By Jason Bordoff
Earlier today I was on the train leaving Davos after the Annual Meeting of the World Economic Forum and, as in past years, I wanted to offer a few reflections from the many events and discussions that I participated in on behalf of Columbia SIPA’s Center on Global Energy Policy, along with our Director of Research, Dr. Melissa Lott.
Under this year’s theme of “Rebuilding Trust,” the agenda prioritized the opportunities and risks of artificial intelligence; conflict and geopolitical threats from Russia’s war in Ukraine, war in the Middle East and disruptions in the Red Sea, and recent elections in Taiwan; and the outlook for the global economy in the face of risks to it from rising Great Power tensions and upcoming elections. The last topic was of particular interest throughout conversations this year, with half the world’s population voting in elections in 2024 and right-wing parties gaining support in many countries.
As Meghan O’Sullivan and I wrote this week in Foreign Affairs, the fracturing geopolitical landscape is a key factor in how quickly (or how slowly) the transition to net-zero emissions proceeds. Yet geopolitics rarely get the attention they should in discussions about climate change and the energy transition. I appreciated the chance to discuss these themes from our article with CNBC during my Davos visit.
The urgency of combatting the climate crisis remained high on the agenda. Former U.S. Vice President Al Gore expressed concern about countries trying to “wiggle” out of the COP28 agreement to transition away from fossil fuels, International Energy Agency Executive Director Fatih Birol declared the energy transition “unstoppable”, and International Monetary Fund Managing Director Kristalina Georgieva called on countries to shift direct and indirect subsidies of fossil fuels to support clean energy and cope with the impacts of climate change. Numerous experts warned that the possibility of limiting temperature rise to 1.5 degrees Celsius is slipping dangerously out of reach, and nearly impossible to realistically imagine at this point.
Yet, compared to recent years, the focus on climate and energy seemed more subdued at Davos this year. While energy security soared to the top of the agenda after Russia’s invasion of Ukraine, today’s modest prices and comfortable natural gas situation in Europe has clearly reduced the sense of urgency around energy security, notwithstanding oil supply risks in the Red Sea. Myriad corporate events and storefronts along the Davos Promenade offered far fewer mentions of ESG, amid a right-wing backlash and growing politicization of the term and sustainability issues.
The many discussions in which Melissa and I participated had a distinctly pragmatic feel. I heard tremendous interest from the investor community to finance green energy projects, but significant concerns about permitting, the durability of policy support, and supply chain bottlenecks.
In particular, I joined several conversations (such as the panel below) on how to meet the critical mineral needs of the energy transition responsibly and sustainably. I was pleased to hear many investors and companies discuss how technological innovation might reduce the projected growth in critical mineral requirements with improved battery chemistry or recycling, a topic former National Economic Council Director Brian Deese wrote about in Foreign Policy recently.
As a member of the WEF’s Steering Committee for Mobilizing Investment for Clean Energy in Emerging Economies, I heard many leaders from emerging and developing economies remind attendees about the significant growth in energy that’s required to deliver even a modest amount of prosperity in their countries, and that their countries not only have contributed least to climate change but will be most impacted by it. They also expressed a growing sense of resentment about the perceived inequity in how the energy transition is unfolding, a focus of our Energy Opportunity Lab here at the Center on Global Energy Policy. Several leaders explained why they should be allowed to develop their hydrocarbon resources and expand use of natural gas during the decades-long transition.
From trade tensions and conflict to Great Power competition and North-South relations, a key focus of the work of the Center on Global Energy Policy and Columbia SIPA’s new Institute of Global Politics is the geopolitics of climate change and the energy transition. A highlight of the week for me was a high-level roundtable we hosted on the linkages between energy, climate and national security with several ministers, CEOs, leading academics, and investors all discussing this absolutely critical topic.
I also discussed these links between geopolitics, energy and climate change in a breakfast discussion with S&P Global and Semafor, as well as on S&P’s ESG Insider podcast.
Over the course of the week attendees also discussed the solutions needed to accelerate the energy transition, as well as the real world impacts of climate change on the global community. CGEP’s own Melissa Lott led some of these conversations, during a WEF session on the causes, consequences, and cooperation needed to continue the acceleration of the energy transition. Melissa also led a discussion on the collective action needed to mitigate the physical impacts of climate change, focused on how to create healthier communities by motivating climate action for clean air technology solutions.
It was also fun to catch up with many friends from around the world who share our passion at SIPA’s Center on Global Energy Policy for urgently addressing the policy, technology, finance, and geopolitical barriers to rapidly accelerating the clean energy transition.
As in past years, I found by far the fastest way to navigate Davos’ traffic-clogged streets and make the most efficient use of time versus walking is an electric snow bike with fat tires–just make sure to bring to bring rain pants to cover clothes and a bag you don’t mind caking in snow and mud!
Throughout all of this week’s events, I was honored to bring CGEP’s expert insights and policy-focused reflections to so many important conversations. These conversations and others at Davos this year on climate, geopolitics, and energy remain front-of-mind for us here at CGEP and we look forward to continuing prioritizing them in 2024.
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