Publisher’s Note

Seven Points to Consider on Climate ChangeMeasures
By Masakazu Toyoda
In mid-November last year, COP26, which was held in
Glasgow in the United Kingdom, came to an end. Evaluation of
the outcome varied greatly from person to person. Some say it
was a failure, others say it was a great success, reflecting each
person’s expectations and attitude towards climate change. It is
important to note that climate change is a global problem, andthere is a limit to what can be accomplished by the efforts of afew countries, so it is vital to build a global consensus. The 1997
Kyoto Accord set top-down reduction targets, but as a result only
37 countries and regions agreed to reduce their emissions. TheUnited States itself, which contributed greatly to the formation of
the agreement, did not participate in it due to congressional
opposition. The Paris Agreement was a bottom-up process inwhich each country decided on its own reduction target andcommitted to it, and as a result 186 countries and regions
participated. This is proof that climate change cannot be dealt
with through imposition or coercion.
I would like to list seven important considerations for thesuccess of climate change measures.
First, should we aim for 1.5°C or 2.0°C? If the acceptable
range of temperature increase since the industrial revolution is1.5°C, it would require a net reduction of greenhouse gas (GHG)
emissions to zero by 2050. If it is 2.0°C, it would be an 80%
reduction. By the end of COP26, 144 countries and regions had
committed to carbon neutrality in 2050, and 154 if commitments
to 2070 are included. However, the International Energy Agency(IEA) estimates that even if these more than 154 countries andregions achieve their goals, a 1.8°C increase will be inevitable.
Second, the UN’s Sustainable Development Goals (SDGs)
include 17 goals, but is climate change the most important one?
The UN goals certainly include “tackling climate change”, butthere are also at least six goals related to economic growth,
including poverty eradication, hunger eradication, health andwelfare for all, and quality education. Incidentally, according to aUN survey, the top three concerns of many developing countries
are quality education, health and welfare, and poverty eradication.
Climate change only ranks around 10th.
Third, which countries have spent their carbon budgets? The
cumulative amount of GHG emissions that the world can tolerate
is called the carbon budget, and if we look at the period up to2019, apart from changes in land use, the consumption of OECD
countries will account for 57%. If we look at this in terms ofcumulative emissions per capita, even in 2070, OECD countries
are consuming twice the 2°C level, while non-OECD countries
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are consuming less than the 1.5°C level. In short, it is the OECD
countries that are consuming most of the carbon budget.
Fourth, the amount of zero-carbon energy available may varyfrom country to country. In the European Union, there are many
areas with abundant wind power, although solar power is about
the same as others. In South Asia and Japan, however, there is alimit to the number of areas with stable wind power, and there isalso a limit to the amount of sunlight due to high rainfall. Inaddition, the EU has a cross-border power grid that can flexibly
respond to changes in the weather. Asia’s wide-area power grid islimited, and Japan’s geopolitical constraints make it unlikely forthe time being.
Fifth, do we have enough zero-carbon energy technologies inplace? Excluding renewable energy, we have nuclear power andhydrogen, which is rapidly gaining attention. It is undeniable that
there is a limit to the introduction of nuclear power due to safetyconcerns. There are various types of hydrogen, such as bluehydrogen made from fossil fuels and carbon capture and storage(CCS), green hydrogen made from renewable energy andelectrolysis, and yellow hydrogen made from nuclear energy.
However, the cost of hydrogen is relatively high at present, andits introduction in developing countries is not easy. There is anurgent need to reduce the cost through technological development
in developed countries.
Sixth, will a border adjustment tax not bring about a NorthSouth confrontation in order to prevent carbon leakage?
According to WTO rules, it is not consistent with national
treatment to impose a tax on another country that is not imposedon one’s own country. In addition, if it is developed countries thathave spent most of the carbon budget, what right do they have toimpose border adjustment taxes on developing countries?
Seventh, are developed countries ready to support developing
countries? At COP26, there was strong criticism that the $100
billion per year in climate finance pledged by developed countries
had not been met. New post-2025 targets will be discussed, butwould require substantial support.
There are many more points to consider, but even just looking
at these seven points, it is not easy to solve climate change
without creating a North-South problem. We need to keep inmind that we should have a multilateral perspective.
Masakazu Toyoda is chairman and CEO of the Japan Economic Foundation(JEF). He previously served as chairman and CEO of the Institute of Energy
Economics, Japan, after having been vice minister for International Affairs at theMinistry of Economy, Trade and Industry.
Japan SPOTLIGHT • March / April 20221