Climate policy in 2023
Climate policy in 2023 | Nature Reviews Earth & Environment
In 2023, national and international climate policy advanced in many areas but also faced substantial domestic hurdles in others. Countries agreed on new global initiatives and many major emitters expanded national climate policies. However, others rolled back existing policies and continued to support fossil fuels, slowing down global progress.
Key points
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A tug of war between negative developments in some countries and positive developments in others is insufficient. It is only with all countries moving in the same direction that climate policy will reach the pace needed to safeguard sustainable development for all.
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Domestic developments are often contradictory, as demonstrated by the simultaneous expansion of coal and renewables in major emitters. Ensuring coherent climate policies within countries’ borders remains fundamental to meeting the goals of the Paris Agreement.
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New initiatives and mechanisms to support international cooperation, such as the Global Renewables and Energy Efficiency Pledge, help to advance national and global climate policy, but they will require credible national action to back them up.
Global emissions continue to rise, including in 2023 (ref. 1), highlighting the ongoing political challenges of reducing them. Indeed, the 2023 Global Stocktake — the process that assesses the collective progress of the Paris Agreement — demonstrated that climate plans remain insufficient to curb emissions 2; meeting the current Nationally Determined Contributions (NDCs) would result in a 2% decrease from 2019 levels 3. Yet, there has been some progress aided by national and international climate policies: most countries now have net-zero targets, and climate change became firmly placed in national political debates worldwide. However, the pace of progress and overall climate policy adoption remains woefully inadequate 4.
Here, we present critical national and international climate policy developments from 2023 (Table 1). Although this discussion is not exhaustive, it underscores the fact that climate policy moves forward but conflicting actions impede progress.
Global and international policies
Meeting the collective goals of the Paris Agreement requires international coordination. Although this international process is often slow, many developments in 2023 showcase progress, including at the 28th Conference of Parties (COP28) in Dubai.
COP28 established the Loss and Damage fund to support developing countries in minimizing and addressing the impacts of anthropogenic climate change. The fund raised almost USD 800 million by the end of COP28, with the most substantial contributions from the United Arab Emirates and Germany. Although discussion remains open regarding fund contributions and allocations, its launch acknowledges the need for additional international climate finance.
New international initiatives were also announced. Examples include the Global Renewables and Energy Efficiency Pledge, aiming to triple the global installed capacity of renewable electricity and double annual energy efficiency improvements by 2030, and the Oil and Gas Decarbonization Charter, mobilizing companies to reduce emissions from oil and gas production. Together, these and other voluntary initiatives contribute to national action and would help close up to one-third of the emission gap if fully implemented 5.
COP28 also marked the end of the first Global Stocktake. The Stocktake demonstrated that countries’ past and projected emission trajectories remain misaligned with the goals of the Paris Agreement, reiterating the need for substantially enhanced efforts. Specifically, although countries’ aggregated NDC targets at the end of 2023 result in emissions ~10% lower by 2030 compared to those submitted in 2015, a four- to five-fold improvement is required by 2030 (ref. 6). However, the Stocktake positively highlighted that NDCs are now more comprehensive, transparent and broader in scope. For instance, most include adaptation measures and provide more information about the NDC formulation process, implementation and monitoring, supporting accountability efforts.
In addition to COP28, 2023 witnessed the development of additional international partnerships to support climate policy. For instance, the Just Energy Transition Partnerships (JETPs) — aimed at mobilizing billion-dollar investments to support the transition from fossil fuels in the power sector — saw progress. South Africa, Indonesia and Vietnam solidified their investment plans, communicating concrete targets for the reduction of fossil fuels and the financial needs from private and public sources to realize them. Senegal also launched a JETP with France, Germany, the European Union, the UK and Canada to accelerate renewables. Although many points in these partnerships remain open, they showcase a new phase in international cooperation in support of the Paris Agreement process.
However, not all areas progressed, namely with respect to international carbon markets. Among others, concerns persist regarding the calculation of emission reductions used to generate credits. Indeed, many credits, which were generated under voluntary rules in the absence of official standards, do not substantially reduce emissions and put the whole industry into question 7. The next steps on international carbon market rules under the Paris Agreement were also not yet agreed as planned. As a result, more stakeholders move away from claiming that credits help to neutralize their emissions and instead move towards acknowledging them and claiming only contributions to emission reductions elsewhere.
National policies
International cooperation is fundamental for coordinating efforts to limit and adapt to climate change, but concrete measures are adopted at the country (or group, such as the EU) level. The EU, for instance, has various policies that could halve emissions from 2015 to 2030 if fully implemented 8. In 2023, the EU legislated most of the Fit for 55 package, including multiple measures to reduce emissions by 55% below 1990 levels by 2030. Among these measures is a second Emission Trade Scheme to cover buildings and road transport sectors, previously not covered by a carbon price at the EU level. The package also introduces a Carbon Border Adjustment Mechanism, aiming to ensure that imports and domestic production are subject to equivalent carbon prices.
The US also expanded its climate policy in 2023, the impact of which could reduce greenhouse gas emissions between 22–40% below 2015 levels by 2030 (ref. 8). Namely, it continued rolling out the mechanisms created under the Inflation Reduction Act — the country’s most ambitious climate policy to date — to support diverse climate protection measures, including expansion of public transport and strengthening supply chains for clean technologies 9. One of these mechanisms is the USD 22 billion Greenhouse Gas Reduction Fund that supports uptake of clean technologies, mobilizes private finance and reduces distributional effects of climate action. The US also proposed additional policies to regulate emissions, particularly enforcing tighter emission reduction standards for road vehicles (cutting average vehicle emissions every year from 2027) and fostering an increase in the share of electric vehicles. This proposal is still under discussion but could have a substantial additional effect on the country’s emissions.
Other countries also saw positive policy developments. In Brazil, efforts were focused on reinstating institutions and policies that were previously rolled back, including reactivating the Amazon Fund and re-establishing the Plan to Prevent and Control Deforestation in the Amazon Region. In India, the Energy Conservation Amendment Act was enforced since January 2023, introducing a carbon credit trading scheme, mandates for non-fossil energy supply, building codes and energy standards for vehicles. All these policies help to curb the fast-increasing energy demand in the country. In Japan, a law was adopted that established an emissions trading scheme which began operation on a voluntary basis in 2023, a carbon levy which will come into force within the next five years, and an issuance of climate transition bonds to support funding for emerging technologies. Mexico started the first phase of the Sonora Plan, a new renewable energy plan that aims to deploy solar PV and facilitate low-carbon investments in the north of the country. South Korea also released its National Basic Plan for Carbon Neutrality and Green Growth, outlining sector-specific objectives and measures to reduce emissions in line with its net-zero target.
However, several countries put forward contradictory developments that hinder domestic progress. China, the world’s top emitter, exemplifies this dichotomy. On the one hand, the government has various policies to reduce emissions by controlling coal consumption and ramping up renewables 8. Indeed, the renewable project pipeline indicates that China could achieve its 2030 targets for wind and solar energy by 2025. Moreover, China shifted its focus from energy to carbon controls in 2023, placing emphasis on reducing emissions instead of reducing energy use. On the other hand, the government has simultaneously expanded its coal-fired power plant fleet. In the first half of 2023, for example, China approved 52 GW of new coal power plants and began construction on 37 GW. Accordingly, China’s emissions will likely plateau by 2030 instead of declining 10.
Indonesia’s climate policies also embody these contradictions. They aim to cap on-grid emissions and are planning a roadmap to decarbonize the country’s off-grid system in 2024. Yet, in 2023, a large pipeline of off-grid coal-fired power plant projects was approved. This expansion of the unabated coal fleet is expected to increase emissions up to 2030 (ref. 8), which in opposition to what needs to happen globally in order to align with the Paris Agreement.
Additionally, some countries move in the complete opposite direction owing to active resistance from vested interests and policy rollbacks. The UK exemplifies such moves, announcing rollbacks to several climate policies in 2023. In particular, the UK reversed decisions on the phase-out of new petrol and diesel cars from 2030 to 2035, and of gas boilers from 2026 to 2035. These rollbacks are expected to substantially slow UK emissions reductions and push back net-zero goals, misaligning with overarching climate goals 8.
Summary
International and national climate policies progressed on many fronts in 2023. For instance, countries reached agreements on additional mechanisms for international cooperation, such as the JETPs and the Loss and Damage Fund, and many major emitters adopted additional climate policies aimed at driving future emissions reductions. However, climate policy also regressed, as demonstrated by the UK’s backtracking on its climate commitments. This apparent tug-of-war — where positive developments and negative developments cancel out — makes halving emissions by 2030 nearly impossible, leading to slow or stagnant global progress toward the Paris Agreement. It is only with all countries moving in the same direction that climate policy will safeguard sustainable and just development for all.
Additional international cooperation initiatives and climate policies without substance do not necessarily reduce actual emissions and, in some cases, could hinder progress. Some initiatives, such as the Oil and Gas Decarbonization Charter, will likely prolong the use of fossil fuels when they focus on improving the efficiency of fossil fuel use instead of adopting well-established technologies and behaviours to phase them out completely. Similarly, countries that set out ambitious visions without adopting corresponding policies are another example of measures that lack substance and delay global progress.
Nonetheless, there is a growing understanding that all sectors of the economy need to transition to zero emissions. Accordingly, there was a positive shift from merely setting goals and visions to anchoring those in national policymaking. The events of 2023 made it clear that climate policy coherence within and among countries is still necessary to accelerating global climate action.
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Acknowledgements
We thank I. Dafnomilis, E. Hooijschuur, S. Woollands, A. Missirliu, J. Wong, H. Fekete, G. de Vivero, S. Lui, N. Pelekh, F. Hans, M. J. de Villafranca Casas, N. Forsell and Z. Araujo Gutiérrez for their insights into policies adopted in different countries. We also thank L. Jeffery, H. Fearnehough, C. Hareesh Kumar and L. Ock for their inputs. This work was supported by the H2020 European Institute of Innovation and Technology (grant agreement 101056873 (ELEVATE)).
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Nascimento, L., Godinho, C., Kuramochi, T. et al. Climate policy in 2023. Nat Rev Earth Environ (2024). https://doi.org/10.1038/s43017-024-00541-1
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DOI: https://doi.org/10.1038/s43017-024-00541-1