Moderator : Cédric Merle, Head of Center of Expertise, GSH Natixis CIB
Efforts to invent a low-carbon economy have not come to fruition yet. Emissions keep rising or, at best, flattening. Why such a stalemate?
Faced with energy and geopolitical shocks, as well as the early and harsh tangible physical consequences of climate change, governments postpone decisive actions: fossil fuels rebates are increased, coal phase out deferred. Despite being increasingly aware and mobilized, businesses struggle to implement the necessary transformations at an appropriate scale and pace. Meanwhile, civil societies are highly polarized, with seemingly irreconcilable calls for “acceleration” but also for “protection” across and within societies.
Are we facing a problem with the method? Carbon pricing and market-based mechanisms are working, but only in handbooks; in reality governments resort to an uncoordinated mix of policies, raising the question of consistency and efficiency. Subsidies pile up, standards and bans increase. Supply and demand are desynchronized due to social, technological, and political factors, causing shortages and price volatility.
Panelists shared views on how to face this dilemma between “acceleration” and “protection”.
A few takeaways:
✅ The necessary reconciliation of energy transition and social cohesion for greater acceptability (nexus efficiency, “sobriety”, and affordability);
✅The transformation not only of the supply (i.e., shrinking the brown energy supply, growing the green one), but also of the demand in order to avoid mismatches and shortages;
✅ The imperative to minimize the cost of the transition (through innovation & competition to lower the price of low-carbon technologies) and guarantee a fair level playing field;
✅ The flexibility & adjustment of tools and strategies to the results they deliver and to different contexts (geographies & sectors) and a subsequent tolerance for setbacks;
✅The need to redesign market mechanisms beyond sustainable finance marginal adjustments.