China should be a leader in the transition away from fossil fuels

It is 50 years this month since the United Nations Conference on the Environment was held in Stockholm where governments met to discuss how to respond to the growing threats from human activities to life on land and in the oceans.

Half a century later, the world is still struggling to respond to global environmental threats including climate change and biodiversity loss.

But growing concerns about the affordability and security of energy should accelerate the transition to clean domestic generation and supply across the world.

International market prices of oil and natural gas have surged as producers have struggled to respond to the rebound in the global economy after the pandemic.

The upward pressure on prices has also increased due to the Russia-Ukraine conflict, and many countries, particularly in Europe, have sought to reduce their energy imports from Russia.

Importers of fossil fuels have also sought to cut their exposure more generally to imported energy from politically unstable parts of the world.

Of course, the potential volatility of fossil fuel prices is well-known and sudden price increases have hampered economic growth during many periods over the past few decades. It is a feature of international fossil fuel markets that a few large producers can control, and sometimes manipulate, the price for consumers across the world. And a number of key sources are in politically fragile regions.

Naturally, many countries have sought to increase domestic energy supplies in response to these concerns about the security and affordability of energy.

In Europe, for instance, some countries are turning in the short run to domestic supplies of coal for electricity generation as a way of reducing their imports of Russian natural gas.

However, it would be illogical to believe that the solution to the insecurity and unaffordability of fossil fuels is further expenditure on developing coal, oil and gas.

The development of new fossil fuel reserves would be too slow to provide immediate relief. A recent analysis by Swedish researchers revealed that it takes more than five years on average from the discovery of a major new oil field to its first production.

Spending even more money on exploiting new reserves of oil, coal and gas would also lock in future exposure to uncertainty and volatility, with the risk of new fossil fuel infrastructure being abandoned before it has delivered a financial return, or even worse, it continuing to operate and adding to the damage it causes through local air pollution and climate change.

The International Energy Agency warned in a report last year that a global pathway to limiting global warming to no more than 1.5 C means no new development of fossil fuel reserves.

Many countries have recognized that radically improving energy efficiency to cut consumption, and speeding up the deployment of domestic solar, wind and other renewable power, is the best way of avoiding future crises.

Germany, for instance, has set a target of generating all of its electricity from renewables by 2035.

Better integration, for example within Europe, of grids and pipelines together with an expansion of storage can also help with energy storage. And the better the integration the less storage is needed.

The world's current dependence on fossil fuels is creating a serious risk to its living standards and economic prosperity. Air pollution already ends many lives prematurely, and damages many others, and thereby knocks several percentage points off annual economic output in both developed and developing countries. Climate change impacts, such as flooding, landslides, desertification, more frequent and intense extreme weather, and sea-level rise are causing increasing harm to lives and livelihoods.

And the spikes in international market prices of natural gas and oil are raising the costs for China's citizens and businesses.

The latest figures show that imports account for about 70 percent of China's consumption of oil, and about 45 percent of its gas consumption.

And although China supplies more than 90 percent of the coal it consumes, it is clear that China's economy, and indeed the global economy, would benefit from speeding up the switch away from fossil fuels along the path to carbon neutrality.

The great economic harm that fossil fuels cause through air pollution and climate change disproves any claim that they are cheap.

This global energy crisis provides an opportunity for the G20 countries to demonstrate international leadership by making the case for bringing forward an end to the age of fossil fuels. China, with its leadership in technology and its ability to take new methods to scale quickly, can be a real leader, benefiting both China and the world.

Renewables already supply the cheapest electricity in many parts of the world, and can result in lower bills for households and businesses. Other zero-carbon technologies, such as batteries and electric vehicles, are rapidly improving in quality and falling steadily in price.

Fossil fuel producers can also benefit by diversifying their economies and taking steps to retrain and re-deploy workers into different roles, including in the growing clean energy sector. It is important to create a just transition by investing in people and places which may have to adjust.

The transformation to a sustainable, inclusive and resilient economy will create jobs and prosperity across the world. It can create an attractive form of economic development and growth that is better than the dirty and destructive consequences of our dependence on fossil fuels.

This will require good public policy, as well as investments in infrastructure, innovation and creativity. But the returns will be immense for today's and tomorrow's generations in every country around the world.

The author is I.G. Patel professor of economics and government and chair of the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn