The Council of the European Union (EU) on 7 June 2021 adopted a regulation establishing a €17.5 billion fund, which is to contribute towards making the “Green transition” fair and inclusive. This fund comes as one of the measures adopted by the EU to achieve its goal of a 55 percent reduction in greenhouse gas (GHG) emissions by 2030 and climate neutrality by 2050.
Climate neutrality by 2050 is an objective that was endorsed in December 2019 by member states of the EU, except Poland at the time. The endorsement birth the discussion on the development of the European “Green deal”. The very essence of the commitment is to build a modern, resource-efficient and competitive economy, where there are no net emissions of greenhouse gases by 2050, where economic growth is detached from resource use and, where no person or place is left behind.
In order to be climate neutral by 2050, the EU is relying on the effort of all sectors through plans to decarbonize the energy sector. The efforts are also geared towards renovating buildings to help people cut their energy bills and energy use, support industry to innovate and to become global leaders in the Green economy, and roll out cleaner, cheaper and healthier forms of private and public transport. To do this, it will carry out a series of initiatives that will protect the environment and boost the Green economy.
The Green deal is an initiative that gives form to EU’s objective of climate neutrality by 2050. It is seen as the plan that will make the EU’s economy sustainable, where climate and environmental challenges are turned into opportunities thus making the transition just and inclusive for all. The Green deal spells out the action plan needed to improve efficiency in resource use whilst cutting on pollution and restoring biodiversity. The plan also states investments needed and the financial tools available. The EU on its part will provide financial and technical assistance to those that are most affected by the move towards the Green economy. This is what is known as the Just Transition Mechanism.
The Just Transition Mechanism (JTM) is a tool to ensure that the transition towards a climate-neutral economy happens but in a fair way, without leaving anyone behind. The Mechanism addresses the effect (economic and social) of the transition especially on regions, industries and workers who will face the greatest challenges. The support is available to all member States with focus on regions that are the most carbon-intensive or with the most people working in fossil fuels. This covers citizens that will be most vulnerable to the transition, companies that are in the carbon-intensive industries and on a national level, member States with high dependence on fossil fuel and carbon-intensive industries.
The Just Transition Fund (JTF) becomes one of the three pillars of the Just Transition Mechanism put forth as part of the European Green Deal to ensure that the transition takes place in a fair way. The other two pillars are a budget guarantee under the “InvestEU” programme and a public sector loan facility. The JTF will invest in training and retraining of workers and job seekers to help people adapt to new employment opportunities. It will also support small and medium-sized enterprises (SMEs), including start-ups, and the creation of new firms. Other forms of investment include affordable green energy and energy storage, the de-carbonization of local transport and research and innovation.
On all fronts, the EU is tackling climate change, focusing on not only transitioning but also growing its economy in the process whist protecting sectors and people who would be greatly affected by the transition. Moreover, to not slow down the momentum to climate- neutrality by 2050 because of political agendas or shift in focus, there is the proposed European Climate law that will transform promises into legal obligations. With the European Climate Law, the transition to climate neutrality will be made irreversible whilst creating a system for monitoring progress and taking further action if needed.
It is certain, that aside helping save the world, member States of the European Union have positioned themselves to be the global leaders of energy transition. They will be the formidable force in the coming energy market for having invested greatly in building expertise, promoting research and innovation and enriching their economy in the process.
A Global Concern
The fight against climate change is a global one because Climate change affects the entire globe. Unfortunately, its impacts are more pronounced in the developing world than in the developed world. Sea rise is expected to submerge a number of small, island countries, and to flood coastal spawning grounds for many staple marine resources. Heavy downpours and devastating storms will increase large-scale damage to fields, homes, businesses, transportation and power systems and industry in countries without the financial or human capital resources to respond. Heatwaves and droughts will increase pressure on already fragile power, healthcare, water and sewage systems, as well as reducing countries’ ability to feed themselves or export agricultural products.
Climate change’s impacts in the developing world will be almost exclusively negative, often terribly so. Food security, already shaky, is crumbling under rising temperatures and related climate changes.Tackling climate change by moving Africa’s global energy sector from fossil-fuel-led emissions to net zero carbon emissions among other essential paths is no longer a luxurious pursuit reserved only for the elite and developed countries but the developing countries too. If developing countries do not position themselves as contributors to the solution, the benefit of improving their economy and building influence over the energy market will elude them again.
The African continent is blessed with an abundance of all the alternative energy sources and governments need to increase climate commitments and act quickly to bring in policy and regulatory frameworks that can protect its citizens especially the poor and vulnerable just as the European countries are doing.
The “Green Recovery”
The “Green Recovery” concept is justified both environmentally and economically. As countries rebuild economies from the impacts of the pandemic, they are faced with a unique once-in-a-generation opportunity to recover better with sustainable energy.”
“Green recovery” is a widely adopted name for a proposed package of environmental, regulatory and fiscal reforms to recover prosperity after the coronavirus pandemic. The concept has received broad support from political parties, governments, activists and academia across the European Union (EU), the United Kingdom (UK), the United States (US) and other countries to ensure that investments to lift countries out of economic recession are spent in a way that combats climate change. These measures includes reduction in use of oil, coal, and gas, as well as the investment in clean transport, renewable energy, eco-friendly buildings, and sustainable corporate or financial practices. The United Nations (UN), and the Organization of Economic Co-operation and Development (OECD) support these initiatives.
A recent report by the International Renewable Energy Agency (IRENA) project that accelerating investment in renewable energy could underpin the global economy’s Covid-19 recovery by adding almost US$100 trillion to gross domestic product (GDP) by 2050. It is so because aside aiding curb in the rise in global temperatures, and providing a cost-effective power, renewables provide an opportunity for investors across the energy industry.
The diversification from fossil fuels is a global shift to ensure a cost-effective and sustainable energy supply for billions of global population. It is a panacea to the daunting electricity supply challenges that Africans have had to grapple with due to an under-developed power sector, requiring a huge expansion in its generation and grid capacity. If Africans are ever serious to provide universal and secured electricity access to its growing population, then the time to focus on resource diversification, the time to diversify to greener and least-cost fuels is now.
Which Path for Africa?
The Europeans, the Asians and the Americas have less of Green energy resources, yet they have set out the discussion on the development of a “Green deal”. They are committing to build a modern, resource-efficient and competitive economy, where there are no net emissions of greenhouse gases by 2050, where economic growth is detached from resource use and, where no person or place is left behind.
Developing regions including sub-Saharan Africa are more vulnerable to climate change, yet there seem to be no clear effort of all sectors (including transport, industry, and agriculture) through plans to decarbonize their energy sector. The European have shown the way, putting out efforts that encompasses renovating buildings to help people cut their energy bills and energy use, support industry to innovate and to become global leaders in the Green economy, and roll out cleaner, cheaper and healthier forms of private and public transport. The European Union (EU) hopes to achieve these by carrying carry out a series of initiatives that will protect the environment and boost the Green economy.
The Green deal initiative have been set out to give form to EU’s objective of climate neutrality by a set year. The plan is to make the EU’s economy sustainable, where climate and environmental challenges are turned into opportunities thus making the transition just and inclusive for all. The question remain as “which path Africa is taking?”
As African countries seek to rebuild their economies from the impacts of the pandemic, the Green recovery drive presents a unique once-in-a-generation opportunity to recover better in a more sustainable manner, with sustainable energy. As a result, there must be in place well-packaged environmental, regulatory and fiscal reforms to recover prosperity after the coronavirus pandemic. Africa must adopt the European initiative from all fronts, to tackle climate change, focusing on not only transitioning but also growing its economy in the process whist protecting sectors and people who stand to suffer greatly from the energy transition.
Written by Elizabeth Sam, Institute for Energy Security ©2021
Elizabeth is an Undergraduate from Kwame Nkrumah University of Science and Technology with a Bachelor’s of Science degree in Petroleum Engineering.