Author : Renita Dsouza

Expert Speak Terra Nova
Published on Apr 08, 2022
The recently released IPCC report highlights the measures that need to be undertaken to achieve climate mitigation targets and the obstacles that will surface in trying to achieve the same
The 2022 IPCC Climate Mitigation Report: Our final chance to reach 1.5 degrees

The latest instalment of the Intergovernmental Panel on Climate Change’s (IPCC) Sixth Assessment Report, titled ‘Climate Change 2022: Mitigation of Climate Change’ was released on 4 April 2022. This report paints a broad picture of the progress made in achieving climate mitigation targets and presents a comprehensive discussion on the effectiveness of and challenges confronting the climate mitigation enterprise. This article presents highlights of this discussion by teasing out the key trends in global GHG emissions and contribution of industry to these emissions, and articulating solutions for mitigating industrial emissions.<1>

Despite the growing cognisance that the window of opportunity to fight climate change is fast closing, the recent decade of 2010–2019 registered the highest Greenhouse Gas (GHG) emissions in human history, notwithstanding that the average annual growth in GHG emissions (1.3 percent) during this decade was lower than the previous one (2.1 percent, 2000-2019). This implies that the average annual growth rate would have had to decline even further to have averted this decade recording the highest GHG emissions. Even the updated Nationally Determined Contributions (NDCs)<2> are expected to fall short of what is required to bend the temperature curve to 1.5°Celsius. Although executing these updated NDCs would lead to decline in GHG emissions, the global emissions by 2030 implicated by such execution would breach pathways compatible with 1.5°Celsius by a large margin.

A remarkable increase in current 2019 emission levels compared to 1990 was demonstrated by CO2 from fossil fuel and industry rising by 15 GtCO2-eq yr-1 and by 67 percent, highest amongst all GHG gases in absolute terms and second highest in percentage terms.

What is more, the 2010–2019 decade also recorded the highest average annual emission levels for all GHG gases. A remarkable increase in current 2019 emission levels compared to 1990 was demonstrated by CO2 from fossil fuel and industry rising by 15 GtCO2-eq yr-1 and by 67 percent, highest amongst all GHG gases in absolute terms and second highest in percentage terms. At the global level, GDP per capita and population growth have been identified as the main sources of CO2 emissions resulting from fossil fuel combustion in 2010–2019.

Increase in aggregate demand following population growth and the need to increase incomes, in certain cases for achieving a decent standard of living and in others, in pursuit of untenable prosperity are driving the main culprit of climate change, CO2 emissions. Of course, not taking away from the responsibility that needs to be attributed to methane and also nitrous oxide emissions.

Households belonging to the top income decile are responsible for 36–45 percent of global GHG emissions. From the perspective of a sustainable lifestyle, the emissions generated by the consumption patterns of those belonging to the middle and the poorest income groups in emerging economies is 5–15 times lower than those belonging to the same group in the high-income countries.

This inequality in distribution of the carbon budget amongst the various income groups is glaring and unfair. If this continues, the use of the remaining carbon budget will not be aligned with achieving the Sustainable Development Goals. It is critical that a clear roadmap is articulated, one that emphasises the utilisation of this remaining carbon budget for uplifting the poor and the marginalised, minimising income, gender and other inequalities, boosting expenditure on improving health and educational outcomes, and overcoming impediments that affect the achievements of other SDGs.

The inequality in the distribution of carbon budget reinforces the need to focus upon SDG 12 of responsible consumption and production, more so, for the developed countries. The IPCC report identifies ways in which this SDG can be achieved, referred to as demand-side mitigation options. Examples of such strategies include avoiding air travel, adopting low carbon mobility options such as walking, cycling, electric mobility and public transit, shifting to plant-based diets, and increasing uptake of energy efficient end-use technologies in the context of buildings. Such demand-based strategies hold the potential of reducing GHG emissions by 40–70 percent by 2050.

The inequality in the distribution of carbon budget reinforces the need to focus upon SDG 12 of responsible consumption and production, more so, for the developed countries.

A key takeaway of the IPCC report is that while bending the temperature curve to 1.5 degrees Celsius is very difficult, it is possible. It demands immediate action which implies that nations including India will have to revisit their NDCs and net-zero targets if the globe is to peak before 2025, nearly halve the GHG emissions by 2030, and reach net-zero carbon emissions by 2050. This is going to be extremely challenging for a nation like India which requires to increase its per capita GDP and will witness population growth till 2050, both strong drivers of CO2 emissions. One facet of this challenge is in terms of the availability of climate finance and the nation’s absorptive capacity to utilise this finance effectively. Another worry associated with the required pace of transition is how compatible will such a swift transition be with being just. It is also critical that while investments are climate friendly, they have to cater to achieving the Sustainable Development Goals. Hence, the investments will have to simultaneously chase both environmental and social goals which makes fetching such finance even more difficult. India will have to address all of these concerns in a plan that holistically caters to both the Paris Agreement and the 2030 Agenda.

Not only are per capita GDP and population growth driving CO2 emissions, they are responsible for increasing emissions by 2.3 percent and 1.2 percent annually respectively. This increase is greater than the decline registered in the energy intensity of GDP which stood at -2 percent per annum and in the carbon intensity of energy which stood at -0.3 percent per annum. Efforts at resource and energy efficiencies, low carbonisation and decarbonisation are being overridden by the forces of global aggregate demand leading to resultant increase in GHG emissions. Nevertheless, these efforts appear to have reduced the average annual growth in GHG emissions from energy supply from 2.3 percent in 2000–2009 to one percent in 2010–2019. Furthermore, this growth rate has also fallen for industry from 3.4 percent in 2000-2009 to 1.4 percent in 2010-2019.

The critical question, nevertheless, is which sectors are fuelling this rise in GHG emissions. Whilst all sectors namely, energy, agriculture, forestry, and other land use, transport, industry, and buildings registered a rise in GHG emissions, the energy sector is responsible for the highest share of GHG emissions at 34 percent, followed by industry at 24 percent, then agriculture, forestry and land use at 22 percent, transport at 15 percent, and buildings at 5.6 percent. Adding indirect emissions from energy use to these percentages raises industry’s share to about 34 percent and that of buildings to about 17 percent. Furthermore, the pace of this increase occurred most rapidly for the transport (2 percent per year) and industry (1.4 percent per year) sectors.

It is worthwhile to zoom in to the industry sector which accounts for as much GHG emissions as the energy sector i.e., 34 percent (when indirect emissions are added) and is also characterised by a relatively rapid rate of increase in these emissions. Industrialisation is an inevitable outcome of rise in global aggregate demand. The need to satisfy such demand will spur industrial growth. A sharp rise in the demand for basic materials and manufactured products is responsible for industrial GHG emissions.

The investments will have to simultaneously chase both environmental and social goals which makes fetching such finance even more difficult. India will have to address all of these concerns in a plan that holistically caters to both the Paris Agreement and the 2030 Agenda.

While energy efficiency has demonstrated improvement in the context of the industrial sector, carbon intensity continues to remain a problem. Emissions from the industrial sector have been increasing since 2000 more rapidly than emissions from any other sector. The sources of industrial GHG emissions include fuel combustion, process emissions, product use and waste, and indirect emissions from electricity, and heat generation. The growth of in-use stock of manufactured capital per capita has been outpacing that of GDP per capita since 2000.

Reduction in industrial emissions can follow from the migration of primary production processes of materials such as steel, cement, plastic, pulp and paper, and chemicals to those which demand low to zero GHG energy carriers and feedstocks, and reducing the need for such primary production. Migration of primary production involves switching to processes which utilise electricity, hydrogen, biofuels, etc. Electrification through the direct use of electricity or indirectly through the use of hydrogen is becoming an important strategy for reducing GHG emissions. Decreasing the need for primary production involves reduced demand for the material itself, material efficiency, and circular economy interventions.

Certain obstacles have been identified to the abovementioned strategies of emissions reduction. Fossil fuel-based energy carriers and feedstocks are relatively less expensive than biomass or electricity-based alternatives. The report acknowledges that while technologies for enabling low to zero emissions in all industry sectors do exist, leveraging them for cost and emission reductions demands ‘5 -15 years of intensive innovation, commercialisation and policy.’ This can boost the scaling up of interventions required to reduce the emissions intensity of the primary production and reduce the need for primary production itself. This will nevertheless significantly raise production costs of basic materials like steel, cement, plastic, pulp and paper, and chemicals.

Here, the government can play an important role in encouraging R&D, providing tax concessions and production linked incentives to support production and commercialisation of these technologies and interventions, and formulate other favourable policies that will help the producers and adopters of these technologies and interventions to thrive in the market.

The report acknowledges that while technologies for enabling low to zero emissions in all industry sectors do exist, leveraging them for cost and emission reductions demands ‘5 -15 years of intensive innovation, commercialisation and policy.’

Given significant experience in engaging with interventions required for energy efficiency, the character of such interventions is well understood and adequately represented in climate change scenario modelling. However, given the plural and complex nature of interventions belonging to material efficiency, circular economy and fossil-free primary processes, and the difficulty in estimating their costs, these interventions are not adequately represented in the climate change models. This may distort projections in relation to climate mitigation costs and the need for alternative interventions. Despite this underrepresentation, scenario modelling suggests a shift of much of the focus from energy efficiency to transformational improvements in the form of material efficiency, reliance on fossil free energy carriers and feedstocks, and circular economy strategies.

To leverage these transformational changes better, it is critical to invest in and engage more with them. There is a need to direct focussed research on understanding these transformational interventions better and more appropriately estimate their costs.

In conclusion, this article summarises the argument made in the latest iteration of the IPCC report on the need to focus on industrial emissions. While the general spotlight in terms of GHG emissions has been on the energy sector, the net-zero targets necessitate that some of this spotlight be shifted to industrial emissions. The IPCC report has thrown light on the challenges involved in mitigating industrial emissions and in doing so provided the clue for the way forward. This article has built on this clue to delineate solutions to these challenges.


<1> This article is based on the technical summary of the report

<2> Announced until 11th October 2021

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Author

Renita Dsouza

Renita Dsouza

Renita DSouza is a PhD in Economics and a Fellow at Observer Research Foundation Mumbai under the Inclusive Growth and SDGs programme. Her research focus ...

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