Gore calls out climate backsliding amid progress on renewables
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Corporate giants and some countries are backsliding on their climate commitments — a worrying sign in a year that otherwise saw hopeful growth in renewables, Al Gore and his investment colleagues say in a new report from Generation Investment Management.
Why it matters: The sustainability trends report details lower EV production and sales in the U.S., along with hiccups in the speed of wind energy deployment in some areas.
Zoom in: Gore tells Axios that the hard work of trying to meet ambitious emissions reduction and deforestation targets has become more clear to CEOs and world leaders and led many to walk away from past promises.
- "We see that some of the ballyhooed climate promises are beginning to resemble New Year's resolutions: easy to make and hard to keep," Gore says. "And the reality is, as we note candidly, the world is not on track at present, to reach the goal of net zero emissions by 2050."
- Oil and gas companies that were leaning into the renewables side of their businesses have gone in the other direction, chasing shareholder returns.
- Meanwhile, major financial firms with sustainability targets have been fleeing groups of like-minded corporations.
- Part of this is coming from political pressure, Gore says, with a campaign against ESG investing and so-called "woke capital" stoking fears of potential legal liability for companies that stay in certain climate alliances.
Yes, but: Renewable electricity generation has made major gains in the past year, Gore says, with solar power as the big standout. The overall snapshot from the report of the energy transition is of significant momentum despite many setbacks.
- "The way we see it, there is a big wheel turning in the right direction, and some smaller wheels turning in the opposite direction," he says.
- "The big wheel is going to prevail in setting the direction of travel for the world, but the pace of the transition away from fossil fuels is what's being struggled over now."
- In particular, Gore and his colleagues call for a "new wave" of laws that would set national end dates for fossil fuel use to put teeth into otherwise empty net zero emissions promises.
Between the lines: The report itself calls out those who have not fulfilled recent climate commitments:
- "The bigger problem has been a lack of courage, fortitude and determination at a global scale as some of the leaders who made big promises at the climate summit in Glasgow in 2021 realize how difficult those promises will be to keep," it states.
The intrigue: Gore, who serves as chairman of Generation Investment Management, says there has been a deflation of the hype surrounding the deals reached in Dubai last year, including the landmark official agreement to "transition away" from fossil fuels.
- He places much of the blame for this on fossil fuel companies and their allies, as well as interest groups going after climate commitments in the financial sector and at the national, regional and local government level.
- Gore cited green hydrogen technology and battery storage additions that could be game-changers in determining the least costly and most reliable sources of power.
Zoom out: In the U.S., the Biden administration has pitched its climate programs as ways to add domestic jobs and factories.
- But the report finds the goals of shifting quickly to "clean" energy and using the transition as industrial policy — to create jobs by expanding clean tech manufacturing — are at odds due to China's "nearly insurmountable" lead in the markets for solar panels, electric cars, batteries and more.
- "How this tension gets resolved will determine how fast the energy transition can proceed," it states.
"Renewables have been winning" the competition with fossil fuels for the cheapest source of electricity generation, he says. "Now roughly $2 are being spent on the renewables side for every one on [expanding] fossil fuels. And that's genuine progress."
- "But again, we're not on track to where we need to be," Gore says.
- Gore hopes the coming year will bring progress on a demand-side signal to reduce fossil fuel use, saying, "It's been obvious for some time that we need a global price on carbon."
The bottom line: The report reads as a "yes, but" summary of this point in the energy transition, which lines up with where the U.S. and many other countries are.
- Perhaps the most important insight is found at the start, where Gore and senior partner David Blood write: "Unfortunately, the biggest problem we confront has not gone away: the sheer power of human and economic inertia."
