According to the Paris Agreement, limiting global warming to 1.5 degrees Celsius will require greenhouse gas (GHG) emissions to peak before 2025 and reduce by 43% in 2030. This means the world has the next six months to form a peak and another five years to reduce it by almost half. As where the world stands today the peak emission is way ahead in the future cause in the next few years it will add nearly 125709 coal power plants.
On the EV and solar front, the progress made in the last five years has been massive but currently, it is facing its first slowdown, especially in the EV industry. The raw material prices are down as the demand is low. This has resulted in various capex plans being delayed as tariff gets imposed on related imports.
In addition to this various actions are being taken by governments to promote local manufacturing in these sectors but at the expense of restricting imports of skills and equipment. Given the geopolitical tensions that are rising every passing month, it is becoming important to follow through on common goals.
The result of these delays can already be witnessed as El Niño and the hottest summer together have resulted in higher food prices globally. If the energy transition momentum falls in the coming quarters then the peak will surely get delayed by years.
Thus, geopolitical tensions need to ease as financing and implementation of a global plan requires an international coordinated effort.
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