A group of forward-thinking, highly industrialized states and regions are developing innovative policies to transition their economies towards a low carbon pathway. They have embarked on this journey as part of The Climate Group’s Energy Transition Platform – a collaborative space to share best practices and overcome common challenges.
In this blog, Anne-Sophie Dörnbrack, States & Regions Policy Manager (Energy Transition), The Climate Group, highlights the successes, opportunities and obstacles that these sub-national governments are facing.
We are living during an era of unprecedented growth of renewable energy. The numbers clearly show it: in 2015, almost a fifth of global electricity came from renewable energy; in the same year, more than 8 million people were employed in this sector.
The figures are encouraging; but significant challenges still remain if we are to reduce greenhouse gas emissions to a level that will enable us to limit the increase in average global temperatures to below 2 degrees Celsius and avoid the worst impacts of climate change.
We are working with leading state and regional governments here to support them to accelerate their low carbon transition and overcome common challenges. On Tuesday this week in Brussels, we will host an event to showcase the invaluable learnings and solutions they have achieved through our Energy Transition Platform.
Launched last year, it is a vast and powerful network of 11 partner regions – led by North Rhine-Westphalia – that have a combined GDP of US$4.5 trillion, which is about the same as Japan.
The platform enables the governments to learn about their peers’ activities, and it facilitates joint solution-finding as well as the adoption of innovative policy models.
A low-carbon transition is inevitable – for socio-economic and environmental reasons. To succeed in this challenge, governments must combine their ambitious renewable energy and climate targets with a specific plan of how their industry and economy could look in the future.
For example, they must make clear that an early transition will lead to a competitive advantage in the future. They must draft a strategy of the opportunities for job creation, as well as job transitions into new or restructured sectors.
At the same time, they need to recognize that certain communities cannot transition easily, and need long-term support. Governments can also develop roadmaps together with the people that are affected by job loss due to the shift away from fossil fuel industries.
But these measures alone will not be enough. A successful transition needs a holistic and inclusive approach supported by a political leadership. It is political leadership, paired with bold policies, that will foster it.
That’s why it is important for all parts and levels of governments to be committed to this pathway. Following a joint approach is crucial, with concerted regulations, incentives and information campaigns.
A clear, honest and positive process of engagement and consultation with citizens and stakeholders can ensure public support and promote innovative bottom-up initiatives. For example, North Rhine-Westphalia’s Climate Protection Plan was developed through a two-year long participatory process – which involved 400 stakeholders from the public sector, business and civil society. As a result, the plan was broadly supported in the end.
Finally, it is important to underline the fact that states and regions with a diverse economic background can more easily transition to a low carbon economy than those that are dependent on one sector, with jobs and revenues being focused on one area. Economic diversity presents more options for a clean energy transition and improves the adaptability of a state in making the shift.
States and regions are best placed to drive the low carbon energy transition, as they operate at a level where some of the most flexible and forward-thinking policies are developed. They have powers and competences over key areas needed to take effective action, and they are closer to local business and communities enabling a faster response to different policy needs.
Being so close to their citizens, they can solve issues arising from lack of information about how to shift to a low-carbon economy or uncertainties about technological implications more successfully. For example, some Energy Transition Platform governments successfully addressed citizen groups that were opposing renewable energy projects, by engaging them and all parties involved, such as project developers, early on – like the Energy Dialogue project in North Rhine-Westphalia.
Governments can also support local and community energy projects to ensure a fair distribution of revenues and thereby avoiding the feeling that only big or external companies benefit from renewables deployment. This was done by Minnesota through their Community Solar Gardens, at the same time upscaling their solar energy growth rate.
Another challenge for ambitious states and regions is that energy-intensive industries are often not supportive of decarbonization policies, neither open to innovation and new business models, including a more long-term approach.
Sometimes these industries are concerned about affordable energy, international competitiveness and long pay-back periods for investments. State and regional government are trying to address these concerns by building trust and moving away from politics, focusing instead on the economic and technical support that industry needs.
Last year, the Energy Transition Platform has intensely worked on all these issues. Now, smaller groups of partner governments will come together in Innovation Labs – with the aim of further developing a specific policy model, or to find solutions for a common challenge.
The Innovation Labs will go beyond the pure experience sharing: they will also test how governments can best develop policy solutions together and replicate successful models in their regional context.
Three Innovation Labs have been formed around three main themes: improving energy efficiency in buildings, developing community renewables programs and establishing better dialogue forms with the industry.
By working with knowledge partners – such as the Grantham Institute for Climate Change and Environment at Imperial College – and including relevant experts from the public and private sectors, we will make sure policy options are well analyzed and different perspectives discussed.
The Energy Transition Platform is funded by Stiftung Mercator, and you can learn more about the initiative and read all the current case studies here.
by Anne-Sophie Dörnbrack