Cutting carbon dioxide emissions while building a sustainable future requires urgent and decisive action to separate economic prosperity and energy access from carbon dioxide emissions, according to a report by UN Trade and Development (UNCTAD).

Per capita carbon dioxide emissions by developed countries remain more than twice as high as those in the developing world. Emissions are mainly generated by developed and middle-income developing countries.

Poorer economies contribute little to the global total. For example, least developed countries account for less than 4 per cent, yet face greater risks from climate change and related disasters.

Cutting carbon dioxide emissions while building a sustainable future requires urgent and decisive action to separate economic prosperity and energy access from carbon dioxide emissions, according to a UNCTAD report.
Progress towards renewable energy access and UN Sustainable Development Goal 7 has stalled for the first time in over a decade, the UN organisation said.

The curve is not bending fast enough, UNCTAD noted in a release.

Expanding countries’ capacities to produce renewable energy reduces their dependence on fossil fuels and can significantly lower carbon dioxide emissions.

Additionally, renewable energy technologies and their off-grid and mini-grid solutions could bring power to millions of people living without electricity—a key enabler of development and economic growth.

Unfortunately, progress towards renewable energy access and UN Sustainable Development Goal (SDG) 7 has stalled for the first time in over a decade, UNCTAD said. In 2022, 685 million people still lacked access to electricity, even though the vast majority of them live in areas with abundant renewable energy resources.

Between 2020 and 2022, the top five exporters of products used in solar and wind energy value chains supplied 40 per cent of global exports. This concentration is particularly high for intermediate goods, such as polysilicon wafers for solar cells and wind turbine rotors, whose production is highly energy and capital-intensive.

Meanwhile, most developing countries are slipping into historical trade patterns. While China has emerged as a leading producer and exporter of renewable energy technologies, most developing countries remain net exporters of raw materials.

However, they are net importers of manufactured goods for solar and wind energy technologies missing out on valuable opportunities for sustainable industrialisation, UNCTAD observed.

High trade policy costs also limit the opportunities for developing countries. The UNCTAD Powering Trade report shows that current trade policies are often inconsistent with the global goals for the energy transition, universal energy access and sustainable development.

Particularly for developing countries, setting the right trade policy is a delicate balancing act, as tariffs are also an important revenue source. Average tariffs on goods used to produce solar and wind energy technologies range from 2.5 per cent in Asia and Oceania to 7.1 per cent in Africa, with non-tariff measures further increasing trade costs, it said.

The UNCTAD report highlights the potential to strengthen regional integration in the global South by tackling tariffs and non-tariff measures.

Reducing intra-regional tariffs and compliance costs associated with non-tariff measures could enable economies of scale, promote investment and enhance South-South trade. Lowering import costs for intermediate goods would also help developing countries enter solar and wind energy value chains at the assembly stage, it noted.

Reversing the trajectory of carbon dioxide emissions and building a sustainable future requires urgent and decisive action to separate economic prosperity and energy access from such emissions, it noted.

Fine-tuning trade policies to reflect the realities of the climate emergency can unlock the full potential of renewable energy, driving sustainable and inclusive growth, the report added.

Fibre2Fashion News Desk (DS)