The New Geopolitics of Climate Change

For the world’s climate activists, the last half of 2020 has been both the best and the worst of times. Even as the pandemic raged, at the September meeting of the United Nations General Assembly Chinese leader Xi Jinping unexpectedly pledged to make the world’s second-largest economy carbon neutral by 2060. Weeks later, Japan, the world’s third-largest economy, one-upped Beijing by pledging to do the same thing, but 10 years earlier. And in early November, the American people elected Joe Biden president on by far the most ambitious climate policy platform ever put forward by the world’s largest economy.

Less encouragingly, the same period also brought an unrelenting stream of bad news on the state of the world’s climate: In September scientists reported that two of Antarctica’s largest glaciers were close to collapse, threatening several meters of additional sea level rise; in early October five tropical cyclones formed in the Atlantic Ocean for only the second time in recorded history; and just weeks later came the heartbreaking report that half the Great Barrier Reef’s corals have died off just since 1995.

This mixed picture leaves the world standing at a familiar crossroads. In the face of rapidly-accumulating evidence of an impending climate catastrophe, the world’s major economies, buoyed by political change in the United States, look ready to finally take serious steps to cut greenhouse gas emissions. But there have been false hopes before, in the mid-1990s, when the U.S., then the world’s largest emitter, declined to ratify the Kyoto Protocol; in the late 2000s, when major climate legislation stalled in the U.S. Congress; and in the mid-2010s, when the conclusion of the Paris Agreement failed to shift policy and markets as much as its architects hoped, in part because the U.S. once again took a hard political turn against climate action and dismantled its climate policy.

Will this time be different?

In one very important respect, the answer is clearly yes. Each previous period of hope for ambitious climate action depended on the United States’ willingness to back international cooperation on climate change, and a robust regulatory regime to underpin it. This time, though, is decidedly different. Ambitious climate action, like Beijing’s and Tokyo’s seemingly dueling carbon pledges, is increasingly driven not by a vision of cooperation, but one of geopolitical competition. This conceptual shift is matched by a tactical one: Instead of an emphasis on domestic regulatory sticks to drive down greenhouse gas emissions, the focus is moving to one more focused on carrots to promote technological innovation and development – the better to compete with would-be rivals.

The world still needs a healthy dose of cooperation and regulation to tackle climate change. But the new geopolitics that now shape climate policy offers renewed hope that this time, major economies might finally produce a durable plan to tackle the climate crisis. These new dynamics are especially important given the accelerating impacts of climate change, which make it increasingly clear the world will not only have to slash its carbon emissions, but eventually take more carbon dioxide out of the atmosphere than it puts in.

In another key break with the past, it’s now China, not the United States, that stands at the center of the new geopolitics of climate change. While America’s fickle domestic politics have historically been the fulcrum on which international climate plans teetered, they now turn on the world’s reaction to the rise of China.

From Cooperation to Competition, Because of China

The central importance of China to global climate change stems from its economic structure and importance to world trade. While dramatic action is needed from all the world’s major emitters to prevent catastrophic climate change, China is in many ways the crux of the challenge. In addition to being the world’s most populous nation and largest consumer market, China is also by far the biggest producer of carbon-rich coal and emissions-intensive products like concrete and steel.

Unsurprisingly, given this dominance in heavy industry, the world’s second-largest economy has been the largest single source of carbon dioxide, the main greenhouse gas, since around the turn of the 21st century. And while the United States and European countries are responsible for the majority of all human-related emissions since the start of the Industrial Revolution, China accounts for over a quarter of all the carbon cast into the atmosphere over the past decade. All of this makes China’s consumers, companies, and Communist Party cadres absolutely critical players in any serious effort to tackle climate change. Without them on board, any efforts by their counterparts in the U.S. and other major economies to slash emissions would merely slow climate change, not halt it. This crucial importance has been clear for decades, informing an approach to climate diplomacy that was centered on U.S.-China cooperation.

This approach is a familiar one to U.S. President-elect Joe Biden. His election nearly coincided with the sixth anniversary of a historic achievement for the Obama-Biden administration: the November day in 2014 when Presidents Barack Obama of the United States and Xi Jinping of China stood side by side and pledged to begin jointly “combating global climate change, one of the greatest threats facing humanity.” This was the first time that a major developed and developing country had agreed to take specific and coordinated steps to limit their contributions to climate change – a breakthrough in international climate diplomacy, which had for decades been hamstrung by the refusal of developing countries to limit their own emissions growth in the absence of more ambitious pledges or financial assistance from developed countries.

At a stroke, Obama and Xi broke this diplomatic logjam, resurrecting hope in talks that had seemed at risk of failure since China helped scuttle an agreement at the 2009 Copenhagen climate conference. This period proved a high-water mark for a cooperative approach to tackling climate change. The U.S. and China launched an alphabet soup’s worth of cooperative clean-tech initiatives on everything from industrial boiler efficiency to green finance. Such full-spectrum engagement, the thinking went, would ultimately cause the interests and priorities of Washington and Beijing to converge – at least on climate and energy, if nothing else.

For a while, it looked like climate change would indeed be a “bright spot” in otherwise strained ties between Washington and Beijing. A year after the Sino-American climate breakthrough, world leaders forged the Paris Agreement, which created a new framework for climate action based, for the first time, on specific national commitments. Unlike in the past, all countries, not just rich ones, were obliged to contribute to addressing climate change, though still to different degrees. Despite gaining unprecedented support from the world’s nations, the U.S. and China were seen as the central players in the Paris Agreement. Washington and Beijing embraced the image of a climate leadership tandem, even formally signing the agreement together in a joint ceremony. Led by the world’s two largest economies and biggest emitters, the Paris Agreement quickly acquired near-talismanic importance for environmentalists and climate activists the world over.

The past five years, though, have made it clear that Paris didn’t quite live up to the promises either of meaningfully reducing emissions or bolstering global cooperation. The world has consistently failed to meet the goals set out in the Paris Agreement in 2015, making deeper emissions cuts in all major economies necessary to avert a climate catastrophe. In 2017, meanwhile, U.S. President Donald Trump announced his intent to withdraw from the Paris Agreement, turning out the lights on the one-time bright spot in Sino-American cooperation. The withdrawal was made official on November 4 of this year.

As it happened, this was just the beginning of a marked shift from cooperation and convergence to competition and rivalry in the China-U.S. relationship. Six years after the landmark China-U.S. climate deal, political and economic tensions have diminished political will in the United States to seek a cooperation-driven relationship with China almost to zero. Few issues can unite progressive Democratic congresswoman Alexandria Ocasio-Cortez and conservative Republican Senator Ted Cruz – except, apparently, opposition to China, whose actions on free speech restrictions and in Hong Kong were the subject of scorching letters signed by both.

In part, this dim view reflects the fact that Beijing seems to increasingly view climate change through a geopolitical lens. Since Trump announced his intent to withdraw from the Paris Agreement, Chinese diplomats have made a point of highlighting Beijing’s climate policies to the United States’ European allies, seemingly in an attempt to drive a wedge between them. China’s massive investments in renewable energy, meanwhile, have become increasingly viewed as a hopelessly distorted attempt to bolster Chinese firms at the expense of their Western rivals – and only after having purloined Western technology. These shifting views, although not as marked, are mirrored in Europe, where officials have branded Beijing a “systemic rival.”

At the same time, the West, spurred by China’s economic rise, has seemingly embraced the idea of competing with other major economies through technological research and development. In a remarkable December 2019 speech, Republican Senator from Florida and former presidential candidate Marco Rubio jettisoned decades of conservative orthodoxy in a few short paragraphs, arguing for abandoning unwavering support for free market principles in order to “invest and compete in the emerging industries of the future, rather than forfeit them to China.” European countries, too, have called for a more coordinated and strategic approach to technology development largely as a response to a perceived economic and geopolitical threat from China. This political-economic shift toward state intervention and industrial policy is currently driven more by digital technologies like 5G than low-carbon ones. Even so, it seems increasingly clear that the most compelling rationale for boosting public investment in areas like battery storage or hydrogen fuels is to help countries compete, not cooperate, more effectively.    

These new geopolitical dynamics have several major implications for international efforts to address climate change. One is that climate policies and pledges like China’s 2060 commitment will increasingly be viewed with skepticism and suspicion they are driven more by political than environmental objectives. The European Union provided a taste of this new dynamic when it responded to China’s carbon pledge by noting warily that “a lot of work remains to be done.” Climate leadership, previously seen as a win-win proposition both for individual countries and the world at large, now looks more like a zero-sum game. Second, governments’ long-standing insistence that tackling climate change and liberalizing trade go hand in hand, enshrined in the 1992 Rio Declaration, looks to be a thing of the past. Growing friction over the terms of trade, intellectual property protections, and related matters mean that countries will be more likely to invest in clean technology research and development for their own firms rather than support liberal trade regimes that would speed the diffusion of clean technologies across the globe. That will make reducing emissions more expensive, at least in the short run. 

However, a competitive approach to climate diplomacy might help scale two big remaining barriers to preventing catastrophic climate change: lingering political opposition from fossil fuel interests, and development of technologies that will not only get the world to carbon-neutral, but carbon-negative. In many major economies, including India and even countries like Poland within the European Union, powerful interests remain opposed to plans to shift to carbon-free sources of power. But the use of financial carrots for technology development rather than regulatory sticks may help to blunt this opposition. In the United States, longtime Senate Majority Leader Mitch McConnell, a Republican who hails from coal-producing Kentucky, has long opposed the use of regulatory sticks to prod climate action, and will be in a position to do so again under a Biden administration if Republicans retain hold of the Senate. Yet having objected to Obama-era climate regulations, which he decried as a “war on coal,” McConnell has also expressed openness to a climate policy based on “American values and American capitalism… through technology and innovation.”

To be sure, the free market alone cannot solve climate change. Many clean technologies will not be practical until a price is put on carbon. But pursuing a technology- and investment-driven approach might nonetheless help advance climate action in major economies while also solving remaining technical challenges to going low- and no-carbon. This approach, combined with carbon pricing, has gained increasing support from the business community, especially in the United States. Its promise is perhaps clearest, though, with respect to the world’s biggest emitter, China, which despite claims to be a climate champion has struggled mightily to kick its addiction to coal.

Kicking China’s Coal Habit

Unlike some of their foreign counterparts, China’s leaders need little convincing of the need to act on climate change. Former top leader Hu Jintao, though reluctant to support strong commitments at the 2009 Copenhagen climate conference, continually emphasized the importance of climate change, warning senior cadres in a 2010 speech that it “affects the survival and development of humanity” and “the fundamental interests of the Chinese people.” Cadres must, Hu stressed, “incorporate the control of emissions into economic and social development plans.” At a time when environmental protection goals were routinely subordinated to economic growth targets, Hu’s emphasis on greenhouse gas emissions was noteworthy. Around the same time, references to “low-carbon development” and a “new economic model” began to signal that China’s leaders viewed clean and renewable energy technologies as important drivers of future economic growth.

Hu’s successor, Xi Jinping, has in many ways made environmental protection, and by extension climate change, a core part of his leadership persona. He has repeatedly claimed a long-standing commitment to environmental protection, including in a letter to university students in which he described concluding as a young man that “harm to nature will eventually hurt mankind.” At the 19th Party Congress, held in 2017, Xi’s work report celebrated “leading international cooperation in response to climate change” and referred several times to “low-carbon development.” It also expressed specific support for the Paris Agreement and for the creation of a national emissions trading system, though the latter has so far failed to meet expectations.  

Xi’s advocacy of international climate cooperation has become a key element of Party propaganda and messaging related to China’s role in the world. A document issued in September 2020 to commemorate the 75th anniversary of China’s successful struggle against Japan in World War II, a core trope in Chinese Communist Party propaganda, proclaimed that “From Moscow to Jakarta, from the Yanqi Lake to the West Lake, from the United Nations Headquarters to the Palais des Nations in Geneva, Chinese leaders’ vision of a shared future for humanity always resonates.” The success of this vision, the document went on to explain, was thanks to China’s “active participation in addressing global challenges such as climate change,” alongside other multilateral initiatives like participation in United Nations peacekeeping, global health, and the Belt and Road Initiative.

At home, though, signals of Beijing’s commitment to climate policy have been more mixed. On the one hand, climate change looms large in the Party’s calculations on core domestic policy priorities like stability maintenance. A major Party-sponsored conference on Tibet held in August 2020 cited the need to “accurately grasp the impact of climate change on the Tibet-Qinghai Plateau” and “proposed methods for protection, restoration, and governance.” In May, the National Development and Reform Commission (NDRC), which oversees many key climate and energy policies, pledged to continue to pursue and enforce energy efficiency, pollution control, and carbon intensity goals. At the National People’s Congress held the same month, meanwhile, Premier Li Keqiang pledged to make “new infrastructure,” including clean technologies like electric vehicles, the focus of China’s post-pandemic economic recovery plan.

But on the other hand, Beijing has signaled that its own efforts to limit emissions growth may have to take a back seat due to pandemic-related economic pressures. Even as it pledged to continue to fight pollution, the NDRC admitted that China would fall short of meeting its target of increasing energy efficiency by 3 percent, a key climate goal. And despite proclaiming a new focus on cleaner technology and infrastructure, moreover, Li likewise announced that the government would prioritize jobs growth over the coming year and would not set a specific energy efficiency improvement target for the first time since 2014.

Perhaps most worryingly from an emissions standpoint, as part of its post-pandemic recovery efforts Beijing approved construction of more coal-fired power plants than in the past two years combined. As former Australian Prime Minister Kevin Rudd has pointed out, if all these plants are built, the world is almost sure to fall short of its Paris Agreement climate targets. Yet this coal boom is happening despite significant overcapacity and sharply reduced profits for energy producers – suggesting that politics, not economics, are driving energy policy.

Indeed, despite issuing a raft of climate-friendly energy policies and plowing billions into renewable energy over the past decade, China has never really given up on coal, the fuel that’s done more than any other to drive up global temperatures. China’s use of coal for power generation never meaningfully budged despite Beijing’s climate pledges, and after a brief drop in the mid-2010s, total coal use appears to have increased every year since 2017. Despite Beijing’s high-level commitments to reduce its reliance on fossil fuels, the coal industry is a major source of employment and growth for rural areas, and the political economy impediments to a phase-out remain formidable. Subsidies and policy support for fossil fuels and emissions-intensive industries in China may well be almost solely responsible for the 0.6 percent increase in global emissions seen in 2019, which otherwise probably would have fallen thanks to declining coal use in the United States and Europe.

Yet even China’s mixed record on domestic climate goals pales beside its discordant role as the leading financier of coal-fired power plants around the globe. Some one-quarter of all coal plants currently under development outside China are at least partly financed by Chinese sources, in addition to tens of billions of dollars’ worth of oil, gas, and other fossil fuel infrastructure projects.

The continued salience of coal in China’s energy sector, as well as its politics and economies, makes it clear just how difficult it will be to achieve carbon neutrality by 2060. Doing so will require phasing out the use of carbon-rich coal and oil almost entirely. However, there is currently no clear alternative to using coal to support energy-intensive heavy industry like steel manufacturing, or to supplanting hydrocarbons for transport applications like aviation, shipping, and trucking. And while China appears on track to achieve “peak” emissions by 2030, it will likely be some time before they begin to actually fall. This means that China, like the rest of the world, will be in need of new technologies to both reduce greenhouse gas emissions and, eventually, recapture them from the atmosphere.

Getting to Carbon Neutral – and Then to Carbon Negative 

An uncomfortable reality in the world’s struggle to confront the climate crisis is that the shift to low- and zero-carbon forms of energy is unfolding at a torrid pace, and yet still too slowly to prevent catastrophic climate change. Solar power in particular has enjoyed near-exponential growth over the past 15 years, and now provides the cheapest electricity on the planet – not just presently, but in all of history. Even so, the world faces a lingering technology gap that will need to be closed in order to slash emissions to near, and eventually below, zero in the decades ahead. This gap has several principal components. First, the world needs a way to compensate for the variability in power produced from most renewable sources like sun and wind. Second, we must find an alternative to oil to power long-distance transport. Third, we need ways to suck carbon dioxide, and possibly other greenhouse gases, out of the atmosphere and trap it in places where it can’t contribute to global warming. There are several candidates to bridge these technology gaps, but China, unsurprisingly, is key to all.

The simplest, and probably cheapest, way to scale these hurdles is to keep burning some fossil fuels but capture and store the resulting carbon dioxide emissions so they don’t enter the atmosphere. This approach, known as Carbon Capture, Utilization, and Storage (CCUS), usually involves diverting carbon dioxide produced at coal-fired power plants or oil refineries directly into underground wells or aquifers where, ideally, it remains indefinitely. CCUS can also be used to remove carbon dioxide from the atmosphere, and is touted by many experts as the only realistic way to fully decarbonize the world economy. Most of the technology behind CCUS is straightforward, but high costs and regulatory hurdles have hobbled its implementation in most places. Except, that is, for China, where CCUS enjoys considerable policy support and where the economics appear to be much more favorable than in other major economies. CCUS will be indispensable if China is to meet its 2060 carbon pledge, and therefore is likely to be a major focus of its innovation, research, and development efforts.

Another key technology might be hydrogen energy. Like petroleum, hydrogen fuel features a high energy density, meaning that it yields a significant quantity of power in relation to the volume of the fuel itself, an important feature for transport applications like aviation and shipping. Hydrogen produced by renewable energy could also help fully decarbonize emissions-intensive industries like steel and concrete production. Alternatively, hydrogen produced from coal combustion could be combined with CCUS, yielding similarly carbon-free fuel.

While governments and private companies in most major economies, notably Europe, support hydrogen energy research, it is an especially appealing technology for China for two reasons. First, China is already by far the world’s largest producer of hydrogen, primarily through coal gasification. Second, hydrogen could help overcome the problem that much of the electricity generated from China’s vast renewable energy infrastructure is effectively wasted because it can’t be stored for when it’s most needed. When excess renewable power is available, it can be used to produce hydrogen, which could then be stored and used when renewable sources can’t meet total energy demand – a backup role currently played by coal-fired power plants.

The fact that China is so central to these and other remaining pieces of the clean energy puzzle should be comforting to Western policymakers determined to confront the climate crisis. But it should also challenge them. If China, thanks to its ambitious carbon pledge, takes the lead in developing and deploying the key technologies needed to get to carbon-neutral, and eventually carbon-negative, the geopolitical and economic costs could be severe. This in turn should motivate decision-makers to invest in zero- and negative-carbon technologies.

But the new geopolitics of climate change, centered more on competition than cooperation, might also help solve other aspects of the climate crisis. Technology, though critical, is no silver bullet; the world will need massive aid programs to help its most marginalized adapt to a changing climate. Even here though, the idea of rival powers vying for influence in fragile regions of the world might present the best hope for wringing these crucial aid dollars out of austerity-minded major economies. The United States’ BUILD Act, perhaps the biggest investment in foreign aid in decades, passed in 2018 with broad bipartisan support – and was justified primarily as a response to China’s growing global influence.

As the world prepares to turn the page on a momentous, and tumultuous, 2020, it has the best chance in years of mounting a global response equal to the scale of the climate crisis. Yet success or failure will depend on fundamentally different dynamics than in the past: This is an era in which climate change is framed more by competition than cooperation and depends more on technological innovation than domestic regulation. Let us hope the outcome, as well as the context, of climate action is different this time around.