Carbon50

Japan is missing an opportunity to promote energy savings

INSIGHTS

Japan is missing an opportunity to promote energy savings

With rising energy prices Japan seems to have forgotten its decarbonization goals and is missing on an opportunity to promote energy savings.

In April 2021 prime minister Suga announced his target of reducing CO2 emissions by 46% compared to 2013 levels. If the number “46%” was subject to debate, it fits into the 2050 “net-zero” target. To achieve these goals, Japan will have to reduce its emissions by ~4% by year, every year.

Prime minister Kishida’s government is now considering subsidizing utility firms to curb power prices as well as a subsidy scheme for gas. The Japanese government has already been subsidizing gasoline wholesalerssince January to reduce retail prices. What was supposed to be a temporary measure, reviewed weekly, was extended in April. According to Reuters, these measures aim at achieving real economic growth of 2%-2.5% this fiscal year.

These measures will keep demand high for fossil fuels, maintaining Japan CO2 emissions above target levels and failing to bring any sustainable solution to future energy crisis.

Instead, by letting the retail price of energy rise and by promoting energy savings measures Japan could not only make progress on its climate goals but also ensure that future volatility of prices and long-term scarcity of fossil fuels would have a lower impact on its economy and its population.

Japan could promote Energy saving measures similar to what France recently announced, including temperature limits in buildings, limiting cars speed or turning-off advertisement displays at night. But it could of course go further. Subsidies could then be focused on consumers with low revenues and without alternatives.

Climate goals are extremely unlikely to be achieved without a reduction in consumption. Japan has the opportunity and a plausible excuse to start implementing measures that could not only have a short-term impact but set the direction of a new strategy with a real chance of meeting its climate goals.

On the necessity of reducing our consumption

INSIGHTS

Making it to a 2.0°C world will likely require a global reduction in consumption

 

Plotting the global CO2 emissions since 1850 and comparing them to IPCC data shows that to have an 83% chance to stay below a 2.0°C global warming path global emissions must be divided by ~4 in the next 30 years.

Kaya’s identity offers a way to understand the impact of such a goal on the global economy

If CO2 emissions must be divided by 4 in the next 3 decades, the right part of the equation must also be divided by 4. A closer look at each term shows that this would likely require a global reduction in GDP per Capita:

  • World population is expected to grow by ~30% by 2050 (UN)
  • The Energy intensity of GDP has been reduced by ~35% in the past 30 years (data)and we could reasonably expect a similar outcome in the coming 30 years. Energy efficiency is an engineering problem and given its impact on companies bottom lines it is usually a priority in the corporate world. We can therefore expect sustained efforts on this topic in the coming years.
  • It means that the GDP per Capita X Carbon Content of Energy must be divided by ~3.4 by 2050 and that any effort that is not done on one must be done on the other

If we want to keep the same GDP per capita for the next 30 years, the Carbon Content of Energy must therefore be divided by 3.4 in the same period, or a reduction of 70% vs current levels. In the past 30 years it was only reduced by 6%, despite the “new renewable boom” of the last decade and the development of nuclear capacity.

It would be dangerous to bet the future of climate change and of our planet on technological changes far from those that we have been able to achieve in the past similar period.

Reducing global GDP per capita seems a much safer choice to prevent the consequences of climate change.