Global carbon emissions fell by 0.5% in 2021, the lowest rate in a decade, as energy use and emissions rose 5.5% compared to 2020, the first year marked by the pandemic. , shows the latest PwC Net Zero Economy Index 2022 report, published in the context of the COP27 meeting in Egypt. In 2020, the rate of reduction of carbon emissions was 2.5% against the background of a drop in global energy demand by 4.3%.

The development in 2021 was influenced by the growth of economic activity against the background of the recovery after COVID-19. Excluding changes due to the Covid-19 lockdown (year 2020), there is a 3% global decarbonisation rate in 2021 compared to 2019.

“The lifting of pandemic restrictions in 2021 has brought about a much-needed recovery in economic activity, but it has also meant a return to higher levels of carbon emissions. Rising energy prices and supply threats have led to increased demand for fossil fuels in the short term. Decarbonisation progress has slowed, despite commitments from governments, companies and investors, so additional efforts are needed to achieve emission reduction targets within the agreed timeframe. For example, the EU has announced that it will increase its emissions reduction targets in 2023, focusing on the deployment of renewable energy sources. The new REPower EU plan sets the share of renewable energy reaching 45% of total consumption by 2030, while reducing energy consumption by 13%. Investing in renewable energy capacity is more welcome than ever, as it is a way to increase energy security and price stability,” said Dinu Bumbeca, Managing Partner of PwC in Romania.

None of the G20 member states, which account for 80% of world GDP and about 80% of global emissions, have achieved a reduction in carbon emissions of more than 5% in 2021. Among the G20, the biggest improvement was 4.6%, good. below the 15.2% decarbonisation level currently required to limit warming to 1.5°C under the Paris Agreement.

Each country and each sector will have its own decarbonisation path, focusing on unique energy balance changes and efficiency gains, as well as other actions such as nature-based solutions and the use of technology, the report said.

For the past 11 years, the PwC Net Zero Economy Index has modeled economic growth and energy-related CO2 emissions against the targets needed to meet the Paris Agreement targets.

The report tracks how economies are making progress in reducing the dependence between economic growth and carbon emissions.