Scheduled Collapse: Who is Blocking the Transition to Net Zero and Why
[This is a brief introduction to my new book. The book builds on my 2021 book, Planet Zero Carbon: A Policy Playbook for the Energy Transition, and continues the theme that getting to net zero is a priority, and that technically, there is not much standing in the way. However, politically the pathway is far more challenging, as special interests stand to lose considerably by the approaching shift away from fossil fuels — mostly to renewables and hydrogen]
“The only existential threat humanity faces even more frightening than a nuclear war is global warming going above 1.5 degrees in the next 20–10 years”
US President Joe Biden
It’s been recognised for some time by climate scientists, the climate-aware public, and increasingly by policymakers that runaway climate change poses an ‘existential threat’. The fact is now widely accepted and there is consensus: if climate change exceeds safe limits and various thresholds or tipping points are reached, we may lose the ability to contain an escalating rise in temperature leading to the collapse of ecosystems, the potential collapse of societies, and even the spectre of civilisational collapse. If sustained climate impacts mean that the global economy is unable to support the many functions we rely on today, for example the financial system, the insurance industry, government services and social protections, then this is what we are looking at. Understood over the long term, after these functions start to erode much of the global north could be brought to a level similar to developing countries. But if runaway warming occurs, and we approach a level where large parts of the planet are unliveable, then conflicts, widespread water and food shortages, resource constraints and other problems compound, and the situation then spirals out of control. At this point, cities bake, lawlessness is rife, and governments are reduced to militias — a tragic situation that may not become possible to fix. The predictable life expected by much of the developed world falls apart, as heatwave after heatwave reduce continents to scrubland and desert, and the majority of the planet’s biodiversity become extinct.
This may seem extreme, but unfortunately, it is becoming obvious that having already reached 1.5°C of warming in 2023, tipping points are in the process of being met. We can see that the main source of scientific data that most climate system modelling has up to now depended on has been recognised as a poor guide to potential and expected future risks. The models are simply too conservative to provide anything like what is now being forecast, as we compare future warming to the current situation. As I discuss later in the book, the reason for this is because the scenarios being modelled are designed with guidance from economists with ties to the financial industry and elsewhere, who have watered down and underplayed the various risks, including tipping points, that we are very likely to encounter as the planet warms. For example, as referenced in a recent Carbon Tracker report, one IPCC model presents an incredibly low estimate of 10% GDP loss at 6°C of warming. Similar estimates are echoed by most climate scenarios used by governmental and financial planning authorities, and nearly always originate from IPCC modelling. This modelling uses outdated assumptions and has been found to only support the climate-averse investment policies of financiers who would not be able to continue existing investment strategies without high level endorsement from the climate science data that risks were minimal. As is becoming impossible to ignore, these risks are not at all minimal and can now be seen to represent a catastrophic threat to functioning economies, most likely somewhere in the region of 10–20% of GDP by 2050, and 50–65% by 2070, according to reinsurer Swiss Re, the UK Institute of Actuaries and others, who require extremely accurate predictions in order to determine insurance costs and liabilities. As the author and economist Umair Haque argues, at this level of GDP loss it would be impossible to effectively rein in escalating temperatures, and complete civilisational collapse becomes a very genuine possibility.
Understanding this, a drastic reappraisal of both IPCC modelling data, and potentially the entire system of IPCC governance and oversight may become unavoidable — the figures just don’t add up. It has become obvious that by ignoring the glaring reality of catastrophic risk, IPCC data has been used to continue business as usual investment policies that have the potential to massively destabilise the global economy. As I will argue, and as others are already callng for, a reform of the IPCC is now long overdue. Because the role of the IPCC has become so vital, a reform of the IPCC could have very positive effects such as expediting the reworking of many core economic considerations — energy investment, financial regulation and government planning — all key to a functioning global economy.
The problem that is becoming obvious is that the pretence of a ‘mild’ or ‘unremarkable’ progression to 3°C and above is entirely at odds with many previously held assumptions including GDP, financial risk, economic viability and social stability. Many have seen this moment coming, however we now stand at a crossroads where governments will either need to act with force or risk economies being obliged to make much more drastic changes further down the line.
This is politically unpopular, and it remains to be seen how governments will act, or how much further regulation the financial industry is ready to take on. What is clear however, is that we are now living in the age of catastrophic climate risk, and it is right in front of us — not in 100 years but within decades, and various ‘points of no return’ are becoming impossible to avoid. Either economy-wide changes are implemented, or the system continues on its course and those profiting from our impending doom are allowed to do so with impunity.
While the news is obviously grim, I should explain this book is not meant to be entirely pessimistic. The energy transition is truly underway, and many components of the overall shift to a zero emissions economy will be inevitable. Renewable power is nearly always cheaper than fossil-based electricity generation, new batteries will offset much of the oil demand stemming from passenger vehicles, and various innovations such as lower-cost heat pumps will enable further electrification. Furthermore, the major change to our energy system is the commercialisation of hydrogen technologies in all sectors; from gas networks to heavy industries to trucks, power stations, aviation and more. Hydrogen will truly enable the transition to accelerate, with low cost, diverse production routes and global availability all strengthening hydrogen’s role as the second primary energy carrier after electricity. The main points outlined in my first book, Planet Zero Carbon, have been proven correct: the hugely important role of policy within the energy transition, rather than allowing the free market to guide our economies to net zero; and also the importance of hydrogen in achieving decarbonisation goals. The comprehensive and much applauded Inflation Reduction Act (IRA) and Bipartisan Infrastructure Law in the US marked a turning point in climate-related US policy planning, away from the ‘light touch’ attitude that has been a hallmark of US policy for decades; and Ursula Von Der Leyen’s extensive Green Deal initiative, followed by the REPowerEU strategy, Hydrogen Strategy, Hydrogen and Decarbonised Gas Market Package and others have all proven that focused policy is the way forward. With regards to hydrogen specifically, we can see how hydrogen has now rapidly adopted a central role in policy planning on both sides of the Atlantic, as governments race to replace fossil fuels with clean burning hydrogen in a range of industries and sectors from gas networks to trucks and steel. Truly, the age of hydrogen has arrived, representing an ideal replacement for fossil fuels in nearly all sectors.
However, despite all this optimism, the path forward is still extremely perilous — governments have acted much too late and emissions continue going upwards — we are nowhere near achieving the 50% cut in global emissions by 2030 to avoid a ‘well below 2°C’ result necessary to avoid catastrophe. As this book explains in detail, a great number of barriers exist to even achieving net zero at all, let alone keeping temperatures within a reasonable threshold before 2050. The real challenge will be to initiate the type of systemic changes necessary throughout every aspect of the energy system, transport system and economy before the onset of progressively worse climate impacts makes a realistic net zero goal impossible, as economic or supply chain difficulties could pose insurmountable obstacles for many nations, even in the Global North. If the many barriers we now face are not overcome, the limited timeframe within which the global economy can effectively operate may mean that efforts to decarbonise become ineffective. Beyond such a point, humanity may start ‘giving up’, and simply allowing fate to take its course — a horrifying prospect that any scientist and observer of ongoing events should condemn outright; but a prospect that we should at least be aware of to accurately gage the difficulty of the task ahead.
Nowhere on earth are our leadership taking the climate crisis as seriously and as they should, despite their best efforts to date. But then they must follow the wishes and priorities set out by their electorate and are in most cases unable to undertake the kind of dramatic action that some would point to as being vital, as they would quickly lose their seats of office and the process would be self-defeating. And in any case, many leaders and government officials have probably already read the latest IPCC data which shows that 2–5% of GDP might be lost by 2100, even in a ‘hot house earth’ scenario, and therefore concluded that no real necessity exists to take drastic action; we are many decades from serious consequences and solid foundations for change are already being laid.
The problem with this line of thinking unfortunately is that the IPCC reports have so far been found to be not just ‘out by a few percentage points’, but thoroughly not fit for purpose — a worst case scenario puts the entire planet at a point of almost guaranteed systemic collapse in only 50 years time. Reports by reinsurer Swiss Re, insurance leader AXA and actuarial institutes keep stating: climate risk is being very seriously underestimated by mainstream scenarios such those produced by the IPCC, central banking models like the NGFS and others. Swiss Re has underlined the need for a reassessment of these mainstream models, as they see a very real risk of 18% GDP loss by 2050, which would be arrived at via current policies bringing us to 2–2.6°C by mid-century; and even today we are not even reaching the targets set. Where the IPCC consider that 2°C might be reached in the ‘early 70s’ under a modest warming pathway, we must ba aware that 2°C has already been briefly touched in 2024, underlined by a possible 3.2°C by 2050 being Swiss Re’s worst case mid-century scenario. Beyond this, Swiss Re and AXA have stated unequivocally that a 4°C world is ‘uninsurable’. As the UK Institute and Faculty of Actuaries have also stated
“Without insurance, investment, finance, business slow to a halt — we will no longer have an economy. Governments will no longer have a tax base from which to deliver vital services or repay coupons on gilts.”
We must also accept that this potential 18% GDP loss (in only 25 years) would not only be permanent, but it would be just the start of an exponentially worsening economic outlook; essentially, the start of a logistic S-curve — fuelled by cascading tipping points — that lead ever closer to permanent collapse. If the point of 50% GDP loss is reached by 2070, then it is not long before complete civilisational collapse is inevitable. So if the economy continues its dependence on fossil energy consumption, financed by a cynical banking community, and effective structural change continues to be blocked and delayed by lobbyists at every opportunity, then this is the outcome we are now signing up for.
Because the finance industry is writing its own rulebook, the entire system continues to believe its own fiction: that climate impacts will be minimal, and that for the rich at least, there is hardly a thing to worry about. Nothing, however, could be further from the truth. The dangers are exceptionally high, and the systematic reform of vital institutions such as the IPCC has been called for but has not yet been undertaken. We are still existing in a world of half-truths, where the financiers, investment fund managers and corporate elites believe that very little stands in their way — if things do go disastrously wrong, then they can avoid any responsibility and still escape with property assets and wealth, while the other half of the world is continually flooded, burned or levelled by storms, soon becoming unsurvivable as temperatures escalate.
The reality is that much of the future remains deeply uncertain, and a number of outcomes are potentially possible. But we know things are unlikely to get significantly better of their own accord, and we are not yet embarking on a course that will steer us broadly clear of the risks that lie ahead — realistically, we are heading directly towards these risks, and the sheer scale of change required is not translating into action fast enough, even in Europe, where knowledge of unfolding climate disaster is mostly robust. Instead, what the general outlook seems to be is that the talk is being talked, but on a deeper level, the commitment is not there. Fossil energy companies are still in the driving seat, and the technical realities of what a realistic transition means are usually swept under the carpet in favour of an eye-catching statistic or fashionable status symbol — flashy electric cars and heat pump technology to heat homes are as far as many commentaries go regarding the goal of net zero, and the trickier subjects of industry or energy storage to replace natural gas are left on the sidelines. And throughout this half-make-believe net-zero journey, the narrative is constantly shaped by those with specific interests, often negating real progress put forward by policymakers. It does very much seem at times that with such clashing opinions, actually achieving net zero may not even be physically possible. And so the question again presents itself: is collapse simply being scheduled, as the corporate-funded rich plan to make their escape?
