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Donald Trump’s climate rollbacks can’t hold back global green economy

, August 23, 2018, 0 Comments

us-green-economy-marketexpress-inTrump has handed the fossil fuel industry another gift by rolling back coal regulations. Despite such actions, experts say the global green economy will continue to grow.

US President Donald Trump has yet again dealt a blow to the environment.

This time, he’s replaced strict Obama-era coal regulations with his Affordable Clean Energy Rule (ACE), which would allow states rather than the federal government greater control over regulating coal power plants.

The US Environmental Protection Agency said the proposal would fulfill Trump’s goal of “energy dominance” by creating new jobs and boosting the US economy to the tune of $400 million (€345 million) annually.

But the EPA also admits the plan could lead to 1,400 additional premature deaths per year by 2030 as a result of air pollution. And that doesn’t include the climate-changing effects of more emissions.

Trump’s most recent environmental rollback follows a string of actions to gut environmental protections, including his June 2017 pullout from the Paris climate accord last year removal of “climate change” and “global warming” from government websites.

Best despite such efforts, experts say the global market continues to take a greener turn by building out clean energy and socially and environmentally responsible investment.


Trump’s environmental policies have sought to unravel reforms by former US President Obama

Clean energy goes mainstream

But despite efforts by Trump’s administration to unwind carbon pollution policies, clean energy investing continues to trend upward.

Farzana Hoque, a research and communications consultant with the US Forum for Sustainable and Responsible Investment (US SIF), told DW that the trend is becoming noticeable in the US despite Trump’s pledge to end the “war on coal.”

“Climate change investments … have increased more than five-fold between 2014 and 2016, to $1.42 trillion in the United States,” she told DW.

Solar and wind industries employ nearly 10 times more people than coal mining companies in the US.

Furthermore, US investment in fossil fuel sectors has decreased nearly tenfold over the past few years.

Since US SIF started tracking fossil fuel divestment in 2014 when it became a noticeable trend, it found that “investors had reduced their divestment policies or adopted fossil fuel restrictions” to a large extent.

In January 2018, New York City said it would divest its multi-billion US dollar public pension fund from fossil fuels over the next five years. It’s a notable recent notch in the ongoing wave of global fossil fuel divestment.


Coal is the dirtiest fossil fuel

Environmentally responsible investment

In June 2018, US-based Goldman Sachs Asset Management launched a so-called JUST equity fund that invests in US companies that prioritize fair pay for workers, charitable donations and companies that produce low greenhouse gas emissions, among other environmental, social and governance (ESG) measures.

The JUST fund ended its first day in trading with more than $250 million in assets, becoming the most successful launch of its kind in history. Its success has added to investor confidence.

“Many investors see the moral and business case for investing in clean energy. Although the Trump administration has been rolling back environmental regulations, businesses and other entities have committed to reducing carbon emissions,” Hoque said.

Other companies and entities across the world are also ramping up the importance of environmental and social factors in their portfolios.

Europe’s largest bank, HSBC, has prohibited the financing of new coal power plants in several countries, and has also reduced funding for new offshore oil and gas projects in the Arctic.

Japan announced 2017 that it would triple environmental, social and governance factors in its Government Pension Investment Fund, allocating its share of equity from 3 to 10 percent. Japan has the world’s largest such fund, equaling around $1.3 trillion.


Japan is among countries shifting toward renewables to power their economies

Critics point out that investing in a green economy retains challenges.

Colin Vance, deputy director of the environment and resources section of the Leibniz Institute for Economic Research in Germany, told DW that investing in green energy is not always cost-effective.

He pointed out that since 2000, Germany has spent nearly €100 billion on reducing its greenhouse gas emissions, yet will not even attain its self-imposed goal of reducing emissions 40 percent by 2020.

EU lends tailwind to clean economy

The European Union recently upped it own commitment to cut greenhouse gas emissions 45 percent by 2030. It also aims to produce 27 percent of its energy from renewable sources by that same deadline.

There has also been notable progress with the EU emissions trading system. Although carbon markets have been trumpeted as an effective tool for reducing emissions, the EU’s carbon trading system had been dogged by too-low market prices for carbon allowances. Regulatory reform slated to take effect at the start of 2019 have driven these prices up.

According to a recent report by Carbon Tracker, the price of carbon in the EU could rise to around €25 by the end of 2018. By the end of 2023, prices could even exceed €35.

The markup is expected to change how Germany and other EU countries consume energy, making it more economically feasible to switch from coal to cleaner forms of energy in the face of climate change.

“Europe is moving toward getting the price right through taxes and measures that reflect true costs,” Vance concluded.