Last summer, the German river Rhine, a crucial shipping lane, was on historically low water levels with devastating impacts for inland shipping, industry and tourism as well as for the river’s own ecosystem. Ships got stuck, the riverbed almost dried up and many fish were dying. Something very similar happened around the same time in China, where the water levels at the Yangtse river went so low, that it was causing power shortages in Sichuan und many industries had to reduce or even stop production.
These two rivers, thousands of kilometers away from each other, suffered from the same problems – record temperatures, droughts and low water levels. They are just two examples of how vulnerable we all are to the devastating impacts of the climate crisis. The climate crisis is hitting with ever-greater force and we are witnessing the devastating impacts not just in China and Germany but all over the globe. The floods sweeping a third of the territory of Pakistan left tens of millions of people in need for assistance. The worst droughts in decades in Ethiopia pushed millions of children, women and men into hunger and starvation. The climate crisis is a direct threat to our food security. For example, even as global rice demand is soaring, yields are stagnating. Rising temperatures are withering crops, more frequent floods are destroying them. The climate crisis is a direct threat to human life – but the indirect effects go even further: the climate crisis destabilizes societies, fuels conflicts and disrupts peace and stability.
We are living in a truly decisive time. This decade – meaning the next 7 years – will decide whether we will be able to limit the destructive effects of the climate crisis and stay on the 1.5 degrees pathway or not. This is not my analysis, but an essential take-away from the sixth synthesis report by the IPCC that was published a couple of weeks ago. While I have been reading these reports for the past 20 years this one is particularly alarming. The report says that there’s a “rapidly closing time window for actions to secure a liveable and sustainable future for all. The choices and actions we take now will have impacts for thousands of years”. Let me repeat that: The choices and actions we take now will have impacts for thousands of years.
It is on us, my generation, to take responsibility and make the right decisions and change things for the better – but also on your generation to step up. Our actions and decisions will have consequences for future generations.
The good news is: we have sufficient knowledge, tools and global capital available to tackle the challenges of the climate crisis. It is possible to halve global emissions by 2030 with existing technologies and affordable costs. But we need urgent and transformative action across all sectors and systems and take far-reaching decisions. For this, it is crucial that we understand the current dynamics that are happening around the world and especially the changing relationship between climate policy, energy security and economic prosperity.
Let us take a step back for a moment. Access to energy has always been closely linked to development and growth across all regions of the world. Our economic history of the past 200 years has been shaped profoundly by the access and usage of fossil fuels. The so-called industrial revolution, which started in England in the early 19th century was primarily based on coal and led to unknown industrial growth and production capacity. Oil became a crucial resource in the 20th century, accelerated global production and allowed faster transportation with automobiles and planes.
Now, in the 21st century, a new energy era based on renewable energies and a zero carbon, circular economy is emerging. To be clear, we are still far off-track and currently on a 2.5 – 2.7 degree pathway with all its devastating consequences for life on this planet. But things have started to move. In 2022, according to the IEA, 1.4 trillion USD were invested in clean energy projects. That’s more than ever before and more than was spent on oil and gas projects. Renewables will be the world‘s top electricity source within 3 years. BP now projects that oil and gas demand will peak sooner than it was anticipated only one year ago.
The transformation to a sustainable, circular economy has accelerated not only as a necessity to contain the climate crisis, but because this transformation comes with several benefits:
First, the benefit of security. Let me illustrate that with the example of Germany. On February 24th last year, Russia started its brutal war of aggression against Ukraine. At that time, Germany received more than 50% of its natural gas and more than one third of its energy supply in total from Russia. After it started this war of aggression and used energy as a weapon, everyone understood how deeply interconnected fossil fuel imports, energy security, climate policy and independence are – in Germany and around the world. Today, we are down to zero imports of fossil fuels from Russia. We have been diversifying our imports but our main strategy to enhance our security was to accelerate the just energy transition. Last year, we passed the largest legislative package on renewable energy in our history. Today, almost half of our electricity comes from renewable energies – our target is to achieve 80 percent by 2030. For us the pathway is clear: every solar panel and every wind turbine makes us more resilient and more independent.
But we did not only accelerate our energy transition to become independent from Russia but especially we see the economic benefits. This is our second lesson. Solar and wind energy are cheapest and safest way to produce energy in our world today. Coal plants that are built today will be stranded assets and lose money tomorrow. The world is moving in a more sustainable, climate-friendly direction and the markets, technologies and jobs of the future will be in the circular, green economy. Today in Germany, there are already hundreds of thousands green energy related jobs and last year we exported renewable energy technology worth more than 10 billon USD – and we expect both numbers to grow significantly as we accelerate the energy transition. Germany has proven over the last year that it is possible to have an ambitious climate policy, a strong industrial base and economic prosperity at the same time. Even when we had to replace over a third of our energy supply from Russia and accelerated the energy transition our economy was still growing. And I can say with confidence: Germany is now stronger than we were a year ago.
The third benefit is wellbeing. Burning fossil fuels – and especially coal – harms our planet, pollutes the cities where we live, acidifies the soil where we grow our food, seriously affects our health and destroys the rich and beautiful wildlife of our planet. The energy transition makes the air that our children breathe cleaner when they go to school, it reduces the traffic noises in big cities and therefore the stress levels of its people. The energy transition is about being able to walk through green parks and forests, it’s about better public health and therefore – to put it simply – about a better life. Being a rich in the 21st will not only be measured by numbers like GDP per capita or consumption growth, it will be measured by how clean the air is that we breathe, how liveable the city is we live in, how well the public transportation system works, if there are enough parks, if our electricity in our houses is save, sustainable and affordable.
But if there are so many benefits to the energy transition, why is the world so off-track from our climate goals and why are we moving way too slowly in the direction of a global zero-carbon economy? One overarching reason is that the energy transition is an incredible difficult and complex process. We are talking about energy transition but what we actually mean is a fundamental transformation of our way of life: of our economy, of the way we trade, how we build and heat our houses, how we travel and how we commute to work. Change leads to insecurity and insecurity leads people to hold on to solutions of the past. In our world today, where many crisis overlap: the energy crisis, a fragile food crisis, the worrying debt situation in many countries across the world, the severe impacts of the climate crisis – many decision makers hold on to fossil fuels and look for short term gains without realizing that the solutions from the past no longer work in today’s world. We’ve learned that in the medium- and long term Fossil fuels don’t make you safer and more prosperous. The exact opposite is true: they make you more vulnerable, more insecure and – in the long-run – poorer.
We need people who take bold decisions and I hope, after your graduation, you will become one of them. Being bold means to acknowledge the responsibility of this generation and act to contain the climate crisis. Being bold means working for a liveable and sustainable world for all. Being bold means realizing that we need to phase out fossil fuels while at the same time making sure that the just energy transition creates new opportunities for everyone.
As members of the G20, both of our countries have a responsibility – and a huge self-national interest – to drive forward the zero carbon economy and to lead the world in a greener, more sustainable direction. We all have to do more to contain the climate crisis. Germany recognizes its responsibility to take the lead and that is why we committed ourselves to be climate neutral by 2045. We welcome the announcement by President Xi that China wants to be climate neutral before 2060. One reason for me to come to Beijing was to hear more about China’s plans how it wants to reach this goal. China is already a world leader in E-Mobility and the buildout of renewable energies and I hope that China will continue to boldly drive ahead in these fields as well as show the same level of ambition when it comes to the phase-out of fossil fuels, especially coal.
The first time I visited China was in the late 1990s and since then I came to China every year until recently. And for me it is a great privilege that I was able to follow closely how China developed over the past decades and to see the dynamic and the speed of change with my own eyes and learn from its top experts. What China has achieved over the last 25 years is unparalleled in world history. The economy is now 20 times larger than in the 1990s, China has now by far the largest fast-speed train network in the whole world, hundreds of millions were lifted out of poverty. Today, China is the second largest economy in the world and for many countries the biggest trading partner - including Germany. When you look at the size of Chinas economy and population, its leading role in many technologies, the amount of Chinese investments all around the world, Chinas role in the UN with a permanent seat in the security council and as the biggest contributor to peacekeeping missions, it‘s obvious that China today plays a very different and much more influential role in the world than 25 years ago. And China claims this new role and has every right to do so. President Xi said already in 2017 that it is time for China to - and I quote - “take centre stage in the world”.
With this new role come new responsibilities. There is no greater threat to the future of our world and our wellbeing on this planet than the climate crisis and we have to act now to limit the most devavastating effects. The world is looking to the most influential countries and biggest emitters to take the lead in our common fight against the climate crisis – therefore, the world is looking of course at Europe but it is also increasingly looking at China. China is currently responsible for almost a third of global emissions and has historically - after the US - emitted more CO2 than any other country in the world. Through its success, China has taken central stage in the world, on many issues, including the climate crisis, which brings with it opportunities but also responsibilities.
Taking centre stage means working together with other countries to find solutions for global problems. Because one thing is clear: No country will contain the climate crisis alone but every country will suffer its consequences. This is of course where international cooperation is so essential. The climate crisis is a global problem and therefore we need global solutions. All responsible actors in the world have to come together to find and implement them. Sometimes this collaboration will be multi-lateral, sometimes plurilateral and essentially also bilateral. It is clear to me that bilaterally, Germany and China have a tremendous opportunity to work together to achieve concrete results and to accelerate the energy transition in our own countries but also all across the world. This does not mean that we will always agree on everything, one seldom does in long-term relationships, but are able to focus in on where we together can make a difference.
There are several areas where closer cooperation would be beneficial for both our countries - and others:
The first one is a challenging on – the just transition away from coal: If we want to keep the 1.5 degree limit within reach and mitigate the most devastating consequences of the climate crisis, scientists inform us that we need to stop building new coal-fired power plants and phase-out coal worldwide. Coming from Germany, I’m well aware of how difficult this is. We may have different timeframes, as Germany needs to act earlier but this is a major challenge for all of us. Coal has been the industrial base in many regions in Germany and many jobs and families have depended on the coal industry. Some families have worked in the coal industry for generations. And during my many visits to China I experienced first hand that the situation is similar in China.
When we talk about phasing out coal it is therefore not just about an energy source. It‘s about people, their jobs, their families, their future. It is our responsibility as decision makers to make sure that the social aspects of the energy transition are always put front and center and that there will be new opportunities and jobs in these regions. Germany went through a long, difficult process where all the different stakeholders, workers, companies, politicians and many more were heard and at the end a roadmap to phase out coal was agreed and widely accepted. Now we aim to phase out coal by 2030 - and the Russian attack on Ukraine has not changed anything. On the contrary, it has strengthened our resolve because - as I said before - we are convinced that by phasing out coal and accelerating the build-out of solar and wind we will be stronger and more resilient. Yes, we did need last year and this year to be have coal ready to ensure heat for our citizens through the winter, but that will end next year, and we have set deadlines for phase out, and a set of laws and a high carbon price that will help ensure that. I look forward to learning more while here how China will ensure both its energy and climate security in the future.
The just coal transition is a good example that every country has its unique conditions and has to find its own way for the just energy transition – but at the same time we face similar challenges and we all can benefit from listening and learning from each other. If the experience Germany has gathered in a just transition to phase out coal can be helpful for China, this is an area where we could support each other, recognizing our differences. There is so much at stake all around.
Another area of closer cooperation is around scaling up renewable energy. Germany has a long history in renewables and has learned a great amount, for example, about how create a flexible grid structure. China, as noted, is moving forward on electrifying its mobility sector.
We can intensify our cooperation in these areas, and also consider bringing our success to the global stage, into COP28. The incoming COP President is calling for a tripling of renewable energy generation, and the International Renewable Energy Agency, in its World Energy Transition Report, outlined a plan to get there which includes policy frameworks, financing and building the skilled capacity to implement.
Here, Germany and China both share our commitment to implementing the Paris Agreement, that is because multilateral agreements such as the Framework Convention on Climate Change and the Paris Agreement are the foundation of international cooperation. These agreements embed important principles and ensure that all countries, particularly the most vulnerable, have a seat at the table and a say in the direction the world takes in addressing the climate crisis. We are at a critical crossroads in the Paris Agreement.
The COP28 this year will take place at a decisive moment: 7 years ago the world signed the Paris Agreement and committed itself to the 1.5 degrees C limit. And we have only 7 more years to halve global emissions to keep this limit within sight.
This year, what many have seen as the ‘heart’ of the Paris Agreement is going to be negotiated – the Global Stocktake. It was clear to all of us in Paris, that the approach we decided upon – a globally binding agreement with rules combined with nationally determined contributions – had a risk. Although it is an inclusive agreement, and each country can decide itself how much it will commit to reduce its GHGs and increase its ambition to achieve the net zero goal, which builds national support, it was never clear that those contributions would add up to be enough to keep the earth below a certain temperature threshold. Therefore, a ‘ratchet’ mechanism was included, a moment when we assessed whether all we are doing – our best efforts so far – is adequate or whether every country, particularly the G20, need to do more. That moment is now upon us. The IPCC has just informed us that the world is not on track to meet any of the Paris goals: mitigation, adaptation and finance.
It is therefore clear that we need to be more ambitious. This is of course in our own national interest for we must avoid even more devastating consequences for our countries and the most vulnerable countries and people. It is also essential for the credibility and viability of the Paris Agreement, for if its heart, the ratchet, the Global Stocktake, does not result in greater ambition, a major component of the Agreement, that has held it together, will have failed. This we must avoid, for international cooperation on climate change is not only a ‘nice to have’, it is essential for all of us.
Thus COP28 needs, as a response to the Global Stocktake, to decide on a Transformational Roadmap, a modernisation of our economies, to close the gap to keeping the 1.5 degree goal in sight. The IPCC has provided the basis for this roadmap.
Of course each of us needs to update our NDCs this year, or at least strengthen the targets within our NDCs, as we agreed in Glasgow – Europe is now assessing what it can do, because through our Fit for 55 legislation it is clear that the target of at least 55% is likely to be overachieved. Perhaps this could be something China and Europe could do in close cooperation, outlining how our implementation policies and measures have enabled us to overachieve our targets.
Through such different forms of collaboration China and Europe could become the motor of the decarbonisation worldwide.
But we cannot stop here.
We also need to show more solidarity. There are many terrible sides to the climate crisis, but one of the most distressing is that it is hitting hardest those countries that are least responsible for it. The COP27-decision for new L&D-funding arrangements, was a historic success for more climate justice and a strong signal of international solidarity with the most vulnerable. As G20 countries and big emitters it is the responsibility of both our countries to ensure a swift operationalization of the funding arrangements, show solidarity with the most vulnerable countries and help them and their citizens to deal with the impacts of the climate crisis. International cooperation through quickly implementing the LnD decision is essential for trust and for lives. Let us make sure each of our delegations contribute to a transformational outcome at the COP, one which will create the system needed for the decades of impacts yet to come.
Many countries around the world find themselves in a vicious circle. High debt levels and the impacts of the climate crisis mutually reinforce each other and many vulnerable countries don’t have enough money to invest in climate measures. We need to talk about how we can make sure that enough money – public and private – flows in the right direction, makes the world more sustainable and climate resilient and drives forward the zero carbon economy. China as major investor and lender worldwide plays a crucial role and we need to work together to create more space to breathe for those countries who need it the most.
This is a decisive moment in history and – as I said in the beginning – the choices and actions we take now will have impacts for thousands of years. Our children and grandchildren will ask us what we did and what actions we took when it was still possible to contain the climate crisis. We still have the chance to build a world that is more secure, healthier and more prosperous.
Let’s work together to build this new world and to drive the just energy transition forward!