El lado bueno de abajo

“Everyone has a plan until they get punched in the mouth” 

– Mike Tyson, Boxer 

Sería un eufemismo decir que 2024 fue un año desigual en cuanto a avances en la gestión del cambio climático.

On the upside, we saw record deployment of wind, solar, and batteries worldwide; in places like Germany, permitting reforms paved the way for a doubling of additions. We saw new policies put into place in Europe, the largest gas import market, to control oil and gas-related methane emissions – the most potent climate warmer. We also saw final investment commitments to a half-dozen major pioneer carbon capture and sequestration projects, demonstrating a technology which will be critical to diverting emissions from heavy industry. Even the global nuclear energy industry began to creep back to life in 2024, with six new modern plants coming online — from the U.S. state of Georgia (albeit with delays) to the United Arab Emirates. Large tech sector giants stepped forward to contract for new and underutilized existing nuclear energy output.  

On the downside, global carbon emissions continued to hit record levels. Coal plant additions outpaced coal plant retirements. Wind, solar, and carbon capture faced major permitting hurdles in many countries, while inflation slowed offshore wind additions to a crawl. 

Beyond the specifics, traditional “Climate Policy” did not have a good year. Geopolitical conflict is worsening, multilateralism is breaking down, and protectionism is gaining popularity, meaning global commercial and political cooperation on climate management is getting harder. Inflation, economic, and other factors have created a sour and populist political mood in rich countries. For many, this culminated with the election of leaders who explicitly ran on anti-climate positions, making it a subject of culture wars. The U.S. elections were perhaps the clearest example, but the U.S. was not alone; Europe and other nations shifted right and threw out incumbents who were identified with aggressive climate action. Tellingly, hardly anywhere was climate management put forward as a major selling point by major political parties. We may have reached “Peak Climate Policy” in the traditional sense. 

A better approach  

Getting knocked down is not pleasant, but it does have the virtue of making you think deeper about your strategy. 

The last year has made more evident what has been apparent to some of us for some time now. Global energy demand is growing rapidly, especially for the billions of people who lack access to advanced economy levels of energy, and this will continue to put strain on the decarbonization agenda. The world is still 80% fossil fueled, a percentage which has not changed for three decades, and it will take time, likely well beyond midcentury, to decarbonize a $50 trillion energy sector. Climate change, while important, is not a top political priority in and of itself. It ranks low in the priorities of most voters – well behind economic prosperity, geopolitics, and energy security, despite publicity around increasingly disruptive weather events.  

To be successful, we need to move our thinking from traditional “Climate Policy” to an approach that is better harmonized with economic, geopolitical, and political realities.  

The details 

What does that mean in practice? 

• Electricity: Since decarbonizing the electricity grid is key, we need to pursue the lowest cost solution mix that maintains energy security and reliability. In the short term, this will mean speeding up the deployment of mature weather-dependent technologies such as solar and wind where we can. But in parallel, we need to accelerate the commercialization and deployment “clean firm” technologies that can provide round-the-clock reliability, reduce overall system costs, and reduce the infrastructure requirements of a fully decarbonized power system. Current candidates include advanced geothermal, carbon capture for power, and nuclear energy; long duration energy storage can provide a supplement to these fully dispatchable technologies. 

• Industry: Heavy industry – cement, steel, plastics – account for a quarter of global emissions, and we need to accelerate low-carbon process innovations and electrify where we can. In a multi-decadal transition, technologies such as carbon capture and in some sectors hydrogen may be important bridges. Even setting climate aside, these technologies will be critical to innovation leadership and economic competitiveness, particularly as major importing markets—such as the European Union—incorporate emissions pricing into trade policy.  

• Regional Specificity: We need smarter regionally differentiated strategies. In some states and nations with greater receptivity to traditional Climate Policy, we can and will continue to push (and push back against rollbacks of) low-emissions performance standards for the grid, transport and industry. In other regions, we can build coalitions around policy that advances high employment, localized industrial development, and global competitiveness with climate benefits a clear byproduct. The U.S. Inflation Reduction Act is a good example, spurring low-carbon battery and solar manufacturing in politically conservative regions which has led to bipartisan support for portions of that law. Nuclear energy may be able to advance where energy security ranks high on the agenda (for example, Texas and Eastern Europe). 

• Realize Public Benefits: We need to rethink the model of clean energy infrastructure buildout to accelerate progress. Beyond “permitting reform,” greater sharing of economic benefits with hosting regions, including equity ownership, needs to be explored. 

• Grounded in Reality: We need to reckon honestly and realistically with the role of fossil fuels in our energy system, given seemingly insatiable demand. Hoping that fossil fuels will be gone by 2030 or 2050 is not a policy. The only questions that matter are, first, how fast can we develop cost-competitive alternatives? And, second, as we transition, are we going to control fossil emissions or just let them spew into the atmosphere and into our lungs? 

It’s complicated, but we’re up for it 

In short, we need more solutions, not fewer. We need to take the long view and imagine a century-long transformation for a planet that may need to double its energy supply. We need to work with economics and geopolitics, not against them. And we need durable, pragmatic strategies that build coalitions for action rather than divide societies around symbolic rhetoric. Multiple strategies, not a single, fragile Plan. 

This has always been CATF’s operating model: eschew ideology, find common ground and win-wins where we can, fight head on where we need to, and stay nimble. Our approach is even more relevant today in a geopolitically fragmented, fiscally drained, and culturally and politically divided world.