Rajan Wilcox
The world is currently on a trajectory to exceed the Paris Agreement target of limiting global warming to 2°C or 1.5°C above pre-industrial levels. To meet these targets, no new fossil fuel infrastructure can be built, and some existing power plants will need to be shut down early. This is because every expansion of fossil fuel infrastructure deepens our dependence on these fuels and creates additional barriers to change, known as carbon lock-in or infrastructure lock-in. Despite this, many new power plants are under construction or planned, and banks continue to invest heavily in fossil fuels. To transition to clean energy, it is crucial to stop new fossil fuel projects and retire old plants and factories.
| Characteristics | Values |
|---|---|
| Climate change goals | Building more fossil fuel infrastructure will make it difficult to meet climate change goals, such as the Paris Agreement targets of limiting warming to 1.5°C or 2°C |
| Carbon emissions | New fossil fuel infrastructure will increase carbon emissions and make it harder to transition to clean energy |
| Economic stability | Continuing investments in fossil fuel infrastructure could threaten global economic stability |
| Indigenous rights | Fossil fuel infrastructure projects can violate Indigenous rights and destroy sacred habitats |
| Energy decisions | Fossil fuel companies are incentivized to recover their investments and continue profiting from projects, which can create "infrastructure lock-in" |
| Financial backing | Fossil fuel industries rely on financial backing from banks and insurance companies to expand their projects |
| Demand | Fossil fuel infrastructure induces its own demand, deepening our dependence on these fuels and creating barriers to change |
| Alternatives | Redirecting investments from fossil fuels to sustainable alternatives can lead to a new energy future |
| Government action | Governments can play a crucial role in banning new fossil fuel projects and advocating for a transition to clean energy |
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What You'll Learn
- Fossil fuel infrastructure induces its own demand
- The world has no capacity for new fossil fuel plants
- Fossil fuel infrastructure is a threat to global economic stability
- Fossil fuel infrastructure violates Indigenous rights and destroys the climate
- Fossil fuel infrastructure creates inertia that distorts future decision-making
Fossil fuel infrastructure induces its own demand
Fossil fuel infrastructure does induce its own demand. Fossil fuels have been a critical source of energy and have played a dominant role in global energy systems. They were key to industrialization and rising prosperity, but their impact on health and the climate means that we need to transition away from them.
The concept of "carbon lock-in" or "infrastructure lock-in" explains how the expansion of fossil fuel infrastructure deepens our dependence on those fuels and creates barriers to change. Fossil fuel companies intend to maximize the use of this infrastructure for decades, and their influence over public policy and inconsistent commitment to climate action by governments may allow them to do so.
The continued development of fossil fuel infrastructure will make it harder to transition to cleaner energy sources. This is because once the infrastructure is built, there is an incentive to recover the investment and continue profiting from it, creating inertia that distorts future decision-making. This inertia will need to be overcome for any meaningful shift to occur.
The consequences of allowing more fossil fuel infrastructure are significant. It harms communities affected by fossil fuel production and creates an even bigger challenge for future generations to address the resulting environmental issues. Additionally, investments in fossil fuel infrastructure could pose a threat to global economic stability as assets may lose their value if power plants, refineries, and industrial facilities need to shut down or employ costly carbon-capture technology to reduce their carbon emissions.
To limit global warming and meet climate goals, no new fossil fuel infrastructure should be built, and some existing infrastructure may need to be retired early. The transition to clean energy requires smart reforms in financing, planning, and permitting to accelerate the deployment of energy efficiency, renewables, and low-emission transportation.
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The world has no capacity for new fossil fuel plants
The world has already built so many fossil-fuel-burning power plants, factories, vehicles, and buildings that their normal operation over their full lifetimes will likely warm the Earth beyond the Paris Agreement climate target of 1.5 degrees Celsius (2.7 degrees Fahrenheit). To limit warming to 1.5°C, not only should no new fossil-fuel-using infrastructure be built, but some existing power plants will also have to shut down early. However, today, many new power plants are under construction or planned.
Decisions made today on whether or not to build more fossil-fuel infrastructure will lock in future CO2 emissions and determine whether the world can keep global warming below 2°C. The potential carbon commitment from the coal, gas, and oil-burning power plants currently under construction or planned will use up most of the carbon budget remaining between today and a world that's 2°C warmer. Fossil fuel infrastructure induces its own demand, deepening our dependence on those fuels and creating additional barriers to change. This is known as "carbon lock-in" or "infrastructure lock-in."
The International Energy Agency (IEA) has warned that the world has no capacity to absorb new fossil fuel plants. The IEA calculated that existing infrastructure would lock in 550 gigatonnes of carbon dioxide over the next 22 years, leaving only 40 gigatonnes of wriggle room if temperatures are not to exceed the 2°C threshold. To limit temperature rises to 2°C or the recommended 1.5°C, all new energy projects would have to be low-carbon, or existing infrastructure would need to be cleaned up through incentives for dirty power plants to retire early or the installation of carbon capture and storage technologies.
The 28th UN Climate Change Conference (COP 28) commitment to transition away from fossil fuels in energy systems is a positive step. Initiatives like the Powering Past Coal Alliance, the Beyond Oil and Gas Alliance, and the Clean Energy Transition Partnership are applying a norm-building approach to fossil fuels. Researchers have found that governments can help build a global norm against new fossil fuel projects by banning them, and civil society can advocate for these bans. A study by University College London and the International Institute for Sustainable Development (IISD) found that existing fossil fuel projects are sufficient to meet projected energy demands in a global transition to net-zero emissions.
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Fossil fuel infrastructure is a threat to global economic stability
The construction of new fossil fuel infrastructure poses a significant threat to global economic stability. The continued development and expansion of fossil fuel projects, such as power plants, refineries, and pipelines, lock in future carbon emissions and contribute to global warming. According to the Paris Agreement, the world aims to limit global warming to well below 2°C, preferably to 1.5°C, compared to pre-industrial levels. However, the existing fossil fuel infrastructure, if operated as usual, will exceed this target, leading to devastating climate change impacts.
The science is clear that additional fossil fuel infrastructure is incompatible with preventing the worst consequences of global warming. Each new fossil fuel project deepens our dependence on these fuels and makes it harder to transition to cleaner alternatives. This phenomenon is known as "carbon lock-in" or "infrastructure lock-in", where the continued use of fossil fuels becomes entrenched, and the challenges of transitioning to cleaner energy become more significant. Furthermore, the social and economic pressures to maintain high fossil fuel revenues can lead to increased government spending, even when the demand for fossil fuels is expected to decline permanently.
The economic risks associated with fossil fuel infrastructure are substantial. Trillions of dollars' worth of fossil fuel-intensive assets may lose their value as power plants, refineries, and industrial facilities are forced to shut down or adopt costly carbon capture technologies to reduce their carbon emissions. Fossil fuel companies and governments with significant investments in the industry will face stranded assets and reduced profits as the world transitions to cleaner energy sources. These economic losses provide a strong incentive for the fossil fuel industry to resist climate stabilization efforts and continue business as usual, endangering the planet further.
Moreover, the construction of new fossil fuel infrastructure induces future demand for these fuels. Companies proposing gas expansion aim to maximize the use of their infrastructure, often over several decades. This dynamic ensures a continued reliance on fossil fuels and delays the much-needed transition to cleaner energy sources. The longer we delay, the more challenging it becomes to undo the historical mistakes of investing in fossil fuels and the more severe the impacts of climate change will be.
To ensure global economic stability and a livable planet, no new fossil fuel infrastructure projects should be initiated. Instead, investments should be directed towards renewable energy sources and the development of low- or zero-carbon emission energy industries. Smart reforms in the financing, planning, and permitting of clean energy projects can accelerate this transition. Additionally, initiatives such as the Powering Past Coal Alliance, the Beyond Oil and Gas Alliance, and the Clean Energy Transition Partnership are crucial in building momentum for a global shift away from fossil fuels.
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Fossil fuel infrastructure violates Indigenous rights and destroys the climate
The construction of fossil fuel infrastructure has severe consequences for the climate and Indigenous rights. The latest scientific evidence confirms that no new fossil fuel projects are needed to meet the Paris Agreement's 1.5°C global warming limit. Despite this, many new power plants are under construction or planned, locking in future CO2 emissions and making it harder to transition to clean energy. This "infrastructure lock-in" or "carbon lock-in" effect creates inertia and distorts future decision-making, as companies intend to maximize the use of this infrastructure for decades.
Indigenous peoples in the United States, Canada, and throughout the Americas have experienced systematic and repeated violations of their treaty rights by the fossil fuel industry. With 35% of the United States' fossil fuels located on or near Indigenous lands, these communities are targeted by unrestrained corporate exploitation, resulting in ecological devastation and human rights abuses. Sacred sites are destroyed, aquifers are dried up, micro-climates are altered, and the air and soil are poisoned with toxins. The true cost of fossil fuel extraction and refining is borne by Indigenous communities, who suffer the impacts of catastrophic global warming and severe climatic changes.
The movement to hold investors and financial institutions accountable for violating Indigenous rights and contributing to climate disasters is gaining momentum. Indigenous leaders and climate advocates are confronting banks, such as RBC in Canada and Bank of America, for their risky fossil fuel investments and complicity in human rights abuses. These banks are accused of prioritizing profits over people, financing projects that blatantly disregard the fundamental principle of free, prior, and informed consent from Indigenous communities.
To address these issues, initiatives like the Powering Past Coal Alliance, the Beyond Oil and Gas Alliance, and the Clean Energy Transition Partnership aim to phase out fossil fuels and transition to clean energy. By building momentum and creating norms, these initiatives strive to make the transition away from fossil fuels equitable and just for all stakeholders. However, the challenge remains to ensure that fossil fuel-producing countries and companies commit to these norms and transition away from fossil fuel infrastructure, which violates Indigenous rights and destroys the climate.
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Fossil fuel infrastructure creates inertia that distorts future decision-making
The world is currently on a trajectory to exceed the Paris Agreement's target of limiting global warming to 1.5°C or 2°C. To meet these targets, not only should no new fossil fuel infrastructure be built, but some existing power plants will also need to be shut down. However, the reality is that many new power plants are under construction or planned. This is because fossil fuel infrastructure creates inertia and lock-in effects that distort future decision-making.
Fossil fuel infrastructure, once built, creates inertia over the lifetime of the asset. For example, a car may be in use for 12-15 years, while a pipeline will be in use for decades. During this time, the infrastructure will induce future demand for fossil fuels. This demand will not go away without radical technological shifts, strong government policies, or a combination of both. The inertia created by fossil fuel infrastructure makes it harder to transition to clean energy sources and locks us into a higher-carbon future.
The concept of "carbon lock-in" refers to how every expansion of fossil fuel infrastructure deepens our dependence on these fuels and creates barriers to change. Companies proposing gas expansion intend to maximize the use of that infrastructure for decades. Fossil fuel infrastructure also harms the environment and public health and creates challenges for communities bearing the immediate impacts of fossil fuel production.
To transition away from fossil fuels, smart reforms and investments in clean energy technologies are necessary. This includes accelerating the deployment of energy efficiency, renewables, energy storage, and low-emission transportation. Additionally, governments play a crucial role in phasing out fossil fuels through initiatives such as the Powering Past Coal Alliance, the Beyond Oil and Gas Alliance, and the Clean Energy Transition Partnership. These initiatives aim to establish norms and commitments to end licensing for new oil and gas projects and provide no international public finance for fossil fuels.
In conclusion, fossil fuel infrastructure creates inertia and lock-in effects that distort future decision-making by inducing demand for fossil fuels and deepening our dependence on them. To meet global warming targets and transition to clean energy, it is essential to address the inertia created by fossil fuel infrastructure through technological advancements, strong policies, and initiatives that promote a sustainable future.
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Frequently asked questions
The world has so many existing fossil fuel projects that building more will exceed international climate change goals. To keep global warming below 1.5°C, we need to retire old plants and factories and stop building new ones.
Fossil fuel infrastructure induces its own demand, deepening our dependence on these fuels and making it harder to transition to clean energy. It also creates inertia that distorts future decision-making, locking us into a higher-carbon future.
Governments can ban new fossil fuel projects and civil society can advocate for these bans to build a global norm against them. Additionally, pressure on banks to stop investing in fossil fuels and redirecting that money towards sustainable alternatives can help.
