McKinsey and Company director Scott Nyquist authored on article entitled Great News on Emissions. Really. He concludes that the US and EU have cut emissions while growing their economies.
His article provides an upbeat view.
So it’s very important that in both 2014 and 2015 the global economy grew—and energy-related emissions didn’t. In the 40 years that the International Energy Agency has been tracking emissions, this is the first two times that year-on-year energy-related emissions have been flat or less, without an economic downturn. And in 2013, emissions grew less than the global economy. For perspective, energy accounts for more than two-thirds (68 percent) of global GHG emissions, and energy use increased more than 150 percent from 1971 to 2013.
So all that sounds pretty wonky. Why does it matter? Because it means that it is not only possible, but a reality that the link between emissions and growth can, in fact, be cut. Indeed, in a number of developed countries, that is already happening. In 2014, for example, the EU grew modestly—and cut emissions by more than 5 percent. The United States saw power-related carbon emissions decline 10 percent from 2005 to 2014, due to greater efficiency—in effect, like Europe, it is creating more wealth using less energy—and the displacement of coal with cleaner natural gas.
China and India have room to approve as most of us know.
But here, too, there are encouraging trends. The rate of growth of emissions in China is slowing, as its economy becomes less energy intensive—services now account for more than half of GDP, the highest ever. China has also begun to get serious about growing less filthily. In part because of pressure from a public literally sick of living in smog-choked cities, the country is investing in more efficient and cleaner energy use. In 2014, Chinese emissions increased less than 1 percent compared to the previous year, even as it grew 7.3 percent. In the previous decade, China’s emissions had grown an average of 6.7 percent a year. So that’s a big change. The big reason: China is depending less on coal, which accounts for more than 80 percent of its energy-related emissions.
The author concludes, and I agree, that technological innovation is the key to solving greenhouse gas emissions issues. While the emissions issues are far from solved, great steps have been made. The investment in new technology, renewables, innovations in business models and financing approaches present one of the great business opportunities the world has ever seen. Trillions of dollars will be invested over the next 10 years and beyond to address these issues as more energy is demanded, but more efficient use and alternative ways of generation energy and controlling emissions from traditional sources opens up an economic boom.