- Despite the Paris Climate Agreement, without new global energy steering bodies the world may fail to meet the challenge of preventing catastrophic climate change.
- Although the G20's potential in terms of global energy governance may still remain limited, the G20's recent actions and steering efforts show that the G20 does have a large ability to make progress in addressing some specific global energy issues.
The Group of Twenty (G20) is one of the most effective emerging forum for global economic and financial consultation and cooperation that brings together the world's biggest and emerging economies, representing around 85% of global GDP and 80% of the world's population.
Started in 1999 as a meeting of Finance Ministers and Central Bank Governors in the wake of the Asian financial crisis the G20 held its first Leaders' Summit in 2008, and the group played a key role in responding to the global economic and financial crisis started that year G20 leaders have met ten times on various occasions since then.
Although the Leaders' attention primarily continuing to focus on achieving strong, sustainable and balanced growth, promoting job creation and financial regulations that reduce risks and prevent future financial crises and modernizing international financial architecture, inevitably global political crisis of the day and unalienable components of sustainable growth and prosperity such as energy issues are becoming more central to the platform with growing potential to deliver solutions.
Turkey which held the presidency of G20 for 2015 organized the tenth G20 Leaders Summit in Turkish Riviera, Antalya on 15-16 November 2015. Leaders' Summit was attended by representatives from 26 countries (In addition to original G20 members, with the initiative of the Turkish Presidency, Spain, Azerbaijan, Singapore and the chairs of ASEAN-Malaysia, African Union -Zimbabwe and NEPAD-Senegal)
and seven international organisations (the Financial Stability Board-FSB, the International Labour Organization-ILO, the International Monetary Fund-IMF, the Organization for Economic Co-operation and Development-OECD, the United Nations-UN, the World Bank-WB and the World Trade Organization-WTO and rep.s of the Low-Income Developing Countries-LIDCs). The heads of delegations of the G20 and guest countries and international organizations had bilateral and multilateral meetings on the sidelines of the Summit. For the first time of the groupings' history energy had become one of the key priorities with particular focus on energy sustainability and climate change finance.
Given the severity of the problems, our planet needs new platforms to discuss more on what sort of reforms might be required given the growing importance of new forms of energy and the rapidly changing oil and gas markets. Those skeptical about the G20's role in global energy governance must answer the following question first: Do the existing institutions work well to address global energy problems? The G20 constitutes one of the perfect venue by bringing together advanced and emerging economies and groups such as the BRICS. This grouping is unique by bringing the US, the EU, China and India as well as South Africa, South Korea, Japan, Saudi Arabia and Turkey without which no meaningful dialogue can happen either on climate change or unconventional oil and gas revolution.
Certainly the current international institutions are not well suited to managing it. Why not to give a greater role to the G20? Those confining global energy issues to certain groupings and organizations such as OPEC, OGEC, OECD, IEA or IEF and opposing greater role for G20 must also be prepared to answer what happens if the world fails to create effective energy steering committees to meet the challenge of changing its behavior sufficiently to prevent catastrophic climate change? G20 with its political and economic representation power can certainly help address some of the politically complicated realities around energy geopolitics.
Despite the revolutionary potential of unconventional gas and oil, it has yet to reach emerging markets and some of the G20 member countries such as Turkey, South Korea, South Africa, Brazil, Argentina, Mexico and even China. Conditions for such a revolution requires certain circumstances and know-how. This potential, if coordinated well could achieve sustainable robust growth patterns after the world economic and Euro crisis, and help reach the UN millennium sustainable development goals. Both have been reviewed during 2014 G20 Summit in Brisbane, Australia, and revisited at this year's summit in Antalya, Turkey.
Today, there are over 1.3 billion people who do not have access to electricity or basic reliable energy. Considering the urgent need to take steps to tackle this global challenge, during this year's Presidency, G20 emphasized more the issues of energy access and energy investments. In this context, the grouping studied the reasons behind the high costs of renewable energy investment, and analyzed the ways and means to deploy more public and private resources to fulfill the need for costly energy investments.
Based on these efforts considerable documents, plans, principles are agreed upon and they all will be re-evaluated, improved in the following G20 summits.
Climate Change Finance
There is no doubt that today, climate change is one of the most urgent and the most severe global issue that needs global action and solution.
In preparation for the upcoming 21st annual Conference of Partners (COP21) UN climate change conference in Paris, the UN, the EU and the G20 Presidency worked hard on diplomacy side and urged all parties to overcome their differences for a legally-binding deal. It was proven crucial in success of the COP21 climate change conference gathering which was decisive for the climate change negotiations as the United Nations Framework Convention on Climate Change (UNFCCC) was expected to render an agreement that would define the future of our efforts in this phenomenon.
During Turkey's Presidency, this issue was taken up by the G20 with a particular focus on vital financing aspect and the needs of the Low Income Developing Countries (LIDCs), a dialogue without which any negotiation on the problem or an implementation of an agreement will be premature. G20 Finance Ministers and Central Bank Governors expressed their commitment to promote an enabling environment for LIDCs as they pursue their development agenda and help them to build their institutional capacity. New deliberations for studies to improve the collaboration, dialogue and cooperation between the two groups will continue.
The First G20 Energy Ministers Meeting
Meetings of various G20 ministers (Trade, Foreign Affairs, Labor & Employment, Food & Agriculture, Tourism) are almost a custom, however the first ever G20 Energy Ministers Meeting in the history of the G20 was held on October 2, 2015. The priority attached to sustainable development issues in general and "access to energy" in particular. In line with these priorities, the G20 Energy Ministers also came together with African Energy Ministers and institutional investors to discuss the above-mentioned priorities at a "High-Level Conference on Energy Access in Sub-Saharan Africa" which was held as a precursor of the Ministerial Meeting on October 1, 2015.
On more concrete grounds at the G20 Energy Ministers Meeting, Ministers:
- adopted a Ministerial Communiqué, which constitutes a comprehensive framework for further improving the cooperation based on the G20 Principles on Energy Collaboration.
- adopted the "G20 Energy Access Action Plan: Voluntary Collaboration on Energy Access", the first phase of which focuses on enhancing electricity access in Sub-Saharan Africa where the problem is most acute and the"G20 Toolkit of Voluntary Options for Renewable Energy Deployment", which aims to enhance renewable energy commitments.
- discussed also issues related to inefficient fossil fuel subsidies and market transparency.
- Encouraged and concluded discussions on important documents on energy efficiency such as the "Report on the G20 Energy Efficiency Action Plan: Voluntary Collaboration on Energy Efficiency 2015 Outcomes of Work Streams" and the "Voluntary Energy Efficiency Investment Principles for G20 Participating Countries".
This new and important window of discussion among the world's leading economies provides very important opportunity not to be missed in terms of efforts to find sustainable and effective solution to climate change, smooth transition through unconventional oil and gas revolution and in addressing global energy and environmental challenges such as reliable energy access and developing responsible renewable energy capacity. Ultimately, outcome of these challenges will be fundamental for the future of world economy and finance.
Some useful articles/links and news entries used for this article:
- Van de Graaf, T. and Westphal, K. (2011), "The G8 and G20 as Global Steering Committees for Energy: Opportunities and Constraints", Global Policy, 2, 2011, pp.19-30. doi: 10.1111/j.1758-5899.2011.00121.x ; Van de Graaf, T., The Politics and Institutions of Global Energy Governance, NY, Palgrave Macmillan, 2013, pp.125-147.
- Tajha Chappellet-Lanier, The G20 Sumit after Paris, Nov. 15, 2015 http://www.theatlantic.com/international/archive/2015/11/the-g20-summit-after-paris/416127/
- http://www.irena.org/documentdownloads/Pressrelease/G20_Toolkit.pdf ; https://g20.org/wp-content/uploads/2015/10/Report-on-G20-Deployment-of-Renewable-Energy-2.pdf