed in the same direction is a daunting task. Here are four strategies that could help countries navigate this space: 1) Deploy carbon pricing and markets more widely. Only a few countries, states and regions currently have carbon prices that are high enough to push polluters to cut their carbon dioxide emissions. The climate negotiations in Scotland will focus on getting the rules right for global markets. Making these markets function well and transparently is essential for effectively meeting the many net zero climate goals that have been announced by countries from Japan and South Korea to the U.S., China and the European Union. These include rules on the use of carbon offsets – they allow individuals or companies to invest in projects that help balance out their own emissions – which are currently highly contentious and largely not functional or transparent. 2) Focus attention on the “hard-to-decarbonize” sectors. Shipping, road freight and industries like cement and steel are all difficult places for cutting emissions, in part because they don’t yet have tested, affordable replacements for fossil fuels. While there are some innovative ideas, competitiveness concerns – such as companies moving production outside regulated areas to avoid regulations – have been a key barrier to progress. Europe is trying to overcome this barrier by establishing a carbon border adjustment mechanism, with emission levies on imports similar to those for European producers. The Biden administration is also exploring such rules. 3) Get China and other emerging economies on board. It is clear that coal, the most carbon-intensive fossil fuel, needs to be phased out fast, and doing so is critical to both the U.N.‘s energy and climate agendas. Given that more than half of global coal is consumed in China, its actions stand out, although other emerging economies such as India, Indonesia and Vietnam are also critical. This will not be easy. Notably half of the Chinese coal plants are less than a decade old, a fraction of a coal plant’s typical lifespan. 4) Focus on innovation. Support for innovation has brought us cutting-edge renewable power and electric vehicles much faster than anticipated. More is possible. For example, offshore wind, geothermal, carbon capture and green hydrogen are new developments that can make a big difference in years to come. Who leads in developing these new technologies, and which companies, will reap important economic benefits. They will also support millions of new jobs and economic growth. Luckily, investors are actively supporting these technologies. More investors are starting to believe in energy transitions and are putting their money into developing the associated technologies. Still, increased government support for research and development funding can catalyze these efforts. An opportunity also exists to broaden innovation efforts beyond technology, to a systemic approach that includes dimensions such as market design, social acceptance, equity, regulatory frameworks and business models. Energy systems are deeply interconnected to social issues, so changing them will not be successful if the solutions focus only on technology. Not one solution It is likely that U.N. energy and climate deliberations over the coming months will continue to move in fits and starts. The real work needs to take place at a more practical implementation level, such as in states, provinces and municipalities. If there is one thing we have learned, it is that mitigating climate change will be a long slog, not a one-off political announcement or celebrity endorsement. It requires much more than simply repeating platitudes. Politicians need to show that the many energy transitions emerging are good for economies and communities, and can create long-lasting jobs and tax revenues. While it’s uncontested that the benefits of greenhouse gas mitigation far exceed the cost, it is not always easy to marry this with short-term political cycles.

  South Africa’s economy has taken a number of very heavy body blows recently. These include a slowdown due to measures taken to control the spread of COVID-19, on top of increased state dysfunctionality due to corruption. The country has also just experienced the worst riots since it became a democracy in 1994. All have left it struggling financially, while investor confidence has been shaken. The country’s president, Cyril Ramaphosa, and finance minister, Tito Mboweni, have put in place measures to try to soften some of the hardships caused by the pandemic, and more recently the arson and violence. But a host of additional adjustments need to be made – to economic plans as well as budgets. One of these is the country’s power generation and electricity supply programmes. Electricity demand projections are interlinked with economic progress. Changes in the economy therefore have a direct impact on the energy sector. In addition, energy generation technologies are evolving rapidly, affecting available technological choices and associated costs. A reappraisal of the country’s long-term electricity requirements – and a review of technologies best suited under the circumstances – has therefore become a priority. Energy planning South Africa’s energy policy is managed through the Integrated Resource Plan. The document is prepared by a panel of experts and sets out the preferred evolution of the power generation landscape (additions, closures, technologies to be used) based on scenario planning. These plans are supposed to be reformulated every two years. The most recent one was gazetted in 2019. Since then there have been a number of significant developments in the sector. The first revolves around technology, in particular electricity storage, a major enabler of wind and solar as sources of electricity generation. Renewables currently make up only 10.5% of electricity generation in South Africa. But there’s widespread recognition that this needs to be increased. The push factor is that the country needs to reduce its dependency on coal. The pull factor is that it has ample supplies of both wind and sun. The cost of storage is a massive obstacle. Wind and solar can only function at specific times. The way round this is to store some of the electricity in batteries, to be released at times when the sun or wind aren’t available. At the moment building batteries large enough to see the grid through dozens of hours without wind or sun is both impractical and too expensive. But batteries with more capacity are being developed with the use of hydrogen. Better and cheaper storage will make the intermittent renewable electricity generating technologies more viable and increasingly attractive. The other reason the plan needs to be revised is that it would allow South Africa to settle the lingering confusion about possible future nuclear builds. The 2019 plan did not envisage any new nuclear developments until at least 2030. Despite this, and in the face of opposition from various quarters, the government has been encouraging the nuclear sector to engage in preparatory work leading to a new build. In my view this option should be left out of any revised plan. The main reasons are South Africa’s national fiscal shortages – nuclear is very expensive – as well as the ongoing global decline in nuclear technology. The other reason that the plan needs to be revised urgently is the changing patterns of demand. Electricity demand will grow less than projected A number of assumptions that were used to develop the integrated resource plan two years ago are no longer accurate. One has been a drop in electricity demand from the power utility Eskom. This has been driven by slower economic activity as was evident during the COVID-19 lockdowns. In addition, demand has been dampened by steep rises in electricity rates. Power cuts have also been a contributor to the drop in demand. This trend is likely to continue as the move to solar generation accelerates. Mines have been keen to set up their own on-site solar plants and there has been significant growth in solar installations on domestic rooftops and in shopping malls and factories. This will be given further wings by the fact that the government is changing the regulatory environment to make it easier for independent developers to set up power plants up to 100 megawatts. While a quicker than imagined economic recovery is always possible, this would be accommodated in future electricity plan revisions. But even here caution is required. Economic growth only leads to slightly higher electricity demand – an increase that’s always been overestimated in the past. Plugging the gaps in the interim The national power utility Eskom has been unable to provide a steady power supply due to ageing infrastructure and an abnormally high number of breakdowns. This has led to periodic electricity blackouts at times when demand has exceeded supply. To alleviate power shortages in the interim, the Ministry of Mining and Energy launched an initiative to solicit 2,000 MW of emergency power from private developers. But the plans aren’t panning out very well. Most of the capacity awarded under the programme was to a Turkish company that operates a fleet of ships with gas power stations on board. Three ships were to be moored off South Africa’s coast. But the floating power stations have run into major difficulties related to environmental authorisation requirements. There are also court challenges. The remainder of the interim plan was to be taken up by renewable energy based projects. But a new requirement in the plan for emergency power was that wind and solar plants must be able to deliver power continually from 5am until after 9pm. This means that renewable projects require supplementation when there is no sun or wind, making them expensive. The most problematic aspect of the emergency power programme is that it will award 20 year contracts to successful bidders. So a short to medium term power shortfall is to be settled by long term contracts that will supply electricity at considerably higher cost than alternative sources. The emergency