The annual rate of decarbonisation required to limit global warming to 1.5 degrees has risen to 20.4 per cent, according to a study by PwC.
The world’s carbon intensity dropped by 1.02 per cent last year, the slowest decrease in more than a decade, according to the PwC study. This slowdown highlights a faltering in efforts to decouple economic growth from carbon emissions, the survey found.
Carbon intensity measures the amount of carbon emissions emitted per million dollars of gross domestic product (GDP).
The PwC Net Zero Economy Index compares global CO2 emissions data and economic growth with the carbon rates needed to adhere to the targets agreed under the Paris Agreement on climate change in 2015.
The study shows that the breaching of the 1.5 degree rise in global temperatures target set in Paris is becoming a reality and even limiting global warming to two degrees – the lowest end of the Paris Agreement’s ambition – would require major changes.
“I don’t know what that extra half degree between 1.5 and two is going to do. I do believe it is going to be much more impactful than that first half degree than between zero to 0.5,” David McGee, environmental, social and governance partner at PwC, said. Each half degree rise in temperature does not have the same impact, Mr McGee said, rather it is exponential.
The study found that the rate at which the world will need to decarbonise will be 20.4 per cent year on year going forward, a rise from 17.2 per cent last year. Globally, it means people must decarbonise the planet at a rate of 20 times faster than that which was achieved last year when the actual outcome was 1.02 per cent.
“Time is running out to bridge the gap between ambition and action to ensure a sustainable and resilient future for all,” Mr McGee said.
Historical data since 2000 shows no country within the G20 group of industrialised nations has reduced its decarbonisation rate by more than 11.5 per cent in a single year. France came the closest to achieving that goal, dropping its rate by 11.08 per cent in 2014.
From an Irish perspective, separate Environmental Protection Agency (EPA) data shows that the country’s greenhouse gas emissions decreased by 6.8 per cent in 2023. It is the first time the State’s carbon emission levels have fallen below 1990 levels.
However, the State is not on track to meet either national or European Union emissions reductions targets for 2025 or 2030. Ireland’s 2030 target under the EU’s Effort Sharing Regulation (ESR) is to achieve a 42 per cent reduction in emissions by 2030, compared with 2005 levels, with annual binding emission allocations over the 2021-2030 period.
EPA projections currently show Ireland achieving only a nine to 25 per cent reduction on 2005 levels, falling significantly short of the 42 per cent target. Ireland’s Climate Change Advisory Council has warned that the cost of not meeting our EU ESR targets could exceed €8 billion.
The study shows that the global use of renewable energy has risen by 14 per cent to 3,870 gigawatts (GW) in 2023, compared with the previous year.
However, fossil fuels were still the dominant energy source. Fossil fuels usage also increased in 2023 by 1.5 per cent to 16,007GW, despite the rise in renewable energy.
The study says challenges such as inflation, geopolitical tensions and higher interest rates make the transition away from fossil fuels more complicated because of short-term pressures.
Looking to the future, renewable energy is set to become the largest electricity source in 2025, building on gains seen in 2023, according to the PwC survey. However, with the increased demand on electricity grids globally as the world turns towards electric vehicles and electric transport systems, there is a need to ensure such systems are effective and that innovations in the business sector are incorporated. i
The study also said that emerging economies without support from wealthier nations. are facing challenges in reducing their carbon emissions.
Countries in the Group of Seven (G7) industrialised nations reduced their carbon intensity by 5.31 per cent last year. However China, India, Brazil, Russia, Mexico, Indonesia and Turkey saw a 0.04 per cent increase.
In light of Cop29, which began on Monday, the world needs to establish collective goals on how to deliver on how to finance climate action and allow developing nations to meet their goals, said Mr McGee. “Agreeing a fair and ambitious financial target is critical,” he said.
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