“With the rapid technological progress of the fourth industrial revolution, we will be able to use new systems to monitor, verify and communicate the advance of global, regional and industrial actions for climate”
Energy is transforming
The key word for understanding the energy sector today is “transformation”: this isn’t only the transition towards renewable sources, but also the progress made in storage (the systems that accumulate electricity), the inroads into electrification, the decentralisation of production and the digitalisation of the distribution networks. These are all instruments that are helping to reduce greenhouse gas emissions in the atmosphere.
Various reports (such as those by New Climate Economy and Energy Transitions Commission cited by Schwab) show that this transformation not only helps the climate, but it does so at no extra cost. Indeed it is even generating economic growth and jobs.
Renewables: the first step towards transformation
The energy transition and its significance for the climate was discussed in the “Realizing the Energy Transition” session. This was moderated by Jules Kortenhorst, CEO of the Rocky Mountain Institute (USA), while our CEO Francesco Starace also spoke.
Starace emphasised the decisive role of technological innovation (with particular attention to digitalisation and materials science), thanks to which the revolution is proceeding more rapidly than can be perceived.
Starace also noted a positive tendency from an economic viewpoint: not only are clean forms of energy decarbonising the energy system (while their presence is increasing continuously, thanks to their competitive edge on the market), but they are also creating jobs that attract professionals from other sectors. Furthermore, the spread of renewables reduces the volatility of prices and enables the electrification of sectors like transport and heating, all to the advantage of the environment.
“The energy transition is blurring the previously clear boundaries between the energy sector and other industries. Today we have far more in common with the automobile industry, with the semiconductor sector through photovoltaic panels and with the chemical industry through batteries”
Starace’s optimism is shared by Christiana Figueres, Founding Partner of the organisation Global Optimism. She believes we are heading in the right direction to save the planet from climate change, even if acceleration is required in several fields (especially in order to combat deforestation): the glass is half full and we have the instruments to fill it completely. A significant example is the incredible progress made by China and India in transitioning from coal to clean forms of energy: the catalysts were, principally, the terrible health conditions in their highly polluted metropolises, but the outcomes bring advantages for everyone.
María Fernanda Suárez, Minister for Mines and Energy in Colombia, and Vicki Hollub, CEO of Occidental Petroleum Corporation, are also optimistic. They both noted that fossil fuels will continue to play an important role for many years to come: they believe, therefore, that it is necessary to reduce emissions in these sectors too, through CCS (Carbon Capture and Storage), an expensive solution which Starace believes cannot be economically sustainable.
Jeff Radebe, Energy Minister for South Africa, also joined the discussion, explaining how his country, while still dependent on coal for the generation of electricity, is heading towards renewables, having made the decisive choice for the road to transition.
The answer ti climate change is cooperation
While all observers agree on the great opportunities offered by globalisation 4.0, it is necessary to act quickly to reduce emissions in order to contain global warming within a 1.5 degree increase from preindustrial levels, as recommended by the Intergovernmental Panel on Climate Change (IPCC). But how? According to Schwab, the way forward requires an increase in international cooperation: a perspective shared by many of the participants at the Forum. At government level this means putting the Paris Agreements into practice faster, despite the withdrawal of the United States (whose government delegation was also absent from Davos).
Equally important are private public partnerships – of which WEF is one – and private collaborations, such as the Alliance of CEO Climate Leaders (which counts Francesco Starace as a member): an association of top industry managers who have managed to reduce the emissions of their businesses by 9% overall since 2015. In December, during the COP 24 at Katowice, the Alliance sent world leaders an open letter inviting them to work together: together we can stop global warming.
An appeal by post-millennials
The urgency of the need to save the planet from climate change was repeated in Davos by those who will feature in its future. A round table featuring six post-millennials was one of the most significant events of the Forum and offered a clear and moving message. A young Iraqi speaker, who had returned from the United States to her country post-war to contribute to its reconstruction, firmly declared that all investments must lead towards a clean, sustainable future. And a young Swedish political activist made an appeal to world decision-makers. Her words were simple: “Do more for the climate, or step aside.”