Ministers have backed Net Zero as the answer to structural political and economic challenges at home.  The energy transition is already changing international relations.  A new world, built around clean energy, will bring new dynamics, alternative questions, different power structures, and a new set of winners and losers.  With COP26 on the horizon, delivering the green economy at home offers the UK a unique opportunity to help shape the world to come. 

 

 Power Shift 

The energy transition & the transformation of politics 

In ordinary times, the sight of a Conservative Prime Minister attaching himself to a green revolution backed by a proactive, intervening government would be seismic. The prospect of The Daily Express and The Sun launching environmental campaigns on consecutive days would be hard to believe.

But this is where we are.

The Prime Minister’s Ten Point Plan, and the Energy White Paper that followed still leave big questions (the detail is critical, and much of it is yet to be defined) but their central declaration – that wind and solar power will be the mainstay of the UK’s energy mix within a decade – is historic.

That this transition aims to underpin a green recovery from COVID tasked with rekindling manufacturing and rebalancing the economy underlines the extent to which the government has identified the shift to Net Zero as the solution to structural political and economic challenges.

The focus of these announcements has been domestic, but global politics is a factor. Most of our big commitments have come since the US election. Climate change has been cited as clear common ground between Downing Street and the Biden White House.  

Timing is critical. As host of G7 Summit in June and President of COP26 in November, we find ourselves, conveniently, at the heart of the geopolitical questions that will help to shape the world to come: America after President Trump; Britain after Brexit; and a world beyond COVID.

The energy transition is already changing international relations.  

Power in the old world gathered itself around fossil fuels. Abundance offered untold wealth and influence; shortage could mean war.

A new world, built around clean energy, will bring new dynamics, different power structures, and a new set of winners and losers.

The American experience with shale offers a live case study. The US is almost energy independent. It still rests on the energy boom that came with the shale revolution and continues to rely on a traditional approach to energy.

President Biden campaigned on a promise to shake up that approach. But aligning domestic Net Zero ambition and policy with political realities is already a challenge for the new administration, Whichever road he chooses will have trade-offs and compromises.

Internationally, how has dwindling reliance on Middle Eastern oil changed America’s role and presence in the region?  How has Washington’s ability to challenge European dependence on Russian gas contributed to strains in the Atlantic Alliance?  

These are just some of the questions arising from a shale revolution in one country that effectively happened by accident. The ripple effects of an active global race to clean energy could feel more like shockwaves, and will contribute to a more fundamental shake-up of power.

We are already at the point where “an inflection is taking place,” Pascal Lamy, former Head of the World Trade Organisation, told the Financial Times. “If you compare the world today to the world 18 months ago, the big difference is that . . . only 25 per cent of the world had a decarbonisation horizon. Today, 75 per cent of the world economy has a decarbonisation horizon. This is a major shift.”

In geopolitical terms, one relationship above all is placed in the spotlight: the US-China rivalry.

President Xi’s promise of a 2060 Net Zero target might be scientifically inadequate, but it was a huge moment. Seen in the light of that commitment, China’s recent moves – from domestic industrial strategy to its influence in Africa – look increasingly like a successful effort to gain strategic advantage on clean energy.

Chinese investments control 70 per cent of the Democratic Republic of Congo’s mining portfolio, just as the clean energy transition drives demand for copper and cobalt sky high. In 2018, Chinese companies built one third of the world’s wind turbines. In 2019, China built more than 70% of the world’s Solar PV. China makes more than half the world’s electric cars, and is the world’s biggest battery producer.

As a consequence, just as scientific and popular opinion demand a clean energy transition for the wider world, the main supplier will be China.

There is a good argument that the United States retains the economic and innovative edge, but the ability to deliver long-term Net Zero goals in a way that commands public support without relying on Chinese-controlled supply chains is a huge challenge for President Biden.

Whether or not the clean energy supply chain becomes an economic flashpoint akin to the oil chokepoints of the Strait of Hormuz or Malhacca, or the Suez Canal, will come down to political choices. 

These are the shifting plates on which COP26 will take place.

The road to Glasgow offers us the first genuine window into how this will play out; against the backdrop of a summit that must deliver a significant ratcheting-up of ambition, a serious injection of cash, and meaningful progress on loss and damage. 

It is a solemn diplomatic responsibility for the UK. We need to lead, and we cannot fail.  

This puts our domestic commitments back in the spotlight, because good leadership is built on example. 

Achieving the shift to clean energy, delivering the electrification of transport, taking pollution out of heating and industry, and restoring the natural environment in ways that creates jobs and cuts bills – the central thrust of any fair energy transition and the stated aim of the government – can give focus and strategy to our economic recovery. 

Spearheading these shifts faster and fairer than other industrialised countries can also give us a foundation for international leadership and, just as the Industrial Revolution made us a powerful force in old world, offers us real influence in the shape of what comes next.

PRASEG has been contributing to policy and political debates about renewable and sustainable energy since 1979 – before either of us were born. It is the longest-standing, and remains the largest, parliamentary group active on these vital issues.  

As the energy transition gathers pace, policy delivery becomes more critical, the politics around it becomes more intense, and tackling climate change becomes the central question of our time, our commitment to make sure PRASEG plays its role in enhancing the scale and quality of debate around the energy transition – domestically and diplomatically – could not be stronger.  

Bim Afolami is the Member of Parliament for Hitchin & Harpenden and Chair of PRASEG 

Dom Goggins is Senior Adviser to PRASEG