Europe to Lead the Way in Green Energy Transition, Says MIT Report

The MIT Technology Review, in association with Citrix, Morgan Stanley, and Salesforce, has come out with a new report named the ‘Green Future Index’ that has ranked 76 countries on the progress they are making toward a green future by reducing carbon emissions and developing clean energy technologies.

The index shows which countries are progressing fastest in global efforts to decarbonize and limit global heating in line with the Paris Agreement’s goals.

Europe has 15 of the top 20 countries in the index. The first place goes to Iceland, which aims to become carbon neutral by 2040. Denmark and Norway are in the second and third positions, respectively. Costa Rica, New Zealand, Canada, Singapore, and Uruguay are the other non-European countries in the top 20.

India is at the 21st position in the list, despite having a high rate of emissions, but is also quickly adopting renewable energy. At the end of the spectrum are ‘climate laggards’ and ‘climate abstainers.’

The laggards include South Africa at the 47th position, Vietnam at 49th, and Indonesia at the 57th position, where the pressure to develop the economy is running counter to decarbonization agendas. The 16 ‘abstainer’ countries at the bottom include Saudi Arabia, Iran, Qatar, Hong Kong, and Russia.

According to the report, energy and heat production accounts for 30% to 35% of the total emissions, and industry, construction, and transportation account for 70% of the total global emissions.

The first matrix of the ‘Green Future Index’ ranks each country according to their CO2 emissions contribution. The second pillar, energy transition, compares the contribution and growth rate of renewable energy in overall energy production. These two pillars account for 30% of the index scores.

The report further notes that coal-fired energy production decreased by 3% in 2019, with large decreases in the United States, the European Union, and South Korea. China, the world’s largest emitter of greenhouse gases, still depends on coal and gas for 70% of its electricity. At the same time, China is also the world’s single largest contributor to renewable energy additions in 2019.

Green Industry and Innovation 

The report states that countries that foster green technology add to global intellectual property stock and help all nations decarbonize. But the fact is that this stock is not growing particularly fast. The World Intellectual Property Organization (WIPO) reports that global applications for green energy patents were just under 17,000 in 2019, only 1.3% greater than in 2018.

The prospect for investment and innovation to build a green future is reflected in the index. The clean innovation index considers each country’s relative number of green patents, cross-border investment in clean energy, and food-tech investment. Many of the leaders in this section, including Chile, Kenya, and Morocco, have made big commitments to energy transformation.

Green Society

The green society matrix measures how countries are preserving their environment and adopting sustainable practices. It deals with the relative number of green buildings, the proportion of recycled waste, and efforts to increase forested land.

Singapore, the leader in the green society category, has the highest rate of non-domestic recycling in the world at 73% in 2019. South Korea, Taiwan, and Germany also score well on this measure. Ireland and the Czech Republic are among the global leaders in reforestation efforts. The United States has the largest number of green buildings relative to its urban population.

Climate Policy

The climate policy matrix accounts for 40% of the weighting in each country’s score. New Zealand, Denmark, and France lead in this category. The low performers in this section are hydrocarbon-dominant economies. Many, particularly those in the Middle East, have recognized the need to decarbonize and have made attempts to develop renewables.

The study adds that creating an effective market structure for pricing and trading carbon credits is a critical component of climate action policy, and over half of the countries and territories ranked in the ‘Green Future Index’ have implemented a system of tradable emission-based financial products.

In 2021, the European Commission is likely to introduce a bill for a Carbon Border Adjustment Mechanism (CBAM), which by 2023 will implement a transfer price on the estimated carbon content of imports into the EU.

“With hundreds of billions of dollars being injected into economies worldwide, Covid-19 has created huge momentum for developing green industries and financing infrastructure that will be clean, technologically advanced, and climate-resilient,” said Nico Crepaldi, Head of Custom Content, MIT Technology Review.

This decade will be marked by several transitions toward clean energy, decarbonizing industry, and other shifts in transportation, agriculture, and social norms. But these transitions have to happen equitably. The better-placed countries need to help their neighbors, share technology and best practices.

The UN Environment Programme (UNEP) recently released a report that says nations must boost their efforts to adapt to the changing climate scenario to avoid dire consequences in the future. The UNEP Adaptation Gap Report 2020 stated that about 72% of countries had adopted at least one national-level plan for adaptation and most developing countries have one in the works. Still, the funding needed to implement these programs is not growing adequately.

Earlier, United States President, Joe Biden, signed an executive order to rejoin the Paris Climate Accord on the first day of his assuming office on January 21, 2021. In his inauguration speech, Biden made it clear that addressing “a climate in crisis” was a priority, noting that “a cry for survival comes from the planet itself.”

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