On Monday, German Chancellor Angela Merkel announced that the G7 have agreed to phase out the use of fossil fuels by the end of this century.
From this point, the world’s leading economies (including Canada, France, Germany, Italy, Japan, the UK and the USA) will work towards transitioning their electricity generation away from oil and gas and towards renewable and nuclear energy. The BBC has heralded this move as a “seismic shift” that signals “the end of the fossil fuel era that has driven economies since the Industrial Revolution.”
In a 17-page communique, the G7 announced that they will follow the recommendations of the UN’s Intergovernmental Panel on Climate Change (IPCC) and endeavor to reduce greenhouse gas emissions by 40 to 70 percent by 2050 (from 2010 levels).
In November, the IPCC warned that a failure to transition away from fossil fuels in the near-term will increase the likelihood of “severe, pervasive and irreversible impacts” to the environment, including global sea level rise, extreme weather and food shortages.
“Science has spoken,” said UN Secretary-General Ban Ki-moon at the time. “Leaders must act. Time is not on our side.”
Some environmentalists and scientists have criticized Merkel’s announcement, warning that 85 years is too long to wait to eliminate fossil fuels. Climate experts have warned that a 2050 phaseout has a better chance of keeping global warming below two degrees Celsius by the end of this century – an important benchmark set during the 2009 Copenhagen Accord. Yet despite the Accord, world governments are still spending at least $775 billion per year to subsidize the use and production of fossil fuels.
As of now, the G7’s phaseout goals are non-binding and do not include individual emission targets, leaving the mechanics of this worldwide transition up in the air. Even so, today’s announcement will have major implications for the fossil fuel industry, which now faces a future in which its billions of dollars of investments are at risk of becoming “stranded assets.”