In 2024, the world is facing one of the most volatile geopolitical outlooks in decades. We are currently at risk of a troubling downward spiral, in which today’s geopolitical conflicts are complicating and slowing the energy transition, Center on Global Energy Policy at Columbia University reported.

More than 50 counties, accounting for half of the global population, are going to the polls, with high levels of political uncertainty across many of the world’s largest economies. Additionally, ongoing conflicts, extreme weather events, trade disputes and resource competition are contributing to geopolitical volatility. With the world nearly half way through a “critical decade” for climate action, overcoming geopolitical risks in order to start rapidly cutting emissions is paramount to limiting global warming. Structural and dynamic risks lead to grievances ripe for an economic, political and/or geo-politicized backlash against or away from climate action. 

From an African perspective, the key challenge is that the geopolitical tension between China and the US/EU will be used as an excuse this year to argue for a limited increase in climate finance. Today’s increasingly volatile and unstable geopolitical environment is one of the most powerful forces shaping the global energy transition and climate action. “We are currently at risk of a troubling downward spiral, in which today’s geopolitical conflicts are complicating and slowing the energy transition, while the risks of a disorderly transition risk exacerbating some of today’s most troublesome geopolitical trends”, Jason Bordoff, founding director, Center on Global Energy Policy at Columbia University, said.

All eyes are on the US presidential election and what Trump will do. Also, internationally, the major risk is emission increase due to the issues on the Red Sea shipping route (estimated at [being an increase in emissions up to] 11%), as well as announced increase in weapon manufacturing due to increased demands. Considering that the defense sector estimated carbon footprint stands at 5.5% of global emissions, this is concerning.

The most significant question to be addressed within the multilateral climate regime – in 2024 – is that of international climate finance. The new collective quantified goal on climate finance in the UNFCCC, mandated [as part of the Paris Agreement] to be agreed before 2025, is to exceed and replace the goal of $100bn per year originally agreed in Copenhagen. 

China’s large-scale production of clean energy technologies, such as solar panels, electric vehicles and batteries has brought down the cost of these critical products and spurred their uptake. But concerns over China’s dominance have further entrenched protectionist policies in the US and EU, especially, where climate action is increasingly intertwined with economic competitiveness and political support from domestic industrial bases. 

Analysis by Wood Mackenzie indicates that excluding Chinese cleantech from global markets would raise the cost of the energy transition 20% by 2050, or $6tn. While supply chain diversification is important, how the world navigates these tensions will pose major implications for the speed and cost of emissions reductions – including in developing countries that don’t necessarily want to choose between the US and China. Domestically in China, political support for new coal power continues in the name of energy security. How soon the country can peak its emissions and bring them into structural decline will largely depend on power sector reforms and whether massive deployment of renewables can dampen coal power utilization.

The OECD says these countries raised $115.9bn for climate-related projects, following a record surge in spending. However, analysis conducted by the CGD suggest that around $27bn of the $94.2bn annualincrease in public climate funds in 2022, compared to figures two decades ago, came from existing development aid. The $100bn target was set in 2009 at COP15 in Copenhagen to help developing countries cut their emissions and protect themselves from climate change. A group of ”developed” countries, including many European nations, the US, Canada, Japan, Australia and New Zealand, agreed to “mobilize” this amount by 2020 and then each year through to 2025. This money largely comes from countries foreign-aid budgets, which finance climate-related development projects. A smaller proportion is also raised from the private sector.

/Center on Global Energy Policy at Columbia University/