Pay Attention to the Other Paris Climate Agreement

Ed. note: This commentary builds on ITIF’s “Global Clean Energy Innovation Index,” which tracks 14 indicators of national contributions to global energy innovation, and “Omission Innovation 2.0,” which aggregates key indicators to the global level.

Beginning next week in Madrid, the latest UN Climate Change Conference seeks to hold nations accountable for the commitments they made in the 2015 Paris climate agreement. Rightly so: that agreement is important.

But it isn’t as important as the other agreement signed at the same place and time. Tragically, this other agreement, called Mission Innovation—a commitment by the world’s major powers to accelerate innovation in emissions-cutting technologies—has been virtually forgotten. Worse, its signatories are not living up to its terms.

It’s time for the world to pay much more attention to the other Paris agreement and to hold nations accountable. Unless they do, and quickly, global hopes of avoiding heat waves far worse than the one that broke the all-time record for Paris last summer (and made July hottest month in history) will be dashed. Promises made in the French capital to cut emissions will amount to little more than hot air unless the world develops technologies that will make the cuts possible at a price businesses and consumers can afford.

Here’s why rapid innovation is so important. First, no realistic solutions have been developed to eliminate emissions from some major sources, including cement and steel production, ship and air transportation, and agriculture. Zero-emissions options exist for other major sources, like electricity generation, surface transportation, and building energy. But without further innovation, these options will remain too expensive or impractical to fully displace entrenched incumbent high-emissions technologies.

Mission Innovation committed nations to tackle these challenges by doubling their investments in public clean energy research, development, and demonstration (RD&D) in a five-year period and cooperating to tackle the most pressing issues involved in developing lower cost clean energy technologies. But new research by the Information Technology and Innovation Foundation shows that most signatory nations are far short of making good on their promises. Clean energy RD&D investments have actually fallen since 2015 across much of Europe, including in France, Italy, the Netherlands, and Scandinavia, as well as in South Korea, while rising a paltry 2-3 percent in Japan and Germany, slower than these nations’ overall economic growth rates.

The gap between talk and action on energy innovation is disturbing. The chair of the most recent meeting of energy ministers disingenuously reported that Mission Innovation was “on track” to meet its five-year target. That is true only in the most legalistic sense: many nations lowballed their spending baselines, so they could easily claim to have doubled them. Honest reporting by the International Energy Agency shows that spending rose just 12 percent in the three years following the accord’s signing—far off track for doubling—and actually fell as a share of GDP.

Ironically, despite all the criticism it has received for announcing its withdrawal from the first Paris agreement, the United States is outperforming most of the world on Mission Innovation. Its $6.8 billion clean energy RD&D budget is larger than the countries ranked second and third (China and Japan) put together, and it has grown nearly 15 percent since the agreement was signed. Moreover, U.S. spending on basic energy science is larger than all the other Mission Innovation nations combined.

These levels were achieved, though, only because Congress, on a bipartisan basis, rejected the Trump administration’s proposed budget cuts. Beyond the budget, the administration’s head-in-the-sand attitude toward climate change has harmed global clean energy innovation, giving diplomatic cover to nations that continue their support for dirty energy. In fact, seven Mission Innovation nations still subsidize fossil fuel consumption, spending seven times as much doing that in 2018 than all Mission Innovation nations together invested in clean energy RD&D, and six still spend 15 percent or more of their energy RD&D budgets improving fossil fuel technologies.

A large industry has emerged to track whether national commitments made in Paris to reduce emissions are being fulfilled. They are not and will not be until the world seriously tackles and then solves its energy innovation challenge. It’s past time to make good on the other Paris agreement.