OBAMA’S CLIMATE PLAN SIGNALS A MOVE AWAY FROM OIL, COAL AND GAS

USA President Obama has launched a proposal for the USA to greatly reduce the greenhouse gas emissions from its power plants.

“These steps confirm that Vattenfall’s change of strategy towards more renewable energy generation is the right way to go,” says Andreas Regnell, Head of Strategic Development at Vattenfall.

China and the USA are the world’s largest emitters of greenhouse gases, and the plan presented by President Obama aims for the USA to reduce its emissions by a third: 32 per cent by 2030, based on 2005 figures. American power plants account for approximately 40 per cent of the country’s total carbon dioxide emissions, and the reduction is to be achieved by a series of new laws and regulations.

At the climate conference in Copenhagen in 2009, neither the USA nor China were prepared to accept the climate targets which were set. However, a move is now starting away from oil, coal and natural gas, according to Obama, whose climate change plan is designed to lead to a fossil-free US welfare economy in the future.

Two viewpoints
There are basically two prevailing and legitimate viewpoints regarding the world’s energy situation, according to Regnell.

“The world has invested a lot of money and resources in an infrastructure of coal, gas and oil for an energy generation system which works – and creates a lot of jobs. The world is largely unanimous that we must reduce the use of fossil fuels, but the speed of change must be carefully considered, so as to safeguard the global economy. A renewable system will cost a lot of money and lead to higher electricity prices.
“We don’t want to move forward more quickly than the rest of the world, as we would then lose our competitive power - To go too fast will harm the economy, and won’t save the world.”

He summarises the other viewpoint as follows:

“We know that we must convert to a renewable system as quickly as possible, and we are already behind schedule. The long-term economic consequences of failing to reach the climate targets are enormous. The transition implies great opportunities for technological development, and will create new jobs. To lead these developments will create competitive power and greater prosperity.”

Applying pressure
“As I see it, the weight of opinion is now beginning to tip from the first viewpoint to the second, in a global perspective.”

Europe has taken significantly more steps towards renewable energy than both China and the USA, but the fact that the world’s two economic superpowers have now committed themselves to following this direction is putting pressure on the rest of the world, Regnell believes. He expects a quite different dialogue at the climate meeting in Paris in December than the one prevailing in Copenhagen six years ago.

“At that time, it was the cost of an energy transition that created an obstacle. Obama is now saying he is convinced that renewable energy will be able to deliver good development, prosperity and growth, and offers a way of achieving the climate targets.”

How will this affect Vattenfall?
“Only in that we should continue on the path towards renewables that we are already taking – and if anything speed things up a bit.”

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