Empty U.S.-China Promises on Climate Still Mark Progress

(Bloomberg Opinion) -- One of the enduring frustrations of decades of climate diplomacy is that the two most important nations are also the least able to deliver. Some 43% of the world’s carbon emissions in 2019 came from China and the U.S. — but in contrast to regions like the European Union, U.K., South Korea and Canada, which have all passed pollution reduction targets into law, ambitions from those countries remain more hopes than promises.

Negotiators in Glasgow aren’t even attempting to come up with a legally binding agreement, largely because they’ve long acknowledged that Washington is delinquent in such matters. Treaties in the U.S. must be ratified by a malapportioned Senate, where the swing vote and key committee chairmanship is held by Joe Manchin, who represents the coal-producing state of West Virginia. The senator signaled on the eve of the climate talks that he was prepared to block President Joe Biden’s clean electricity plan.

China’s situation is in some ways even worse. For all the absolute power concentrated in the hands of President Xi Jinping, the country effectively has 32 Joe Manchins ruling each of its provinces and subdivisions. Communist Party officials see successfully running key regions as a stepping stone to influential jobs at the national level. When forced to balance the central government’s irreconcilable objectives around strong economic growth, lackluster renewables deployment and aggressive emissions control, growth always wins. The result is the sort of whiplash that’s seen coal production surge to records since an energy crunch last month. 

The joint statement between China and the U.S. announced Wednesday, vowing in mostly vague terms to collaborate in slowing warming, is nonetheless a welcome development. Talks had hitherto seemed increasingly unlikely to match up to the lofty aspirations of the U.K.’s host government. What’s encouraging is not so much the modest goals of the three-page declaration, but the fact that there’s any cooperation at all. 

Energy geopolitics has always been a brutal game. Take the 1972 negotiations between U.S., European and Japanese diplomats around setting up the oil consumers’ club that eventually became the International Energy Agency. “There appeared to be some suspicion from the Europeans that we might be using this proposal as a device to assume control over their economies,” the U.S. State Department’s energy expert James E. Akins said at one internal meeting, before adding puckishly: “This, of course, was true.”

The queasy link between traded energy and economic control is no less profound now. U.S. plans to aggressively decarbonize its economy are heavily dependent on China, which controls most of the supply chain for solar panels and lithium-ion batteries, as well as a host of essential but less prominent components and raw materials essential for renewable power. The falling prices that have driven increased U.S. solar deployment over the past decade reversed in the June quarter as the rising cost of Chinese-made polysilicon, combined with trade restrictions imposed by the Trump and Biden administrations, slowed imports.

China is, if anything, even more dependent on the U.S. It’s Washington’s naval might that guarantees the free flows of hydrocarbons around the world — something that’s vital to Beijing, since import-dependent China consumes about a third more energy than it can produce. (The U.S., by contrast, is a net energy exporter.) As with China’s control over the renewables supply chain, that fact is both a favor and a threat to its rivalrous partner. One reason Beijing has invested so heavily in building a blue-water navy that can operate globally is precisely that the current set-up leaves its energy security under the Pentagon’s control. 

Look at the text of the joint declaration issued out of Glasgow, and you’ll see much worthy pabulum and little in the way of concrete actions. Neither country has joined the conference’s commitments on coal power or electric vehicles, and China hasn’t signed up to plans to end overseas fossil fuel finance, cut emissions from methane, or make agriculture more sustainable, not to mention joined proposals on clean power, green steel, or road transport. Vague promises to take action on methane and “phase down” (but not phase out) coal usage in the late 2020s are the closest things to solid commitments.

Hopes for any breakthrough might look forlorn indeed if the best anyone can point to is a few pages of worthy but largely empty assurances. At the same time, we’re not wrong to celebrate signs of cooperation between the world’s two superpowers.

President Donald Trump’s most grievous impact on climate was likely not his ineffectual attempts to turn back the tide of energy transition in the U.S., but a trade war on China that helped nudge that country toward “dual circulation” growth, driven less by international commerce than by the sort of emissions-intensive, construction-based heavy industry that it badly needs to abandon.

Diplomacy can’t be ignored. The key emissions trajectories that the world uses to work out how bad climate change will get over the coming century are determined not by technology or economics, but by geopolitics — whether global inequality becomes better or worse, whether nationalism is weakened or resurgent, and whether conflict increases or decreases.

That fact encapsulates a profound truth. A world in which the two biggest emitters can cooperate, rather than treating climate as a zero-sum game where the rest of the planet is collateral damage, is the surest route to zero. Any sign that they’re back on that path should be welcomed.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.

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