Why is it important that the G20 addresses energy and climate policies?
In order to be effective, climate policy needs to be global. The G20 account for 85% of global emissions, and are therefore the ideal platform to achieve substantial progress on establishing global mechanisms to implement the Paris Climate Agreement. The global business community is providing innovative products and the technologies to help achieve the ambitious global emission reduction targets. Governments need to undertake actions that will intensify the development, production and deployment of these innovations. This includes working on more effective harmonisation of the various carbon cost policies used around the world and prioritising the most cost effective options to achieve those objectives. It must also include measures to minimise any policy induced relocation of investments so that those countries that move first are not punished for their early actions.
How does the Paris Climate Agreement affect business models?
With the agreed bottom-up approach of the Paris COP21 agreement, different speeds towards low carbon economies will remain, so the current local regulatory frameworks continue to apply. This will provide new chances for business solutions. But in order to avoid carbon and investment leakage in some regions such as the EU, government efforts to meet the global goal should lead to more harmonized approaches and an agreed international carbon price.
How can the B20 contribute to an effective and growth-friendly energy policy?
A harmonised approach for a global carbon price issued by G20 is necessary in order to promote climate protection and to exploit business opportunities. This is essential for the implementation of global measures that would not be economical for individual companies under existing circumstances (e.g. CCS). In order for required measures to be implemented, the global competitive environment needs to be designed in a way to take damages from climate change into account.
Why is global coordination for resource efficiency important?
Resources, from raw-materials and energy to natural resources all have a strong impact on the competitiveness of industrial activities. Businesses have an inherent motivation to increase resource efficiency as this directly improves their bottom line. However, resources are available and used globally, so their use cannot just be regulated on a national level as this would only shift their availability between regions - without any positive impact on their efficient use. Therefore, sustainable resource efficiency policies can only be effective through global coordination (e.g. UN conventions).