Page 6 - MEOG Week 14 2022

MEOG OPINION MEOG

Report: rich countries must cut

output to ensure fair transition

TRANSITION RICH countries must reduce oil and gas out- gas. It quantifies how much future production
put by 74% by 2030 and fully by 2034 in order is consistent with the Paris climate targets and
to keep the world on track for 1.5°C and give what this implies for the 88 countries responsible
poorer oil-reliant countries longer to replace for 99.97% of all oil and gas supply.
their income from fossil fuel production. It sets viable phase-out pathways for five dif-
A new report from the University of Man- ferent groups of countries based on their differ-
chester commissioned by the International Insti- ing capacities to make a rapid and just transition
tute for Sustainable Development (IISD) warned away from fossil fuels. For a 50% chance of limit-
that in order to pursue a fair transition, which ing the global temperature rise to 1.5°C different
would minimise the economic impact of ending countries should meet different targets.
oil production on the world’s poorer producers, The 19 highest-capacity countries, with aver-
different phase-out dates for wealthier producers age non-oil GDP per person (GDP/capita) of
were needed. over $50,000, must end production by 2034, with
Poorer nations should be given until 2050 a 74% cut by 2030. This group produces 35% of
to end production but will also need significant global oil and gas and includes the US, UK, Nor-
financial support to transition their economies, way, Canada, Australia and the UAE.
said the report, written by Professor Kevin The 14 high-capacity countries, with average
Anderson, a leading researcher at the Tyndall non-oil GDP/capita of nearly $28,000, must end
Centre for Climate Change Research, and Dr production by 2039, with a 43% cut by 2030.
Dan Calverley. They produce 30% of global oil and gas and
The richest countries, which produce over a include Saudi Arabia, Kuwait and Kazakhstan.
third of the world’s oil and gas, must cut output The 11 medium-capacity countries, with
by 74% by 2030; the poorest, which supply just average non-oil GDP/capita of $17,000, must
one ninth of global demand, must cut back by end production by 2043, with a 28% cut by 2030.
14%. This means that there is no room for any They produce 11% of global oil and gas and
country to raise production, with all having to include China, Brazil and Mexico.
make significant cuts this decade. The 19 low-capacity countries, with average
“Responding to the ongoing climate emer- non-oil GDP/capita of$10,000, must end pro-
gency requires a rapid shift away from a fossil duction by 2045, with an 18% cut by 2030. They
fuel economy, but this must be done fairly. There produce 13% of global oil and gas and include
are huge differences in the ability of countries to Indonesia, Iran and Egypt.
end oil and gas production, while maintaining Lastly, the 25 lowest-capacity countries, with
vibrant economies and delivering a just transi- average non-oil GDP/capita of $3,600, must end
tion for their citizens,” said Anderson. production by 2050 with a 14% cut by 2030. They
The report noted that some poorer nations produce 11% of global oil and gas and include
are so reliant on fossil fuel revenues that rap- Iraq, Libya, Angola and South Sudan.
idly removing this income could threaten their “There is very little room for manoeuvre if we
political stability. Countries like South Sudan, want to limit warming to 1.5°C. Although this
Republic of Congo, and Gabon, despite being schedule gives poorer countries longer to phase
small producers, have little economic revenue out oil and gas production, they will be hit hard
apart from oil and gas production. by the loss of income. An equitable transition
By contrast, it observes: “Wealthy nations that will require substantial levels of financial assis-
are major producers typically remain wealthy tance for poorer producers, so they can meet
even once the oil and gas revenue is removed.” their development needs while they switch to
Oil and gas revenue contribute 8% to US GDP, low-carbon economies and deal with growing
but without it, the country’s GDP per head climate impacts,” said Calverley The report also
would still be around $60,000 – the second-high- offers a more ambitious scenario with a 67%
est globally. When countries signed the UN Paris chance of meeting 1.5°C. This would require the
Agreement, they agreed that wealthy nations richest countries to end oil and gas production
should take bigger and faster steps to decarbon- by 2031 and the poorest by 2042.
ise their economies and also provide financial In a less ambitious scenario, with a 50%
support to help poorer countries move away chance of meeting 1.7°C – reflecting “well below
from fossil fuels. This principle has been applied 2 degrees” – the richest countries would have to
to coal power generation, with the UN calling on halve oil and gas production by 2035 and end
wealthy OECD countries to phase out coal use it by 2045. The poorest countries would have
by 2030, and the rest of the world by 2040. until 2062 to phase out all production, but there
The report, Phaseout Pathways for Fossil Fuel would still be no room for additional oil and gas
Production, applies similar principles to oil and production.™

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