Moving Beyond Oil and Gas: What can we learn from States in the Commonwealth?

Abstract

It has long been understood that the climate crisis has different implications for low and medium-income countries than for others. Within this grouping of more than a hundred independent states, many for whom any transition beyond fossil fuels will be very difficult. This Research Insight focuses on one group of states that are committed to making commitments under the Paris Agreement and which have a history of cooperation, loosely as members of the Commonwealth, and asks if there are lessons to be learned from their initial steps to move beyond oil and gas dependence. If there are, they could be given some support from within that grouping of states.

Out of 54 states that are members of the Commonwealth, no less than 23 have a material stake in oil and gas development. A few of these are high-income states, while most fall into the other categories. Petroleum remains a key driver of broader economic development in this group, with export success dependent upon available geology, the level of international prices obtained in the marketplace, geographical location and quality of governance. Each of these states is now constructing a pathway to an energy transition that reflects its own circumstances.

This Research Insight examines five states within this grouping of petroleumdependent states, each with widely different economic circumstances but committed to making Nationally Determined Contributions (NDCs) under the Paris Agreement. All five – Bangladesh, Cameroon, Pakistan, Trinidad and Tobago, and the UK - are heavily reliant on fossil fuels for the majority of their current energy needs.

Our general findings show:

• a reluctance to divest from fossil fuels, with governments citing their varying energy demands, development needs, and capabilities; • the importance of nuclear energy as a possible part of the solution among several states that have embarked on measures of ‘energy transition’. Of the five case study countries, a majority (namely the UK, Pakistan and Bangladesh) all have either existing or planned electricity capacity from nuclear generation; in the case of both the UK and Pakistan, this is from their existing, and producing, civil nuclear fleet; • a broad acceptance of a transition to renewable energy in terms of policy commitment, alongside a revealed developing world policy choice, amongst the case studies examined, to both increase their levels of petroleum extraction where possible, and to continue to utilize natural gas domestically; and • without sufficient, timely, financial support and technical advice, states in this grouping are unlikely to make significant progress in a transition from hydrocarbons as a vehicle for economic growth to one that is sustainable and fair.