The circular carbon economy index is a tool whose time has come

The circular carbon economy index is a tool whose time has come

The circular carbon economy index is a tool whose time has come
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In 2022 and 2023, the Middle East and North Africa will witness radical movements in climate change and energy policies as the region hosts two UN Climate Change Conferences for the first time: COP27 in Egypt and COP28 in the UAE. In contrast, the world is reeling under several economic and political pressures during the COVID-19 recovery period, even as the supply chain issues, the food crisis and the Ukrainian-Russian War top the list of problems.

Energy and climate change issues are among the most pressing trials countries face in these critical times, and it gets worse when they address them simultaneously.

Herein lies a real opportunity for the region to participate positively in reshaping the international climate and energy policy map through several effective initiatives and implementation strategies focused on achieving net-zero emissions by mid-century.

In the run-up to the 2021 UN Climate Conference, Saudi Arabia and other Gulf Cooperation Council countries updated their medium-term greenhouse gas emission targets by submitting revised nationally determined contributions under the Paris Agreement and their ambitious net-zero targets.

Additionally, there has been considerable effort in developing more detailed roadmaps and implementation plans. In this context, Saudi Arabia and many other countries will aim to achieve these targets through the circular carbon economy approach.

The circular carbon economy was a centerpiece when Saudi Arabia held the presidency of the Group of 20 nations in 2020. G-20 leaders endorsed the concept as a voluntary, holistic, integrated, pragmatic approach to managing emissions while promoting economic growth. The idea is based on three pillars of the circular economy: reducing, recycling and reusing, but it adds a fourth pillar of removing. Also, the CCE focuses on energy and emissions flows instead of materials and products. Its ultimate goal is to enable net-zero emissions in line with a climate-safe, resilient and prosperous world.

The CCE approach embraces all mitigation technologies, such as renewable energy and carbon capture, utilization and storage and activities such as improving energy efficiency, fuel switching, and natural carbon sinks.

In simple terms, CCE is a framework for examining a wide variety of emissions reduction, avoidance, and removal approaches to identify strengths and weaknesses and opportunities and challenges related to the implementation.

So, how can the CCE be applied in practice in different countries? How can it be utilized for policymaking? At KAPSARC, we tackled this question by developing an index for measuring and comparing countries on various dimensions and areas of the CCE. The purpose of this Circular Carbon Economy Index, launched last year, 2021, at COP26 in Glasgow, was to put forward common metrics that could be applied to any country. It has two parts: one measures countries’ current CCE performance, and the other maps the enabling factors that help them accelerate their CCE transitions.

The 2022 edition of the CCE Index, launched at COP27 in Sharm El-Sheikh, widened its scope with essential updates. The number of countries included in the index has been increased from 30 to 64, extending coverage to more than 90 percent of the global gross domestic product and GHG emissions.

In 2022, Norway, the Netherlands, Germany, the United Kingdom and Switzerland topped the CCE Index. At the bottom were five Sub-Saharan African countries. The gap between these top five and bottom five performers was notable, indicating that countries toward the end of the list would need significant assistance to transition to CCEs successfully.

While country rankings are easy to understand for policymakers, the media and the general public, composite indicators like the CCE Index are comprehensive. They contain valuable information that goes far beyond simple numbers when deconstructed.

Taking the example of Saudi Arabia, its total rank among the 64 countries is 22. This picture alone only gives a general idea of where the Kingdom stands compared to its peers.

However, when it comes to assessing another part of the score on how effectively Saudi Arabia performs in various CCE activities, it is ranked 18th. The score here positively captures the Kingdom’s vast green hydrogen production capacity pipeline, conservation of its existing natural carbon sinks and the progress made in recent years in switching from liquid fuels to natural gas in the power sector.

In the area of CCE transition enablers, the Kingdom ranked 29, and the score improved in all five dimensions compared to the score of the 2021 index. In addition, it ranked above the global average in aspects such as business environment and system resilience.

Moreover, areas such as policies and regulation, higher coverage of key biodiversity area protection policies, frequent international emissions reporting, and climate change policy could boost the Kingdom’s position in future index editions.

Other areas with brighter prospects of raising the Kingdom’s score are technology, knowledge, and innovation, which could expand research and development outputs, including academic publications and clean energy patents. It could also increase international high-technology exports and imports, improving the score in the future.

Finance and investments are the most crucial enablers for CCE transitions. Here, green sukuk from the Public Investment Fund, investments in clean energy projects, and the development of regulated carbon markets would provide a crucial boost for the Kingdom to realize its climate ambitions and transition toward a CCE.

As a data-based tool, the CCE Index helps answer several vital questions, such as how countries fare today on different CCE technologies and activities. How much potential do they have in accelerating their transition toward carbon circularity? And finally, through these answers, policymakers can trace the future of sustainability in the world.

  • Thamir Alshehri is an expert in KAPSARC’s Climate and Sustainability Program.
Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News' point of view