The world is still a long way off the pathway to meeting our emissions goals. But 2020 saw a number of major steps in the right direction. Laurie Stone at RMI presents a list of what has been achieved and which trends and new policy commitments are pointing us towards a much needed faster transition. They include coal’s decline, wind and solar’s growing competitiveness (even compared to gas), the promise of green hydrogen, bans on gas/petrol vehicles coming over the next decades, the targeting of methane, new commitments from China and the U.S., stimulus packages and Green Deals, low-carbon investment pledges from major banks, and a growing awareness of how climate change intersects with race, the poor and marginalised communities.
2020 will be a year to remember. Fortunately, we don’t only have to remember it for a global pandemic, wildfires, an economic recession, racial justice protests, and locust swarms. Plenty of exciting and positive things happened in the energy space throughout the year. Here we list our top eleven (in no particular order).
Coal is on its way out
US power companies announced the retirement of more than a dozen coal plants in 2020, representing 26 gigawatts of power. And in Europe, coal plant retirements outpaced the commissioning of new generation for the first time. And while other regions may not be as quick to phase out coal as Europe and the United States, global coal consumption was down in 2020 due to COVID-19.
Gas isn’t far behind
As utilities retire coal plants, they are also scrapping plans to replace that coal with gas, and instead opting for clean energy portfolios. Duke Energy and Dominion Energy also decided to cancel the Atlantic Coast Pipeline, a natural gas pipeline that was to cross under the Appalachian Trail.
China commits to carbon neutrality
China announced that it will scale up its nationally determined contribution (committed to under the Paris Agreement) by adopting more vigorous policies and measures in order to achieve peak CO2 emissions before 2030 and achieve carbon neutrality before 2060.
Green Deals: carbon-free electricity goes mainstream
There are many indictors that carbon-free electricity is not on the fringe anymore. The S&P Global Clean Energy index is up 37 percent over the past two years, the European Union’s stimulus package has 25 percent set aside for climate-friendly measures such as clean energy technologies, and President-elect Biden proposed a carbon-free power sector by 2035. This follows on GridLab and the Goldman School of Public Policy’s 2035 Report, which shows that the US power grid can affordably and reliably run on 90 percent zero-carbon power as early as 2035.
Big banks make major climate commitments
Some of the world’s largest private banks, including JPMorgan Chase, HSBC, and Morgan Stanley, are considering how to reduce the carbon intensity of entire portfolios over time. These recent pledges add to growing evidence that banks are taking a more holistic approach to the climate emergency.
Financial institutions are also getting on board with shipping decarbonisation
Signatories of the Poseidon Principles—a finance initiative to decarbonise the maritime shipping sector—now represent around $140 billion in loans to international shipping, about 30 percent of the total global ship finance portfolio. And 2020 saw the first loans linked to the principles, including Seaspan’s $200 million sustainability-linked loan.
Green Hydrogen is taking off
Green hydrogen, hydrogen produced from renewable energy-powered electrolysers, is taking off around the world. Seven world-leading companies have announced a global coalition that will accelerate the scale and production of green hydrogen 50-fold in the next six years.
Green hydrogen plants are being built in a number of nations, with US power giant NextEra one of the latest companies to join the movement. Green hydrogen could even help us decarbonise the steel industry through disruptive technology breakthroughs in the heavy industry sector.
US to re-join Paris Agreement
The results of the US federal election mean that the United States will be back in the Paris Climate Agreement and reactivate the US federal role in decarbonisation. Additionally, voters passed many state and local ballot measures that will help advance the energy transition.
Bans on gas vehicles are growing
France, Canada, the United Kingdom, and at least a dozen other countries have committed to banning gas vehicles within the next two decades. In September, California became the first US state to join in, with the goal of banning internal combustion engine vehicles by 2035.
Methane emissions are getting attention
The European Union adopted a methane strategy as part of the European Green Deal that requires improved measurement, reporting, and mitigation measures for methane emissions. Even major players in the oil and gas industry joined in the conversation, condemning the US Environmental Protection Agency’s decision to end methane emissions monitoring.
Racial justice enters the climate activism discussion
As people around the world rose up to protest systemic racial injustice, climate activists joined in, acknowledging that those most affected by climate change are poor and marginalised communities. Some of the most prominent groups working on climate change, including the Sierra Club, the Natural Resources Defense Council, 350.org, and Rocky Mountain Institute, are recognising and acting on racial and climate justice.
While there are many reasons why we are glad to see the end of 2020, let’s look on the bright side of the year, and toward an even brighter future in 2021!
Laurie Stone is a Senior Writer/Editor at Rocky Mountain Institute (RMI).
This article is published with permission. Copyright 2021, Rocky Mountain Institute