WEBVTT - G-20 Climate Policy in Focus 0:00:00.280 --> 0:00:03.200 This is Dana Perkins and you're listening to Switched on 0:00:03.480 --> 0:00:07.080 the b and EF podcast. Earlier this year, BNAF released 0:00:07.120 --> 0:00:10.720 our twenty twenty three edition of the G twenty Policy Scoreboard. 0:00:10.880 --> 0:00:14.160 This is an annual report that evaluates and ranks different 0:00:14.200 --> 0:00:17.119 governments and their climate policies. But in a year of 0:00:17.120 --> 0:00:20.799 turmoil with conflict on the European continent which has led 0:00:20.800 --> 0:00:25.440 to soaring energy prices alongside global inflationary pressures, what has 0:00:25.560 --> 0:00:28.560 changed within the G twenty member states in regard to 0:00:28.600 --> 0:00:32.560 their climate policies. Head of Global Policy at BNF, Victoria Cumming, 0:00:32.680 --> 0:00:35.559 has returned to the podcast today. She shares the countries 0:00:35.600 --> 0:00:37.479 that are at the top of the ranking, along with 0:00:37.520 --> 0:00:40.479 the biggest movers and those who fall near the bottom 0:00:40.479 --> 0:00:43.680 of the stack. She also highlights the impact the US 0:00:43.680 --> 0:00:47.160 Inflation Reduction Act has had. During the conversation, we dig 0:00:47.200 --> 0:00:50.320 a little bit deeper on some specific technologies and industries, 0:00:50.479 --> 0:00:53.760 including those impacting the hard to abate sectors, as well 0:00:53.800 --> 0:00:57.160 as our newest area being assessed in this report, agriculture. 0:00:57.600 --> 0:01:00.120 If you like this podcast, make sure you subscribe to 0:01:00.160 --> 0:01:04.080 receive updates on future episodes. Bn EF subscribers can access 0:01:04.120 --> 0:01:08.200 the full G twenty policy Scoreboard report at BNF on 0:01:08.200 --> 0:01:11.200 the Bloomberg terminal at bf dot com, or on our 0:01:11.240 --> 0:01:13.759 mobile app. If you'd like to join us for an 0:01:13.840 --> 0:01:17.080 upcoming summit taking place the day directly before the B 0:01:17.160 --> 0:01:20.919 twenty meetings, go to about dot BNF dot com forward 0:01:20.920 --> 0:01:24.160 Slash Summit and go to the tab titled New Deli Summit. 0:01:24.480 --> 0:01:26.800 Note that B and EF does not provide investment or 0:01:26.800 --> 0:01:29.240 strategy advice, and our full disclaimer can be found at 0:01:29.280 --> 0:01:31.240 the very end of the show. But right now I 0:01:31.280 --> 0:01:45.919 get to speak with Vicky about the G twenty policy scoreboard. Vicky, 0:01:45.959 --> 0:01:47.680 thank you so much for coming back to the show 0:01:47.680 --> 0:01:48.279 again today. 0:01:48.600 --> 0:01:49.920 Thank you very much for having me. 0:01:50.200 --> 0:01:54.480 So we're here to discuss the G twenty zero carbon 0:01:54.600 --> 0:01:58.000 policy scoreboard. That really rolls off the tongue, but I 0:01:58.040 --> 0:02:00.400 think that's because this is one of the media things 0:02:00.440 --> 0:02:02.400 that we do, is we really try and pull together 0:02:02.480 --> 0:02:04.680 what's happening across the G twenty in terms of the 0:02:04.720 --> 0:02:07.880 transition and the number of different things that are all 0:02:07.880 --> 0:02:11.919 simultaneously taking place. Before we get into the findings of 0:02:11.960 --> 0:02:15.079 this report, can you talk a little bit about what 0:02:15.200 --> 0:02:17.480 this is and really why we're doing it. 0:02:17.639 --> 0:02:22.079 Absolutely so. Policy government policy specifically has been a key 0:02:22.160 --> 0:02:25.840 driver of the energy transition. We really wouldn't have the 0:02:26.040 --> 0:02:28.480 volume of wind and solar power, for example, that we 0:02:28.520 --> 0:02:30.919 have installed now if it had not been for feed 0:02:30.919 --> 0:02:34.560 and tariffs and tax credits and renewables auctions. So the 0:02:34.680 --> 0:02:37.800 overall aim of this policy scoreboard is to give a 0:02:37.880 --> 0:02:42.320 snapshot assessment of the G twenty countries in terms of 0:02:42.520 --> 0:02:47.200 their decarbonization policies. And one of the reasons why it 0:02:47.280 --> 0:02:50.639 is such a MEATI report is because it covers the 0:02:50.840 --> 0:02:53.640 vast majority of the sectors across the economy. So we 0:02:53.720 --> 0:02:59.240 have power, fuels, transport, buildings, industry, waste, circular economy, and 0:02:59.360 --> 0:03:03.080 now also agriculture. And this is the third time that 0:03:03.120 --> 0:03:06.560 we've done this annual report, and so we're now also 0:03:06.720 --> 0:03:10.119 starting to be able to track progress or lack thereof 0:03:10.400 --> 0:03:12.760 in terms of the policies that governments have in place. 0:03:12.919 --> 0:03:15.440 And you mentioned agriculture that was not on the report 0:03:15.520 --> 0:03:15.919 last year. 0:03:15.960 --> 0:03:19.520 Correct, absolutely, yes, countries governments what we'll get more into 0:03:19.600 --> 0:03:23.680 it later are starting to look at how to decarbonize 0:03:23.840 --> 0:03:27.320 the agriculture sector, which is a particularly tricky sector to 0:03:27.600 --> 0:03:29.320 what we'd call hard to abate. 0:03:29.480 --> 0:03:33.720 Before we get into agriculture specifically, let's talk a little 0:03:33.720 --> 0:03:36.960 bit about how we go about assessing countries and really 0:03:37.080 --> 0:03:41.200 ranking them in this report. So you have three different 0:03:41.200 --> 0:03:44.920 ways of going about looking at its robustness, presence, and 0:03:44.960 --> 0:03:47.640 effect Can you talk a little bit about what those 0:03:47.680 --> 0:03:48.920 three are designed to do? 0:03:49.400 --> 0:03:53.119 Absolutely? So, first, I should say, somewhat confusingly, there are 0:03:53.240 --> 0:03:56.440 nineteen individual countries of the G twenty, the Group of 0:03:56.440 --> 0:04:00.160 twenty countries, and that is because the twentieth member of 0:04:00.160 --> 0:04:03.960 the G twenty is the European Union. So we assess 0:04:04.000 --> 0:04:06.840 the countries. Vast majority of them we look at just 0:04:06.960 --> 0:04:10.960 national level policy, but for the European Union member states France, 0:04:11.080 --> 0:04:14.080 Germany and Italy that are actually individual members of the 0:04:14.120 --> 0:04:17.080 G twenty, we also take account of EU level policy. 0:04:17.360 --> 0:04:23.000 And then because of the US and Canada sub national 0:04:23.200 --> 0:04:26.680 policies are so important in terms of the energy transition 0:04:26.760 --> 0:04:30.360 we've seen, we also take account of state and province 0:04:30.440 --> 0:04:33.880 level policies when we're looking at those countries. So, as 0:04:33.920 --> 0:04:38.160 you say, we have these three types of metrics, so robustness, presence, 0:04:38.320 --> 0:04:41.400 and effectiveness. So each of the G twenty countries are 0:04:41.400 --> 0:04:44.520 assessed based on about one hundred or so metrics. And 0:04:44.520 --> 0:04:46.760 then there are these three categories of metrics. So the 0:04:46.800 --> 0:04:50.640 first one is the presence, so what types of policies 0:04:50.680 --> 0:04:53.120 are in place in that country in these sectors, So 0:04:53.200 --> 0:04:56.279 for example, does it have a renewables feeding tariff, does 0:04:56.320 --> 0:05:00.200 it have purchase subsidies for electric vehicles, does it a 0:05:00.200 --> 0:05:03.920 carbon price on industrial emissions. Then we get into the 0:05:04.680 --> 0:05:07.560 biggest slice of the pie, I would say, is the 0:05:07.640 --> 0:05:12.440 robustness metrics. So those are our BNFS qualitative assessment of 0:05:12.480 --> 0:05:14.880 the policies that are in place. So we look at 0:05:15.120 --> 0:05:17.640 the kind of impact of the policies, whether it's having 0:05:17.640 --> 0:05:20.160 as an intended impact. We also look at the policy 0:05:20.200 --> 0:05:23.960 making process, so is it transparent, does it, for example, 0:05:24.040 --> 0:05:28.159 allow stakeholder consultation, does the government announce some changes to 0:05:28.200 --> 0:05:31.320 the policies, to the kind of stability of the policy process. 0:05:31.560 --> 0:05:35.359 And then the last bucket is quantitative metrics that try 0:05:35.400 --> 0:05:39.159 to assess where the policies are actually having the desired effect. 0:05:39.480 --> 0:05:42.680 So we look out, for example, whether a country has 0:05:42.680 --> 0:05:46.080 increased the share of renewable power generation, has it actually 0:05:46.400 --> 0:05:51.599 increased electric vehicle sales, has it decreased building sector emissions 0:05:51.839 --> 0:05:55.200 in recent history? So all those metrics come together, and 0:05:55.240 --> 0:05:57.760 so we have sector level scores and then we have 0:05:57.839 --> 0:06:00.520 an overall score for each country. 0:06:00.600 --> 0:06:02.760 Can we talk a little bit about the time horizon 0:06:02.880 --> 0:06:05.400 with which we look at these different scores, because when 0:06:05.440 --> 0:06:08.080 I think of effectiveness, I think that in some respects, 0:06:08.080 --> 0:06:11.039 there's what's happening right now, which is the result of 0:06:11.080 --> 0:06:13.760 policies that have been on the books for previous years, 0:06:13.880 --> 0:06:17.560 versus projected effectiveness of a policy in the future and 0:06:17.600 --> 0:06:20.080 what we think it may be designed to do and stimulate. 0:06:20.240 --> 0:06:23.240 One might use the USIRA as an example of something 0:06:23.240 --> 0:06:25.279 where there's a lot of discussion around what's going to 0:06:25.279 --> 0:06:29.560 happen in the future as opposed to retrospective looking impacts. 0:06:29.920 --> 0:06:33.240 Where does effectiveness fall on that time horizon for US 0:06:33.279 --> 0:06:36.280 and is it looking backward or looking forward or both. 0:06:36.720 --> 0:06:39.719 So we use the latest data that's available, and different 0:06:39.720 --> 0:06:44.040 types of data are available with different time horizons historically, 0:06:44.160 --> 0:06:47.599 so greenhouse gas emissions data takes a long time to 0:06:47.640 --> 0:06:51.200 collect and to do so on a consistent basis, So 0:06:51.720 --> 0:06:55.279 for some sector level emissions data, we're only looking at 0:06:55.320 --> 0:06:59.560 the most recent levels twenty nineteen. However, with other bits 0:06:59.600 --> 0:07:02.440 of data, especially the kind of data that we Bloomberg 0:07:02.480 --> 0:07:05.040 any F track ourselves. So when we're looking at electric 0:07:05.160 --> 0:07:09.440 vehicle sales or renewable power generation, we're probably looking over 0:07:09.440 --> 0:07:12.160 the last twelve months. As you say, we are seeing 0:07:12.160 --> 0:07:14.360 the impact of the policies that have been in place 0:07:14.400 --> 0:07:17.240 at least for a few years. We also though, because 0:07:17.800 --> 0:07:22.440 investors and developers they look ahead to what potential policies 0:07:22.520 --> 0:07:25.560 coming down the pipeline, So we have started to see 0:07:25.600 --> 0:07:29.160 some impact market level in terms of the effective nyfnessmetrics 0:07:29.560 --> 0:07:33.440 of policies like the Inflation Reduction Act, because for example, 0:07:33.760 --> 0:07:37.200 developers and investment in CCUS has started to creep up, 0:07:37.200 --> 0:07:39.800 and hydrogen started to creep up as well, So there 0:07:39.880 --> 0:07:42.200 is also there is also we take as much as 0:07:42.240 --> 0:07:44.760 possible with the forward looking, but yes, to some extent, 0:07:44.800 --> 0:07:48.080 it's historical as well, just in terms of the effectiveness metrics, 0:07:48.120 --> 0:07:50.680 which contributes about a quarter of a country score. 0:07:51.000 --> 0:07:53.040 And as you mentioned, it does take some time to 0:07:53.080 --> 0:07:57.200 get these greenhouse gases quantified and to be able to 0:07:57.200 --> 0:07:59.480 actually have data that we can work off of. So 0:07:59.520 --> 0:08:02.360 then question really comes down to, given this is the 0:08:02.400 --> 0:08:04.640 third time doing this, and we're doing this at roughly 0:08:04.680 --> 0:08:07.160 a one year interval. How much the things really change 0:08:07.160 --> 0:08:09.680 from one year to the next in terms of the 0:08:09.720 --> 0:08:14.360 results across robustness, presence, and effect do you see I 0:08:14.360 --> 0:08:17.520 suppose if you are looking at policy changes, you're going 0:08:17.560 --> 0:08:20.040 to see a lot of change in presence from one 0:08:20.120 --> 0:08:22.720 year to the next, depending upon what a specific country 0:08:22.760 --> 0:08:26.840 is doing. But given that effects are lagging and robustness 0:08:26.840 --> 0:08:29.840 may take some time to actually get under way in 0:08:29.960 --> 0:08:32.319 order to be able to assess that, do the numbers 0:08:32.360 --> 0:08:35.320 swing wildly in these rankings from one year to the next. 0:08:35.679 --> 0:08:39.400 It's funny because, as you say, you would think that 0:08:40.160 --> 0:08:43.200 the kind of changes might be fairly minimal, at least 0:08:43.240 --> 0:08:46.280 on the effectiveness metrics, but actually we have seen the 0:08:46.400 --> 0:08:49.040 differences a year to year. So one of the reasons 0:08:49.080 --> 0:08:51.440 for that is we try not to use kind of 0:08:51.520 --> 0:08:54.640 absolute changes in absolute volumes of things. We assess a 0:08:54.679 --> 0:08:58.760 country relative to the global to average in some cases. 0:08:58.800 --> 0:09:02.400 In some cases we as OECD countries with the OCD 0:09:02.559 --> 0:09:05.680 average and non OCD with the non OECD average. But 0:09:05.840 --> 0:09:09.680 there are significant changes even so. One of the metrics 0:09:09.679 --> 0:09:11.920 that's most likely to change year to year we've seen 0:09:12.000 --> 0:09:14.640 is actually in terms of electric vehicle sales and the 0:09:14.720 --> 0:09:18.240 share of electric vehicle sales out of all new vehicle cells. 0:09:18.360 --> 0:09:22.640 Well, okay, so let's talk about changes. Let's talk about 0:09:22.679 --> 0:09:25.960 twenty twenty three report and what we're seeing. So one 0:09:25.960 --> 0:09:28.720 of the findings from the report is that Europe is 0:09:28.800 --> 0:09:31.720 essentially leading on some of these policies at the moment. 0:09:31.760 --> 0:09:35.280 So we're looking at what happened in twenty twenty two. 0:09:35.440 --> 0:09:37.960 That's what this report is looking to assess. Can you 0:09:38.480 --> 0:09:40.800 essentially give us a little bit of a punchline and 0:09:41.400 --> 0:09:46.360 which country or countries were the winners, Let's say, if 0:09:46.360 --> 0:09:48.400 you're looking at this as a ranking. 0:09:48.480 --> 0:09:51.840 So in terms of who are the winners, the biggest climber, 0:09:52.000 --> 0:09:54.880 I would say was the US, which jumped up ten 0:09:54.920 --> 0:09:58.160 percentage points, which is a bigger increase than any other 0:09:58.200 --> 0:10:01.960 country by some measure. Result, it's now in fifth position 0:10:02.480 --> 0:10:05.120 out of the kind of overall G twenty rankings. That's 0:10:05.160 --> 0:10:06.040 the biggest change. 0:10:06.200 --> 0:10:08.040 So againing is a form of winning. 0:10:08.600 --> 0:10:15.320 Yes, yeah, but that's a win anyway. Yes, yeah. So 0:10:15.760 --> 0:10:17.839 you might look at this and think, well, yes, it's 0:10:17.880 --> 0:10:20.520 Europe at the top again this year, but actually, if 0:10:20.559 --> 0:10:23.840 you look at the details, so last year, Germany was 0:10:23.840 --> 0:10:27.160 the clear winner by about six percentage points over France, 0:10:27.360 --> 0:10:31.680 but France, because it's made improvements in various sectors, including 0:10:31.679 --> 0:10:35.000 the building sector and industry, it has actually closed that 0:10:35.120 --> 0:10:37.839 gap just to be one percentage point, So we could 0:10:37.880 --> 0:10:42.080 see France overtake Germany next year, depending on how things go. 0:10:42.440 --> 0:10:44.880 The other change i'd flag in the top four is 0:10:44.920 --> 0:10:48.240 that the UK has fallen to fourth position and Italy 0:10:48.360 --> 0:10:51.880 is now in third. For various reasons. The UK tends 0:10:51.920 --> 0:10:55.040 to be pretty good in terms of the policy presence 0:10:55.040 --> 0:10:57.520 of the number of policies it has in place, but 0:10:57.720 --> 0:11:01.200 it also tends to fall down on the robustness because 0:11:01.240 --> 0:11:04.760 the government has a history of announcing support and then 0:11:04.920 --> 0:11:08.760 suddenly announcing changes to that support, generally right reducing it 0:11:09.160 --> 0:11:10.480 or scrapping it entirely. 0:11:11.120 --> 0:11:13.600 Not to name and shame, but who fell the most 0:11:13.640 --> 0:11:15.640 And I guess who's now at the bottom that you're 0:11:15.679 --> 0:11:19.000 not expecting to well, maybe weren't expecting to see there 0:11:19.040 --> 0:11:19.560 in the past. 0:11:20.200 --> 0:11:24.480 So we saw a few countries fall a down the ranking. 0:11:24.640 --> 0:11:28.160 I guess if you're looking generally at the non winners, 0:11:28.200 --> 0:11:30.760 we'll call them for it to be politically. 0:11:30.200 --> 0:11:32.679 Correct, nineteen countries. 0:11:34.040 --> 0:11:37.120 It's not a big surprise that say Russia, Saudi Arabia, 0:11:37.200 --> 0:11:40.800 Turkey are at the bottom. They especially compared with say 0:11:40.840 --> 0:11:43.960 Europe and now the US. They have very little policy 0:11:44.000 --> 0:11:47.040 support in place. They also tend to fall down in 0:11:47.120 --> 0:11:51.599 terms of having less than transparent and stable policy making processes, 0:11:51.840 --> 0:11:54.600 and they are also running behind in terms of the 0:11:54.640 --> 0:11:58.880 effectiveness metrics of things like the share of renewable power generation. 0:11:59.200 --> 0:12:01.959 They tend to be still heavily reliant on fossil fuels. 0:12:02.080 --> 0:12:05.080 A few countries have kind of fallen slightly in terms 0:12:05.120 --> 0:12:08.240 of their score. One is India. This has been in 0:12:08.320 --> 0:12:12.920 various sectors. Various policies have been subsidies have been reduced 0:12:13.000 --> 0:12:17.360 or withdrawn. Still well behind say other G twenty countries, 0:12:17.640 --> 0:12:21.280 even in the Asia Pacific region on electric vehicle sales, 0:12:21.320 --> 0:12:24.280 so kind of progress. Outside the power sector, it has 0:12:24.440 --> 0:12:27.800 very little industrial decarbonization policy in place, and it has 0:12:27.920 --> 0:12:30.079 little sustainable agriculture policy. 0:12:30.360 --> 0:12:33.000 Given that India is hosting the G twenty this year, 0:12:33.040 --> 0:12:35.560 do you think zero carbon policy is actually going to 0:12:35.600 --> 0:12:39.840 feature in those talks, especially given where they seem to 0:12:39.840 --> 0:12:43.280 be falling in terms of it is a priority versus 0:12:43.280 --> 0:12:45.600 some of the other countries that are actually involved. 0:12:45.920 --> 0:12:48.480 So I think climate change is definitely on the agenda 0:12:48.720 --> 0:12:51.400 for the G twenty and the B twenty this year, 0:12:51.720 --> 0:12:54.520 I think the focus will likely be on clean power, 0:12:54.840 --> 0:12:58.080 and all due to India. So that each country's in 0:12:58.080 --> 0:13:01.520 this score board, their total score is weighted by the 0:13:01.559 --> 0:13:05.240 share of the greenhouse gas emissions in their economy, so 0:13:05.600 --> 0:13:08.800 actually power sector emissions. The power sector accounts for a 0:13:08.920 --> 0:13:12.400 large share of emissions in India, so it's not unreasonable 0:13:12.400 --> 0:13:15.000 for them to be focusing on clean power to start with, 0:13:15.280 --> 0:13:19.000 and they've also got some very ambitious policies on clean 0:13:19.080 --> 0:13:22.720 power and elsewhere on things like biofuels and increasingly on 0:13:22.760 --> 0:13:26.040 electric vehicles. But I would imagine that they would be 0:13:26.120 --> 0:13:29.480 focusing on say the power and possibly transport sector these 0:13:29.520 --> 0:13:34.120 two twenty talks, and possibly also there's increasing interest I 0:13:34.120 --> 0:13:37.640 think in India and Asia more generally in terms of 0:13:37.720 --> 0:13:40.800 the carbon markets, so we could also see interest in that. 0:13:41.200 --> 0:13:44.160 So we might even see with the hosting this year, 0:13:44.640 --> 0:13:48.120 potentially them increasing in the rankings, and maybe we'll see 0:13:48.200 --> 0:13:51.800 some changes next year in terms of rising and falling 0:13:51.960 --> 0:13:54.400 on this list, much like the US has this year. 0:13:55.000 --> 0:13:58.320 The difference between I think the US and India is 0:13:58.360 --> 0:14:01.080 that in terms of clean power in deal already has 0:14:01.440 --> 0:14:05.480 both at national and kind of subnational level, various clean 0:14:05.520 --> 0:14:09.360 power policies, both to promote renewable energy and increasingly for 0:14:09.679 --> 0:14:13.480 energy storage as well. I would be surprised if they 0:14:13.720 --> 0:14:17.920 announce and therefore implement around the G twenty more policies 0:14:17.960 --> 0:14:20.520 that push them up the ranking to the extent that 0:14:20.560 --> 0:14:22.040 we've seen in the US this year. 0:14:22.320 --> 0:14:24.760 So if we think about this ranking and this kind 0:14:24.760 --> 0:14:28.720 of unique additional country that isn't a country added here, 0:14:28.800 --> 0:14:32.080 which is the European Union, where does the EU fall 0:14:32.200 --> 0:14:34.040 in all of this? Given that there's a number of 0:14:34.080 --> 0:14:37.040 member states of the European Union that actually rank quite highly, 0:14:37.200 --> 0:14:39.880 so I'd imagine it does bring up their average, But yeah, 0:14:39.800 --> 0:14:40.720 where did they fall? 0:14:41.040 --> 0:14:44.560 So, as you say EU policy, Without EU policy, Germany, 0:14:44.560 --> 0:14:47.920 France and Italy would not necessarily be the at top 0:14:47.920 --> 0:14:49.760 of the ranking, or at least their score would be 0:14:49.840 --> 0:14:52.800 significantly reduced. So one of the reasons is that is 0:14:52.840 --> 0:14:56.480 that in the school Board methodology, a country gets more 0:14:56.600 --> 0:15:00.600 points if policies are policy sticks, So if that means 0:15:00.640 --> 0:15:04.680 they're regulations or mandates that kind of force changed compared 0:15:04.720 --> 0:15:08.120 with say a financial or fiscal incentive that incentivizes and 0:15:08.120 --> 0:15:11.000 seeks to encourage change, and a lot of the EU 0:15:11.080 --> 0:15:13.960 level policy that we take account for France, Germany and 0:15:14.000 --> 0:15:17.520 Italy are those policy sticks. So things like the EU 0:15:17.600 --> 0:15:22.960 emissions trading system, things like mandates around energy efficiency, performance 0:15:23.080 --> 0:15:25.800 of buildings, all those, and various things around kind of 0:15:25.800 --> 0:15:29.040 the use of fertilizers and pesticides in the agriculture sector. 0:15:29.160 --> 0:15:33.520 So I think if the EU was considered an individual country, 0:15:33.680 --> 0:15:35.280 it would likely be at the top. 0:15:35.640 --> 0:15:38.960 Let's get into some specific technologies. Let's start off with agriculture, 0:15:39.000 --> 0:15:41.800 which is the newest entrant to our scoreboard. Now, what 0:15:41.880 --> 0:15:44.800 percentage of global emissions does agriculture actually represent? 0:15:45.160 --> 0:15:50.040 So agriculture that's excluding land use and forestry is around 0:15:50.080 --> 0:15:53.200 twelve percent globally according to the kind of latest twenty 0:15:53.280 --> 0:15:57.680 nineteen data. But that's share really varies across countries. So 0:15:57.760 --> 0:16:00.000 you have countries, for example, in the G twenty five, 0:16:00.360 --> 0:16:04.080 Saudi Arabia is just one percent of their national emissions, 0:16:04.080 --> 0:16:08.480 whereas Brazil it's forty eight percent. So agriculture sector it 0:16:08.560 --> 0:16:12.880 kind of represents a kind of widely different challenge depending 0:16:12.920 --> 0:16:14.400 on which country you're looking at. 0:16:14.560 --> 0:16:16.640 When given that it's such a different challenge. Are you 0:16:16.680 --> 0:16:20.080 seeing with countries that oftentimes, if there are really robust 0:16:20.120 --> 0:16:22.640 policies in place and they're doing well on the scoreboard 0:16:22.640 --> 0:16:25.600 across let's say, the power sector, that they're also doing 0:16:25.640 --> 0:16:28.800 well in agriculture or can it sometimes be an outlier. 0:16:29.080 --> 0:16:32.720 That's a really interesting question. So we found that the 0:16:32.800 --> 0:16:36.240 G twenty countries fell into three buckets. So there was 0:16:36.320 --> 0:16:40.080 one bucket which includes, for example, the European countries and 0:16:40.240 --> 0:16:43.920 the US, where they generally had a relatively good set 0:16:43.960 --> 0:16:47.440 of decarbonization policies in the agriculture sector, as well as 0:16:47.480 --> 0:16:50.160 all the other sectors that are covered by the policy scoreboard. 0:16:50.240 --> 0:16:54.360 But there were three countries, so Australia, Brazil and Argentina 0:16:54.560 --> 0:16:58.520 that scored particularly highly in the agriculture sector compared with 0:16:58.920 --> 0:17:01.800 the other sector, which is really interesting, I mean, and 0:17:01.840 --> 0:17:04.280 I think one of the reasons is that because agriculture 0:17:04.280 --> 0:17:06.919 actually accounts for a sizable share of their economies and 0:17:06.960 --> 0:17:09.800 their for greenhouse gas emissions. And then the final bucket 0:17:09.920 --> 0:17:14.000 were five countries that didn't perform well in agriculture or 0:17:14.040 --> 0:17:15.800 indeed across the other sectors. 0:17:16.040 --> 0:17:19.119 Of the different categories that exist, are some of these 0:17:19.359 --> 0:17:23.720 weighted more heavily, let's say, because of their percentage of 0:17:23.760 --> 0:17:26.840 greenhouse gases. So when you're looking at this overall score, 0:17:27.280 --> 0:17:31.080 is agriculture and industry for example, are they weighted evenly 0:17:31.320 --> 0:17:33.200 or is there a way that we kind of look 0:17:33.200 --> 0:17:35.960 at the policies in light of what they're actually affecting 0:17:36.400 --> 0:17:39.000 in terms of the industry that they're attacking, or is 0:17:39.040 --> 0:17:42.320 it overall we're looking at the greenhouse gas impact and 0:17:42.440 --> 0:17:43.920 it doesn't matter where it's coming from. 0:17:44.359 --> 0:17:48.880 So a country's total score is weighted by each sector's 0:17:49.040 --> 0:17:53.600 share of national emissions. So, taking examples we've just looked 0:17:53.600 --> 0:17:56.760 at before, Saudi Arabia did not score that well on 0:17:57.160 --> 0:18:00.320 agriculture policies, but that didn't matter so much for its 0:18:00.359 --> 0:18:03.040 overall school because it was only agriculture is only one 0:18:03.080 --> 0:18:06.880 percent of its total emissions, whereas for Brazil, it's agriculture 0:18:07.280 --> 0:18:10.399 school actually accounted for half of its total school. 0:18:10.960 --> 0:18:14.119 Okay, well, then let's go now to a technology that 0:18:14.440 --> 0:18:18.359 really is designed in many respects to attack some of 0:18:18.400 --> 0:18:22.120 the hardest to abate, the most difficult things to decarbonize. 0:18:22.160 --> 0:18:26.600 So we're looking at hydrogen now, hydrogen ccus so carbon 0:18:26.640 --> 0:18:29.960 capture utilization, storage and biofuels were all put together, but 0:18:30.000 --> 0:18:32.960 one could argue actually that all three of those have 0:18:33.080 --> 0:18:37.080 the same ultimate end use in that they're designed to 0:18:37.280 --> 0:18:40.280 tackle hard to abate. What percentage of emissions does this 0:18:40.320 --> 0:18:42.720 actually represent and kind of how has this area weighed, 0:18:42.800 --> 0:18:45.199 and then who are the winners in this category? 0:18:45.760 --> 0:18:48.479 So in terms of the waiting, it's a tricky ones 0:18:48.800 --> 0:18:52.520 for this actual category. So we look at fugitive emissions 0:18:52.840 --> 0:18:57.080 and other fuel combustion that isn't associated with another sector. 0:18:57.440 --> 0:19:01.120 In terms of how countries have so, the US has 0:19:01.200 --> 0:19:04.879 always tended to score fairly highly, especially and this is 0:19:04.960 --> 0:19:09.160 pre Inflation Reduction Act, especially compared with its other sectors, 0:19:09.359 --> 0:19:12.840 because it has had historically good at tax credits for 0:19:13.080 --> 0:19:18.000 CCUS and also policies for biofuels, And this year we 0:19:18.040 --> 0:19:19.960 saw it actually rise to the top of the ranking 0:19:20.160 --> 0:19:23.200 for this kind of low carbon fuels and CCUS sector 0:19:23.240 --> 0:19:26.840 that we count together. Then Canada also improved the number 0:19:27.040 --> 0:19:30.680 and quality of policies that are in place for these technologies, 0:19:30.720 --> 0:19:33.320 so it also climbed to third place this year. And 0:19:33.359 --> 0:19:37.720 then Germany has always been historically strong, especially when it 0:19:37.760 --> 0:19:40.920 comes to hydrogen and to letter extend, biofuels. 0:19:41.200 --> 0:19:43.560 For those who listen to this show regularly, they'll have 0:19:43.640 --> 0:19:46.000 noticed that over the last few weeks the Inflation Reduction 0:19:46.080 --> 0:19:48.520 Act has come up a few times, and it has 0:19:48.600 --> 0:19:50.679 had a dramatic impact on a number of the different 0:19:50.680 --> 0:19:54.160 industries that we cover, both now and looking forward, certainly 0:19:54.600 --> 0:19:57.360 not just in the United States, but also with other 0:19:57.400 --> 0:20:01.800 countries reacting in kind with their on policy incentives. So 0:20:02.119 --> 0:20:04.600 hydrogen is certainly at the center of that. There is 0:20:04.640 --> 0:20:08.880 a big conversation around hydrogen essentially maybe not to use 0:20:09.080 --> 0:20:11.280 too big of a word, but booming in the US 0:20:11.280 --> 0:20:14.679 at the moment. Is this what we're seeing right now 0:20:15.240 --> 0:20:17.840 in terms of this ranking? Are we already seeing the 0:20:18.000 --> 0:20:22.240 US make great strides in terms of how well I 0:20:22.280 --> 0:20:24.920 guess all three of the different areas that we look at, 0:20:24.960 --> 0:20:31.399 the presence, robustness, and effectiveness of policies around the hydrogen 0:20:31.440 --> 0:20:34.560 space in the US specifically as a result of the 0:20:34.600 --> 0:20:35.760 Inflation Reduction Act. 0:20:35.960 --> 0:20:38.880 So I think without the Inflation Reduction Act, although IRA, 0:20:39.200 --> 0:20:41.720 the US would not have increased its score to the 0:20:41.800 --> 0:20:45.159 extent it has this year. So in some sectors or 0:20:45.200 --> 0:20:49.520 for some technologies, it's introduced new policies. So for example, 0:20:49.520 --> 0:20:52.119 the hydrogen tax credit, and in that case, so the 0:20:52.240 --> 0:20:54.960 US has gone up in terms of its presence metrics. 0:20:55.040 --> 0:20:59.680 But even for technologies like CCUS, where the US did 0:20:59.760 --> 0:21:02.480 have of some kind of federal mechanisms already in place 0:21:02.520 --> 0:21:07.000 to incentivize them, the IRA, because of its generosity and 0:21:07.119 --> 0:21:10.760 the improved design of these policies, we have increased our 0:21:10.840 --> 0:21:15.639 robustness evalue relation of the US. So to take hydrogen specifically, 0:21:15.800 --> 0:21:19.720 it has likely the best low carbon hydrogen policy in 0:21:19.760 --> 0:21:24.359 place around the world, and certainly from the G twenty perspective, 0:21:24.600 --> 0:21:28.040 and we should see in future iterations of the Policy 0:21:28.080 --> 0:21:31.560 Scoreboard report that this then gets reflected in terms of 0:21:31.600 --> 0:21:34.919 the effectiveness metrics as well. One thing I would flag 0:21:34.960 --> 0:21:37.280 and question that I have got is why has the 0:21:37.400 --> 0:21:40.320 US not actually surpassed some of the European countries that 0:21:40.359 --> 0:21:42.600 are top of the school board this year and for 0:21:42.680 --> 0:21:47.040 that week talk again about the policy carrots versus policy sticks. 0:21:47.359 --> 0:21:51.200 So the policy carrots, like the tax credits within the IRA, 0:21:51.600 --> 0:21:54.800 while they can be very well designed and generous, they 0:21:54.840 --> 0:21:59.880 can only encourage change, whereas European countries, so the former 0:22:00.200 --> 0:22:03.760 and the current the European Union countries they have in 0:22:03.800 --> 0:22:07.000 place many more of these policy sticks that force changed, 0:22:07.080 --> 0:22:12.359 so things like carbon pricing, mandates on energy efficiency improvements, 0:22:12.760 --> 0:22:15.760 use of certain fuels, fossil fuel phase outs in the 0:22:15.800 --> 0:22:20.600 power and increasingly building heat sectors, and in various environmental 0:22:20.640 --> 0:22:24.800 regulations in agriculture sector. So that is why they retain 0:22:24.880 --> 0:22:27.439 the top spots for this year anyway. 0:22:27.720 --> 0:22:30.399 Well, so let's talk about another area where the US 0:22:30.440 --> 0:22:32.959