Phasing out fossil fuels, not just simply rebuilding low-carbon systems, should be the goal of COP30.
As COP30 approaches in Belém, Brazil, there is an idea that is gathering pace amongst influential scholars, policymakers, and the Tony Blair Institute that the challenges of the energy transition can be reduced to a single maxim: build first, break later. According to this view, governments should focus their energy and resources on constructing new low-carbon systems before turning to the difficult work of dismantling the old, fossil fuel-based ones.
It is an idea of seductive simplicity. Politicians crave a narrative that promises growth and innovation, rather than one of disruption and decline. But its simplicity is also its flaw. The energy transition cannot be sequenced so neatly. It is of course true that scaling up renewable energy and electrifying whole economies is vital to addressing the climate crisis, but so is the rapid and managed phase-out of fossil fuel production and consumption. These processes need to occur in tandem and immediately, not one after the other.
It would be a mistake, in our view, to fail to harness the belated but growing acceptance of the need to regulate and limit the production of fossil fuels, visible in the moves by a number of countries around the world to limit their supply. Since necessity is the mother of all invention, taking fossil fuels out of the energy mix provides ever stronger incentives to build alternatives.
With this in mind, we want to put forward three main arguments. First, without reducing fossil fuel production, renewables are currently only adding to the energy mix rather than displacing fossil fuels, though a tipping point of declining fossil fuel demand may be on the horizon. Second, without efforts to address the current power of the fossil fuel industry, that incumbent power will be used to slow, stall, and sabotage efforts to build alternative energy systems, as it has so many times in the past. Third, transitions are rarely, if ever, linear processes. Phasing out fossil fuels immediately can co-exist with, support, and even incentivize the deployment of capital towards renewables, while creating new economic opportunities around decommissioning and repurposing fossil fuel infrastructures.
First, it is important to stress that an energy transition is undoubtedly taking place. But it is unfolding at different speeds, scales, and locations. In some places, the changes have been rapid, while in others, progress has been slower. The general narrative of a global energy transition is reassuring, but it masks its complexity. With global energy demand continuing to rise, the rapid deployment of renewables is adding to the global energy mix, increasing its share of total final energy demand, but is yet to displace fossil fuel use, which continues to rise. Fossil fuel demand is expected to peak and begin to decline by 2030, but this forecast depends on current rates of renewable deployment and processes of electrification continuing. These are by no means guaranteed.
The notion that we can “build first and break later” also ignores the rigid arithmetic of the remaining carbon budgets under the Paris Agreement. Global climate goals cannot be met without an immediate and managed decline in fossil fuel production. In scenarios that limit warming to 1.5 °C, global coal, oil, and gas supply must fall by about 95 percent, 62 percent, and 42 percent, respectively, between 2020 and 2050. If carbon capture methods fail to deliver, which is a very real possibility, the cuts to the fossil fuel supply will need to be deeper. Despite this, by 2030 governments will have produced more than double the amount of fossil fuels than would be consistent with limiting warming to 1.5°C. For many wealthy and industrialized states, fossil fuel industries should already be in managed decline to allow developing states more time to diversify their economies. This is not happening.
Such a vast production gap constitutes a grave injustice given the climate impacts it generates and the disproportionate role of the richest countries in overconsuming the available carbon budget. The remaining carbon budget for keeping global warming to 1.5°C could be depleted in just three years if carbon emissions, the vast majority of which come from fossil fuels, continue on their current trajectory. Just four Global North countries — the United States, Canada, Norway, and Australia — are responsible for nearly 70 percent of projected new oil and gas expansion from 2025 to 2035.
The production gap also poses practical risks too. Persisting with the forecast levels of extraction while the new low-carbon system is being built risks stranding fossil fuel assets, destabilizing financial systems and regional economies, and undermining the very capacity of governments to invest in and coordinate the new low-carbon system. There is an estimated $1.4 trillion worth of oil and gas assets at risk of being stranded. Given the expansion of fossil fuel production — including coal — stranded asset risk could hit $2.28 trillion by 2040.
Second, and perhaps most significantly, the maxim of “build now, break later” seeks to bypass the unavoidable task of challenging the fossil fuel industry. Fossil fuel incumbents are digging in their heels to resist the energy transition, keep economies hooked on fossil fuels, and, in the process, maintain their profits. Time and time again, and from the very start of the climate negotiations, the fossil fuel industry has sought to discredit the viability of a low-carbon energy system and delay and derail the ambitious climate policy that would help build this new system.
Many representatives of the fossil fuel industry will descend on COP30 to broker deals and talk up their companies’ ambitions to support the energy transition. But the numbers do not stack up: profits remain high, investments in clean energy minimal, and obstruction as fierce as ever. Recent studies show many major oil and gas companies are set to expand fossil fuel production, despite stated commitments of net zero. Even if governments and businesses build the new low-carbon system at the requisite pace, the idea that the fossil fuel industry will voluntarily surrender its market power runs counter to over a century of history. It will not willingly budge. It needs to be pushed.
Moreover, delaying the dismantling of fossil fuel systems underestimates their scale and complexity. Many of these industrial systems are sprawling networks of infrastructures, built over centuries, that span the globe and are subject to volatile global markets. These systems were created with only expansion in mind. Given the power fossil fuel industries have acquired, questions of “breaking” — the decommissioning and early retirement of fossil fuel assets — are perpetually kicked into the long grass, helping to explain why we continue to fail to bend the emissions curve.
Take the UK’s North Sea, for example. This hydrocarbon basin is one of the most explored on earth, and production is declining. Its complex network of platforms, pipelines, and industrial hubs is highly integrated, with one asset impacting the operation of another. Dismantling this network of infrastructure in a way that does not disrupt livelihoods, commodity flows, and regional economies will require careful planning and sequencing —and it should begin now, not later.
Third, there are economic and industrial opportunities to be grasped from addressing questions of managed decline now alongside support for renewable energy. Decommissioning requires a whole industry — fleets of specialized ships, technical expertise, and industrial clusters that can recycle and process the component parts of the fossil fuel infrastructure. This industry is currently lacking in capacity, and scaling it up will create good jobs and opportunities for regional renewal. In recent years, for example, the UK decommissioning sector has developed world-leading competitiveness and expertise, with UK suppliers in line to receive 70 percent of planned work in Supply Chain Action Plans lodged with the North Sea Transition Authority in 2022. By breaking now, there are opportunities for first movers.
How the new interacts with the old is also important. Workers that are currently employed in the fossil fuel sector need a clear and supported path into jobs in the low-carbon energy system as part of a just transition. Many of these workers have the skills and the desire to transition — but are waiting on guarantees and guidance from governments. These workers are crucial to building the new energy system, and creating a path for them into these emergent industries, rather than leaving them to the whims of the market, is critical.
We cannot build our way out of the climate crisis while the systems that created the crisis keep running. Building the new and breaking the old must proceed together — deliberately, rapidly, and democratically. To postpone the hard work of phasing out fossil fuels is to gamble on a “later” that our warming world may not grant us.
About the Authors: Freddie Daley and Peter Newell
Freddie Daley is a researcher at the University of Sussex working on the SUS POL project.
Peter Newell is Professor of International Relations at the University of Sussex UK and leads the SUS POL project on supply-side climate policies.
Image: Shutterstock/T. Schneider
