Chairman and CEO
The Institute of Energy Economics, Japan
“G20 New Delhi: Accomplishments and remaining issues”
Message for September 2023
The G20’s New Delhi Leaders’ Declaration was announced on September 10. In the absence of President Putin and President Xi, the international media, as expected, was quick to highlight the tension and divergent views over the Ukraine conflict. Consequently, the messages from the Declaration concerning energy/environment did not receive near the attention they deserved. With the participation of leaders from both the West and the Global South, the G20 can be considered as an international forum representative of the basic global direction.
Having personally experienced the challenges of forming a consensus for the G20 Osaka Summit in 2019, I would like to praise the leadership of the Indian Government in coming up with an agreed Declaration, despite significant disagreements among the members of the G20.
1. Various Pathways
The G20 reconfirmed one of the major messages from the G7 Hiroshima Summit, stressing that there should be “various pathways” for our energy transitions. In particular, such message recognizes the needs, the vulnerabilities, the priorities as well as the different national circumstances of the developing countries. This message of various pathways is very important as there are some countries that wish to impose their particular pathway on other countries, including the developing world.
2. Affordability, energy security and market stability, not only sustainability
Compared with the G7 Communiqué, which was predominantly focused on the climate change crisis, the G20 Declaration is highlighting affordability, energy security and market stability which are vital for the Global South. To be more specific, the G20 Declaration emphasized the importance of “uninterrupted flows of energy from various sources, suppliers and routes” which are essential for energy security. Support for reliable and diversified supply chains for critical minerals and materials were also stressed in this context.
3. Investments to meet the energy demand growth
The G20 Declaration emphasized the importance of “inclusive investments to meet the growing energy demand”. This can be considered as an expansion of the G7 Hiroshima Communiqué that referred to the need for additional investments only in the gas sector with more conditions attached.
I believe that the emphasis on affordability and market stability at the G20, especially for the Global South, is leading to a stronger need for investments. I sincerely hope that financing, both from the public and the private sectors of the advanced economies, will be provided in a smooth and sufficient manner to support investments.
4. Renewable energies + Others
The G20 Declaration stated the pursuit and encouragement of efforts to triple renewable energy capacity globally by 2030. This is a very ambitious goal which will also require low-cost financing, innovation, and grid interconnections, as noted in the Declaration. Low-cost financing for the developing countries is particularly important as there is a significant gap between the level of financing required and what is actually provided. This is one of our remaining homework.
In parallel with renewable energies, the roles of abatement/removal technologies and energy efficiency improvement were recognized. The role of civil nuclear energies was also recognized for countries that opt to use it. I believe that in addition to renewable energies, access to multiple means will be necessary for the energy transitions. No particular option should be excluded.
The Declaration also highlighted hydrogen. It is worth noting that not only hydrogen produced from zero emission technologies, but hydrogen produced from low-emission technologies was also recognized. This implied that hydrogen should not be distinguished by its production process. It should also be noted that ammonia was specifically singled out as an example of hydrogen derivatives reflecting its special role.
The importance of developing mutually agreed harmonized standards was recognized. I believe that this is another homework for the world from the G20 to push forward.
6. Unabated coal power and fossil fuels
The Declaration settled with a language calling for “accelerating the efforts towards the phase down of unabated coal power” which is the same as in last year’s G20. There were proposals with significant differences concerning this language and some members at the Ministerial Meeting were suggesting the “phase down of unabated fossil fuels”.
This was unquestionably a very difficult issue to reach a consensus considering the positions of various G20 members. For those who attach greater importance to sustainability, they argued for the “phase down” or even the “phase out of unabated fossil fuels”. For the fossil energy producing countries, words such as “phase down” or “phase out” would have been unacceptable. For energy consuming developing countries, they should have demanded practical pathways to support their growth and ensure market stability/affordability.
Admitting that little progress was made on this point this year at the G20, I believe that rather than just pushing respective positions, it is important to find practical and realistic pathways to achieve sustainability while supporting growth and ensuring affordability/market stability at the same time. In this regard, I believe that the first point made above, i.e., various pathways, is very important to take into full consideration.
I also believe that of all the homework for the energy/environment sector, this issue is the most important one that we need to take back from New Delhi.
The G20 New Delhi Leaders’ Meeting was very significant for the energy/environment sector. It reflected the views of the Global South and developed many common directions to be pursued. It also clearly identified the remaining important issues that need to be seriously worked on.