The recent publication of the report of the Standing Committee on Finance of the UNFCCC provides an overview of current climate financing. It shows that climate financing increased by 17% over the period 2014-2016 from 584 to 681 USD billion, of which 295 USD billion is invested in renewable energy. These figures indicate a contribution to the development of renewable energies, but they need to be compared with fossil energy figures to better assess the current investment trajectory in terms of climate.
During 2015-2016, investments in fossil fuels are estimated at 742 USD billion and fossil fuel subsidies at 373 USD billion. The financial flows are higher than that for climate as visible on the figure while considering that subsidies are still high for renewable energies in relative terms of participation in the energy mix. In addition, the total investment figure in fossil fuels is down compared to those of the last decade but remain high in view of the current challenges.
Indeed, the UN's "Emission Gap Report" published on November 27th, 2018, tells us that GHG emissions have reached a historical record of 53.5 Gt CO2 equivalent in 2017 with the vast majority being attributable to the combustion of fossil resources (coal, oil and gas). The UN Environment concludes that the reaction must be immediate, and this requires a multiplication by three in efforts to contain the rise in temperatures to 2°C and by five to limit it to 1.5°C.
The efforts mentioned are more concretely measured by a 25% to 55% reduction in GHG emissions between 2017 and 2030. The UN Environment explains that if fossil fuel subsidies were eliminated, GHG emissions could fall by nearly 10% by 2030. This would be an important step in terms of reducing emissions with regards to the targets but seems difficult to achieve in the short and medium term given the size (373 USD billion) and the level of dependence of some country economies to these subsidies.
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Félix Fouret, Carbon/Climate Analyst |
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