1st May 2024
Energy and climate ministers gathered in Turin, Italy, from April 29th to 30th, with one of the main outcomes being the commitment to end the use of “unabated” coal in power generation by 2035.
The agreement represents another step toward the goal set forth during last year’s COP28 United Nations climate summit to decrease reliance on fossil fuels, with coal being identified as the most environmentally harmful among them. The commitment also builds upon the previous year’s G7 agreement aimed at gradually eliminating fossil fuels. However, the final communiqué solely focuses on coal and does not mention oil and gas. It also does not address the phasing out of coal in steel production or any reduction in natural gas-fired generation.
Phasing coal by 2035
The text follows the US Environmental Protection Agency’s (EPA) recent finalisation of a rule requiring all coal plants intending to operate beyond 2039 to reduce their climate-heating emissions by 90% by that year.
The communiqué published yesterday (30 April), references “unbated coal”, implying that countries could persist in burning coal if they capture carbon emissions at their source. It also contains a provision stating that countries may adopt “a timeline consistent with maintaining a limit of 1.5°C temperature rise achievable within their net-zero pathways.” Germany has already announced its intention to close its coal plants by 2038, a plan that the agreement permits it to proceed with. In contrast, this agreement is crucial for Japan, which has not established a similar timeline yet. Therefore, the focus will now be on ensuring domestic implementation and delivery to achieve a coal phase-out by 2030.
Within the UK context, on a more positive note, this decision reaffirms the UK government’s dedication to ambitious net-zero objectives and bolsters its role as a leader in climate initiatives. As coal nears complete removal from the UK’s energy portfolio—except for Nottingham’s Ratcliffe-on-Soar coal plant, slated to operate until September 2024—this move stimulates further investment in renewable technologies and enhances confidence in the sector’s growth and viability.
Boosting capacity of renewables and energy efficiency
The communiqué states that G7 countries commit to increasing the global capacity of renewable energy sources threefold, thus fortifying energy security through initiatives like demand response, grid reinforcement, and smart grid deployment. This effort also aligns with a broader objective of contributing to a global target for energy storage in the power sector, aiming for a substantial increase to 1500 GW by 2030, building upon existing policies and targets. Additionally, G7 countries pledged to double the global energy efficiency target.
More ambition is needed regarding climate finance
Regarding climate finance, the text states that G7 countries “intend to be leading contributors to a fit-for-purpose goal” and acknowledged the need for “mobilising trillions” but refrained from making any new financial commitments or outlining clear pathways forward. G7 ministers made a commitment to present their nationally determined contributions (NDCs), by February 2025. These plans will feature economy-wide, absolute reduction targets encompassing all greenhouse gases and sectors, aligning with the 1.5°C goal. Additionally, they urged other major economies to follow suit.
Overall, countries need to make bolder policy commitments and agree on an ambitious deal on climate finance to curb emissions and drive climate action.
Contact
Elena Pérez Celis,
Head of Policy & Public Affairs
E: elena.perezcelis@bankersfornetzero.co.uk
