Why ‘Carbon Neutral’ Is the New Climate Change Mantra
(Bloomberg) -- The industrialized world has been spewing carbon dioxide and other greenhouse gases faster than they can be contained for centuries. Climate change, and growing popular frustration about the inadequate response, is pushing countries to take action, or at least say they will. Becoming carbon neutral -- also known as climate-neutral or net zero -- is now a legal requirement in some countries, while European authorities are adopting legislation to become the first net zero continent. Even oil companies are getting in on the act.
1. What is carbon neutral?
It means cutting emissions to the very limit and compensating for what can’t be eliminated. Countries, for example, can spur the use of cleaner vehicles, transition their economies away from carbon-intensive heavy manufacturing and switch to greener sources of electricity such as wind and solar. Companies can adjust their practices, so a data center operator might switch to renewable power or an airline might purchase carbon offset credits.
2. What are carbon offset credits?
Developed by the United Nations and non-profit groups, these let the buyers emit a specified amount of greenhouse gas, which is offset by using the money raised to fund carbon-reduction projects such as reforestation. Carbon offsetting has risen in the past couple of years as more companies and individuals adopt the approach. There’s also an effort to harness existing markets that trade pollution permits to provide a similar mechanism.
3. Who’s trying to be carbon neutral?
What was a vague concept only several years ago is now a widely adopted goal that’s central to efforts to combat climate change. Dozens of countries have committed to go net zero, or at least outperform carbon-reduction targets set out in the landmark 2015 Paris Agreement on climate change. The U.K. and France are among a growing number of nations worldwide to have passed legislation requiring net-zero carbon emissions by 2050. China, the world’s biggest polluter, said it intends to become carbon neutral by 2060, while Japan and South Korea set their sights on 2050 to zero out emissions. The European Union proposed to completely overhaul its economy to achieve a similar 2050 goal and will pour more than 500 billion euros ($584 billion) into everything from electric cars to renewable energy and agriculture. Even oil giant BP Plc is planning to become a net-zero emissions company by 2050. Buildings, airlines and events have also made the pledge, while investments groups managing almost $5 trillion of assets have committed to having carbon-neutral portfolios by 2050.
4. What’s driving this?
Climate experts blame the vast build-up in atmospheric CO2 and other greenhouse gases since the Industrial Revolution for speeding up global warming. Without radical measures to reduce emissions, scientists warn that the fight against climate change will become unwinnable. CO2 pollution is still rising -- 2019 was another record -- and is unlikely to peak before 2040, driven by growing use of fossil fuels, says the International Energy Agency.
5. How will the goals be reached?
More urgent government action is needed to trigger changes in transport, infrastructure, land use and how cities are built. To get anywhere close to net zero by 2050, the world must invest $2.4 trillion in clean energy every year through 2035, according to the UN’s Intergovernmental Panel on Climate Change. That compares with $1.8 trillion spent in 2018 on all forms of energy systems. Coal should also be phased out almost entirely by mid-century, the panel said. Individuals are increasingly able to contribute. The market for consumer offsetting is flourishing, albeit with doubts over the effectiveness of some methods. Much will ride on technologies that on the grand scale required are as yet unproven, including carbon capture, using hydrogen as fuel and removing carbon dioxide from the atmosphere.
6. Who’s policing the rules?
Nobody really. There is some oversight built into the Paris Agreement that holds countries accountable if their climate plans aren’t ambitious enough, but nothing is enforceable by law at a global level. So far, scientists, protesters, non-governmental organizations and investors have been the main source of pressure on countries to change and make sure their promises are kept. As well as countries, a growing number of U.S. states have enshrined their commitments into legislation, making pledges harder to break.
7. Is this all just talk?
That’s the big question. Any country can make its carbon footprint appear smaller by shifting the burden, for instance winding down polluting industries at home but buying the same products from abroad. Carbon offset programs are also fallible, since there’s no mechanism to guarantee purchases are legitimate. And lawmakers can make ambitious pledges in the knowledge they’ll be out of office before any deadlines hit. Skeptics call environmental promises rolled out for the sake of good publicity “greenwashing.” Still, politicians are taking note as public opinion shifts quickly, evidenced by a global wave of protests and support for activists such as Swedish teenager Greta Thunberg. Former U.S. Vice President Joe Biden proposed a climate plan that included a carbon-free electrical grid by 2035 brought about by $2 trillion in climate-related spending over the next four years.
The Reference Shelf
- A Bloomberg editorial on why the U.K. should accept the “net zero” challenge.
- Net Zero Tracker, by the Energy & Climate Intelligence Unit.
- Bloomberg Law explored Europe’s move to carbon neutrality.
- A Bloomberg News story on how the U.K. could get to net zero.
- QuickTakes on the climate change debate, how carbon capture works and how hydrogen offers promise.
- An article looking at Spain’s carbon-neutral push.
- Through the so-called C40 initiative, cities around the world have committed to implementing their own climate action plans.
- More than 80 companies -- including Enel, Danone and L’Oreal -- signed up to the Science Based Targets initiative, pledging to hit net zero by 2050.
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