In 2023, the global community intensified its efforts towards achieving carbon neutrality and addressing climate change, witnessing several impactful events. Research Institute of Carbon Neutrality, Shanghai Jiao Tong University compiled the Top 10 Events (in chronological order) in the field of global carbon neutrality and climate change response for 2023, to share with readers these significant moments that document the ongoing ambition and collective efforts of human society.
1 European Union (EU) strongly supports green industries, and triggers US–EU “Subsidy Race”
On March 16, 2023, the EU unveiled the cornerstones of the Green Deal Industry Plan—the Net Zero Industry Act and the European Critical Raw Materials Act. These initiatives aim to accelerate the establishment of a competitive zero-carbon industry key materials and product supply chains within the EU through financial and policy support. The Net Zero Industry Act targets the Union’s overall strategic net-zero technologies manufacturing capacity approaches or reaches at least 40% of the Union’s deployment needs by 2030. These acts are perceived as the EU’s response to the US Inflation Reduction Act.
The subsidy policies of the US and EU to strengthen local strategic net-zero technology development will intensify the competition for global leadership in the green industry, reshaping global supply chain dynamics, and triggering a new round of global green competition.
2 Intergovernmental Panel on Climate Change (IPCC) releases the Sixth Assessment Report, emphasizing human activities as unequivocally causes of global warming
On March 20, 2023, the IPCC released the synthesis report for the Sixth Assessment Report (IPCC AR6 SYR)—“Climate Change 2023”. The report emphasizes that human activities have unequivocally caused global warming. Human-caused climate change is already affecting many weather and climate extremes in every region across the globe. This has led to widespread adverse impacts and related losses and damages to nature and people, and exacerbated existing inequalities. The report stressed the urgency of immediate action, calling for more ambitious measures to address climate change.
This marked the first time, from 1990 to 2023, that the IPCC unequivocally asserts that human activities dominate climate change, providing authoritative scientific evidence for a global consensus on climate change response.
3 EU reaches milestone agreement, banning on new fossil fuel car sales from 2035
On March 28, 2023, the European Parliament and the Council adopted a plan to ban the sale of new petrol and diesel cars by 2035 which is complemented by a wider set of measures proposed as part of the “Fit for 55” package. The regulation allows the continued sale of new vehicles using renewable synthetic fuels (e-fuels). The law specifies that the CO2 emissions of new passenger cars registered in the EU would have to be 55% lower by 2030, and the emissions of new vans registered in the EU would have to be 50% lower, compared with the CO2 emission targets application in 2021. By 2035, CO2 emissions of new passenger cars and vans would have to be reduced by 100%, i.e., all new vehicles would have zero emissions.
The phase-out of traditional fuel vehicles in the EU will bring significant changes to consumer behavior and the automotive industry, marking a crucial aspect of systemic transformation under carbon neutrality and presenting unprecedented challenges and opportunities for the global automotive industry.
4 EU passes Historic Carbon Market Reform Act, officially implementing carbon border adjustment mechanism
On April 25, 2023, the European Council approved several legislative proposals under the “Fit for 55” package, involving the EU Emissions Trading System (EU ETS), fuel EU maritime, Refuel EU Aviation, Carbon Border Adjustment Mechanism (CBAM), and the Social Climate Fund. It is hailed as the largest carbon market reform in EU history. Adhering to the Polluter Pays Principle, the EU plans to gradually reduce free carbon emission allowances to zero between 2026 and 2034. CBAM, implemented from October 1, 2023, imposes additional tariffs on imported goods to account for their implicit carbon emissions, preventing carbon leakage.
EU ETS and CBAM serve as a double-edged sword for EU climate action, pressuring emitters to reduce greenhouse gas emissions and fostering innovation in green technologies. However, they may also impact fairness in international trade, potentially affecting the fair and just transition.
5 Shipping industry embarks on a new chapter of maritime decarbonization, accelerating entry into the low-carbon/zero-carbon era
On May 16, 2023, the EU announced an amendment regulation to extend EU ETS to maritime transport starting from 2024. Ship owners will need to purchase EU allowances (EUAs) to cover half of the greenhouse gas emissions for applicable ships’ voyages from/to EU, Norway, and Iceland ports and all emissions while sailing and docking within the European Economic Area. On July 7, 2023, the International Maritime Organization (IMO) at the Marine Environment Protection Committee 80 (MEPC 80) adopted the 2023 IMO Strategy on Reduction of GHG Emissions from Ships, setting targets to reduce CO2 emissions per transport work, as an average across international shipping, by at least 40% by 2030, compared to 2008, committing to uptake of zero or near-zero greenhouse gas (GHG) emission technologies, fuels and/or energy sources, and to peak GHG emissions from international shipping as soon as possible and to reach net-zero GHG emissions by or around, i.e., close to 2050. On September 22, 2023, the EU announced the Fuel EU Maritime Act, aiming to gradually reduce the GHG emission intensity of the shipping industry’s fuels.
Stringent carbon emission regulations will bring significant changes to the international shipping industry, driving the rapid development and application of low-carbon fuel technologies. Green hydrogen-based fuels are emerging as the optimal solution for the shipping industry to achieve emission reduction and lower carbon costs.
6 China and the US collaborate again, significantly impacting global climate governance
Zhenhua Xie, China’s Special Envoy for Climate Change and John Kerry, US Special Presidential Envoy for Climate held talks in Beijing from July 16 to 19 and at Sunnylands, California from November 4 to 7, 2023. On November 15, the China–US Summit at Filoli Estate in San Francisco was held. Both countries expressed the commitment to jointly promote the success of the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP28) and decided to operationalize the Working Group on Enhancing Climate Action in the 2020s to expedite concrete climate actions. The Sunnylands Statement on Enhancing Cooperation to Address the Climate Crisis was made public between China and the US, reflecting various agreements on climate change response.
As the two largest GHG emitters globally, China and the US maintained close communication and cooperation in addressing climate change issues in 2023, significantly and positively influencing global climate governance.
7 China Certified Emission Reduction (CCER) market one step closer to relaunch, facilitating broad public participation in carbon emission reduction
On October 19, 2023, the Ministry of Ecology and Environment and the State Administration for Market Regulation of China jointly released the regulation Trial Measures for the Administration of Voluntary Greenhouse Gas Emission Trading, specifying the establishment of a unified national voluntary GHG emission trading institution and trading system. This ensures centralized and unified trading and settlement of the CCER. It marked a significant progress toward relaunching the CCER program. On October 24, 2023, the Ministry publicized the methodologies that would be used to quantify net emission reductions or removals for four types of projects: forestation, grid-connected solar thermal power generation, grid-connected offshore wind power generation, and mangrove revegetation, serving as the basis for the approval, implementation, and verification of voluntary emission reduction projects.
As a useful complement to China’s carbon trading market, CCER utilizes market mechanisms to reduce GHG emissions, providing economic incentives to stimulate broad participation in carbon reduction. The relaunching of CCER will hold significant importance.
8 COP28 reached UAE consensus, seeking consensus amid disputes on climate change
From November 30 to December 13, 2023, the COP28 was held in Dubai, UAE. The conference conducted the first Global Stock takes that were agreed upon in the Paris Agreement, with participating parties outlining renewable energy development and energy efficiency goals. They eventually reached a consensus on a “historic agreement” calling for a transition away from fossil fuels, seen as the beginning of the end for fossil fuels. On the opening day, the operationalization of the Loss and Damage Fund was established to support vulnerable countries in bearing the brunt of climate disasters. The participating parties also reached an agreement on global adaptation goals and their framework. Several oil and gas companies committed to methane emission reductions by signing pledges, aiming for an 80%–90% reduction in methane intensity from oil and gas production by 2030.
The outcomes of COP28 demonstrate the collective efforts of the international community in addressing climate change, particularly emphasizing that multilateralism is a realistic path to constructing a fair, equitable, and mutually beneficial global climate governance system.
9 The hottest year in recorded human history urges global collaboration in urgent climate change response
On November 30, 2023, the World Meteorological Organization (WMO) released the provisional State of the Global Climate 2023 Report on the opening day of COP28, confirming that 2023 was set to be the warmest year in recorded human history. China’s National Climate Center reported that June to October 2023 was the warmest period globally since 1850.
Escalating global heatwaves resulting in extreme weather events and secondary disasters pose a severe threat to human society. Urgent collaborative efforts worldwide are imperative to address climate change.
10 China’s new energy industry leads globally, contributing the “Chinese Approach” to global energy transition
On December 1, 2023, at the World Climate Action Summit, Vice-Premier Xuexiang Ding, emphasized China’s vigorous promotion of green development. China’s share of non-fossil energy generation capacity has increased to 50.9%, supplying 50% of global wind power and 80% of photovoltaic equipment. In 2023, China’s total installed capacity of renewable energy exceeded 1.3×109 and 1.4×109 kW, reaching 1.45×109 kW, which surpassed thermal power installed capacity and accounted for more than 50% of the national total for the first time in history. Renewable energy generation reached 3×1010 kWh, accounting for approximately one-third of the total societal electricity consumption, emerging as a new force in ensuring power supply. According to the International Energy Agency (IEA) report, half of the global increase in renewable energy capacity from 2019 to the present occurred in China. Additionally, China is the leading supplier of clean energy technology globally.
China’s rapid development of new energy under the “Dual Carbon” goals has significantly contributed to the global energy transition, enhancing the international competitiveness of the new energy technology and industry. It has provided a Chinese solution and demonstrated China’s strength in the global energy landscape.
PDF
(248KB)
