How Joe Biden can accelerate the transition to clean energy
US President-elect Joe Biden speaks about the latest massive cyber attack against the US and other targets of the Biden administration in Wilmington, Delaware, December 22, 2020.
Leah Millis | Reuters
As we enter the third decade of the 21st century, we are facing a green industrial revolution. Now is the time for President-elect Joe Biden and his brilliant team of scientific, economic and national security experts to work with the private sector to accelerate this historic transition to a low-carbon world.
With an ambitious $ 2 trillion plan to address the climate change threat more broadly than any other government, the Biden presidency could mark a turning point in federal government policy and usher in a new era for clean energy.
And the newly announced Biden environmental team will find a receptive business community to work with. In recent years, efforts to combat climate change in the United States have not been led by the federal government and federal politics – although many states and cities have continued to act independently – but by corporations and financial markets.
The private sector has increasingly focused on sustainability and climate risks, not only due to heightened climate change awareness and accountability to stakeholders, but also due to dramatic innovations that have significantly lowered the price of clean energy and catalyzed a shift in creating markets, Create financial incentives and motivate companies and institutional investors to benefit from these trends.
In fact, renewable energy is cheaper than traditional electricity generation for more than two thirds of the world. It was only last year that electricity generation from renewable sources surpassed coal in the US for the first time in modern times.
It was also a turning point for corporate climate announcements as more companies set goals for zero net emissions with clear timelines and actions.
Meanwhile, more and more investors are refusing to invest in conventional energy sources as economics become less attractive and they focus instead on clean technologies. The value of private equity investments in renewable energy projects has doubled in the past year, and in the past year and a half, venture finance for climate tech companies has increased from $ 418 million in 2013 to $ 16.1 billion -Dollar.
It was also a turning point for corporate climate announcements as more companies set goals for zero net emissions with clear timelines and actions. A number of tech companies announced significant decarbonization goals, including Google, which is committed to offsetting all the carbon it has ever emitted and being 100% renewable by 2030.
In the transportation sector, JetBlue was the first US airline to achieve CO2 neutrality for all domestic flights. In the telecommunications sector, AT&T has pledged net carbon neutrality by 2035 and introduced a new climate change analysis tool to quantify climate risks across the network. In particular, several major oil and gas companies have pledged to decarbonize their businesses significantly this year, including BP, Shell and, just last month, Equinor.
According to a recent report that analyzes progress under the Paris Agreement and finds significant private sector momentum, over 1,500 companies, with combined sales of $ 12.5 trillion, have now set net zero emissions targets.
Throughout modern history, there have been a number of turning points in the energy sector that have brought about transformative change: the industrial revolution in the 1750s and 1760s, which ushered in the rise of coal power and the use of steam; the invention of the first widespread light bulb in the 1870s, which extended the working day and improved the quality of life; and the rise of oil, which in 1964 overtook coal as the main global energy source and ushered in a new era of mass production and global transportation.
Today we are at a different turning point as we continue on the path towards a clean world. But we have to accelerate the pace and act faster and more comprehensively in order to counter the existential risks and costs of climate change.
In 2020 the private sector led the way, but the federal government still has an opportunity to get involved again. The future Biden administration should set up a Sustainable Recovery Task Force composed of business and labor leaders who can offer climate and economic policy a private sector perspective, and call a summit on better reconstruction within the first 100 days. Participate in the private sector representative. Advance a detailed climate agenda.
We believe this moment represents a historic opportunity for our new national leadership to join forces with corporations and institutional investors to take bold climate action to accelerate the global transition to a low-carbon economy.
Laura Tyson, a former chairman of the President’s Council of Economic Advisers during the Clinton administration, is a professor at the Haas School of Business at the University of California at Berkeley and a member of the Board of Advisors for Angeleno Group, LLC, an energy and climate solutions investment firm . Daniel Weiss is co-founder and managing partner of the Angeleno Group.