Read a transcript of the conversation between podcast host Akshat Rathi and Jennifer Morgan, Germany’s special envoy for climate.
(Bloomberg) — As Germany’s climate envoy, Jennifer Morgan stands alongside John Kerry of the US and Xie Zhenhua of China as one of the world’s top climate negotiators. But she is no typical bureaucrat. Morgan considers herself an “activist diplomat” — before taking on her current role, she headed up Greenpeace. For Episode 27 of the Zero podcast, Bloomberg Green’s Akshat Rathi sat down with Morgan at the World Economic Forum in Davos to ask her whether the EU needs to compete more aggressively with the US on climate tech, how Germany is justifying the expansion of its coal mines and why reforming the World Bank is vital for helping developing countries deal with climate impacts.
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Akshat Rathi 0:00
Welcome to Zero, I’m Akshat Rathi. This week: more coal, less gas and the same old energy crisis.
Akshat Rathi 0:19
My guest today is Jennifer Morgan, Germany’s special envoy for climate change. In the world of climate diplomats, she stands alongside John Kerry of the US and Xie Zhenhua of China as one of the most important figures. Germany is the world’s fourth largest economy, and the largest economy and emitter in Europe. When she was appointed as the country’s first climate envoy in March last year, Jennifer became the face of Germany’s international climate negotiations. She has a unique background. From 2016 to 2022, she was the leader of Greenpeace, an organization known for its environmental stunts and political pressure campaigns. They’ve disrupted oil drilling off the coast of Greenland, blocked Russian whaling ships, and scaled Toronto’s CN tower. Now she has moved into government and inherited a mess. After decades of cultivating deeper economic ties with Russia through energy imports and hoping it would create a more peaceful world, Germany has been proven wrong. Alongside invading Ukraine, Russia exploited Germany’s over-reliance on gas and turned energy into a weapon.
News montage 1:28
Denmark, Poland and Sweden say they believe leaks in two major Russian gas pipelines to Europe are the result of sabotage. // Germany’s Chancellor Olaf Scholtz has unveiled a €200 billion euro plan to guard the German economy against the effects of soaring energy prices. // In this hardware store near Berlin, they’re already getting ready for the cold season. Customers aren’t rushing to buy fans, but anything that will keep them warm this winter.
Akshat Rathi 1:54
Germany is now in a very difficult position. It has been forced to rapidly wean itself off Russian gas and find replacements to keep its manufacturing economy going. Before the war, Russia provided Germany with 52% of its gas. Since September, it provides none. This has come at enormous cost to German citizens and the planet. Germany has had to pay through the nose for imports of LNG — outcompeting poorer nations. It has built new LNG terminals, and reopened enough coal plants to power 5 million homes. Many are not happy. Protests erupted in January near Dusseldorf around the expansion of a coal mine that produces lignite, the dirtiest form of coal. Greta Thunberg was briefly detained when she joined the demonstrations.This is all playing in the background as Jennifer pursues delicate climate negotiations. I sat down with her at the World Economic Forum in Davos to ask whether the war has put a dent in Germany’s climate ambitions, how the country can continue to play a role as a climate leader while increasing coal use and if trade tensions with the US are spurring more climate competition.
Akshat Rathi 3:14
Jennifer, welcome to the show.
Jennifer Morgan 3:16
Thanks. Great to be here.
Akshat Rathi 3:17
You are now Germany’s special envoy on climate. But immediately before taking on this role, you were the head of Greenpeace. You were an activist, now you’re a diplomat. How has it been moving from one to the other? And how does what you did as an activist feed into your work as a climate envoy?
Jennifer Morgan 3:33
Well, I guess I consider myself — and many other diplomats — activist diplomats. Because what you learn when you are working as an activist, or as a campaign at an NGO, you learn how to have clear goals, you learn how to communicate, you learn how to build coalitions, and all of those things are incredibly important, also, as a climate envoy.
Akshat Rathi 3:53
When you took on the role, Germany was at a moment of transition. It had elected a new government, which had the Green Party as a partner. And just before getting into government, it had set a 2045 net zero goal. But of course, in the last 12 months, things have changed drastically, and that’s because of the war. Since the war began, Germany has built new LNG facilities, revived coal facilities that were due to be shut down and is paying incredibly high prices for the gas that it is importing — outcompeting many poorer nations who can’t afford that gas anymore. So how can you continue to argue that Germany is a leader on climate action?
Jennifer Morgan 4:29
Because there’s a whole other part of the story. And that story is the largest piece of energy legislation in the history of Germany that is scaling up renewables to 80% by 2030. That is the continued work, recently in North Rhine-Westphalia, to phase out coal by 2030. That is a climate law that is binding that will keep us to all of those targets. And there is also the fact that we have phased out Russian fossil fuels — 55% of German gas imports were from Russia. And that we will, in the end, use less gas, and phase it out earlier, than we would have before the Russian war of aggression. So what I understand and see in this new government, in this moment of climate crisis and energy security, is that we’re thinking it together. There have been short-term emergency things that have had to happen, like having coal in reserve, if needed, to get us through the winter. And those have been painful decisions to make. But they don’t question our climate targets. Those are set, they’re legally binding, and the new emissions trading, too, that just has been passed through the European Union, I think will make it even more likely that that can be met earlier.
Akshat Rathi 5:45
As the [former] head of Greenpeace, you know optics matter. One of the things that Greenpeace does well, continues to do well, is organize spectacular protests, which bring the attention of world governments and world media to tell a story that really needs to be told. And at this moment, as we speak, there are protests taking place in Germany against the expansion of a coal mine in Lützerath. Greta Thunberg was detained at the protest and was carried off by police dressed in riot gear. Those images are stunning. First, do you wish you were able to protest with them?
Jennifer Morgan 6:22
Well, I think that thankfully we live in a democratic country where that kind of engagement and peaceful protest is possible, and is a very important part of our national conversation. And I’ve participated in many protests and demonstrations in my time. And I think that the voices of youth in our country in a way demonstrate the seriousness of the situation that we’re in. Their level of desperation, of anger, of wanting things to happen more quickly, is a very legitimate one. And one that we take very seriously.
Akshat Rathi 6:59
Another way to ask that question: What has Germany done since you became an envoy that you would have protested if you were still in your last role at Greenpeace?
Jennifer Morgan 7:08
I mean I’m now in a new role. So like I said, peaceful protest and human rights and democratic systems are fundamental. And in the past, I have been part of that community. Now, I’m very grateful and thankful that I live in a country where that is the case, and those rights for peaceful protest need to be maintained. I think that it’s a challenge we live in right now. We are in a climate crisis. I think the government is working to do everything that it can to phase out coal more quickly, while also dealing with this Russian war of aggression. And that is hard; it is not easy at all. But I think it’s also really important and images do matter about the over 50% of households in Germany that have renewable energy. The fact that we’re moving more quickly than anyone else, and getting those moving and accelerating that pace and scale of change, and then sharing that learning with other countries so that they can learn from the mistakes and the challenges that Germany has had in balancing all of these different things — keeping the climate crisis, and the acceleration of it, as front and center as we possibly can.
Akshat Rathi 8:27
Now, one small move of protest that you did make was last summer. You were critical of Chancellor Schultz when he pushed for the G7 to allow new gas investments globally. How did that go inside the German government?
Jennifer Morgan 8:41
Well the G7 made some decisions, I think again working to try and get clarity on that pledge to not have public funding go to any fossil fuel new fossil fuel developments. You know, we have a robust coalition government in Germany and that means that partners speak with each other and work to find solutions. So it went fine.
Akshat Rathi 9:06
Well, speaking of LNG, though. You said that climate goals remain as they are, both for 2030 and for 2045. However, we also know that when fossil fuel assets are built, there can be a real risk of lock-in. Because capital, once spent, would like its returns. And so, do you fear that the LNG terminals that are being brought in would lead to that kind of lock-in?
Jennifer Morgan 9:35
I think that we have to remain vigilant. That’s not the intent right now, of this government. And the work, not only intent, is also to be accelerating the pace and scale for green hydrogen. To be moving and working with, for example, countries in the Nordic Region — Denmark, Norway, Sweden, etc. — to be scaling up their renewables in order for that infrastructure then to be adapted to that. But we know that we always have to remain vigilant and make sure and have transparency and accountability about what decisions are taken, and making sure that they’re stuck to.
Akshat Rathi 10:14
Coming up to more international matters. The US passed the biggest climate bill — the Inflation Reduction Act last year, and that’s ramped up trade tensions between the US and Europe. European Commission President Ursula von der Leyen said at Davos that the EU should increase funding for cleantech. Should the EU match the level of subsidies that the US is offering to companies investing in clean tech?
Jennifer Morgan 10:34
Look, first of all, it is excellent that the United States has a law that moves forward on renewable energy and on bringing down greenhouse gas emissions, and that is to be welcomed. It’s been a long time coming. And I think that we all have hoped throughout the years that once the US does that, it will move quickly and it will shift things, and I think that’s what’s starting to happen. And so I think what you’re seeing in Europe, and in our discussions also with the United States, which have been good, is how that then can create a race to accelerate the research and development, driving down the cost of the technologies that are needed. What that looks like specifically within Europe, I think that’s what we’ll be working on in the coming months, whether it be around the Raw Materials Act, whether it be around cleantech. But that’s the conversation that we’re having with the US and driving that forward. And I think Europe has incredible assets and vision and opportunity for companies, and for that growth.
Akshat Rathi 11:37
One thing we’ve been hearing here from energy CEOs, from cleantech venture capital funding bodies, is that for them, the US has become so much more attractive A) because it’s the US, and it’s the largest economy, B) that the subsidies are backed by the US government and seen as a completely reliable source of money, and C) that the regulatory nature of the energy industry in general, is much easier to navigate in the US than it is in Europe, which is a market made up of 27 countries. Against those forces, do you see that we are entering an era where there’s going to be more competition for climate solutions than collaboration?
Jennifer Morgan 12:20
I think that there will be both. I think that there will be collaboration: What are the standards that need to be set for socially inclusive, environmentally sound green hydrogen? I think that’s an area that needs to have collaboration to make sure that benefits, if you especially look at not only in developing countries, but indigenous lands, that type of thing. But I also think having a competition to drive things faster, and bigger scale, is not a bad thing. And I think that that’s a very active discussion now in Europe about how we can do that. You know, it’s kind of like, game on. Let’s go. Let’s use this moment in a way to drive things to move faster and bigger.
Akshat Rathi 13:05
The US and Europe were at very different levels, when it came to acting on climate change, only 24 months ago. The US did not have this bill, it was years of dragging its feet to try and reduce emissions. It still consumes a lot of coal, it has a lot of oil and gas reserves in its backyard. And so Europe looked like the place where the transition would happen faster. But now with what has happened with the biggest US climate bill, executives say we’re not so sure because Europe moves slowly. Is there something being done to speed things up to ensure that Europe can compete as cleantech industries grow in other parts of the world?
Jennifer Morgan 13:45
I guess I wouldn’t share your characterization, because I think that Europe, through the Fit for 55 plan, through the emissions trading system that has been in place for many years, through the renewable energy directives that are there, through the driving of emissions targets of at least 55 by 2030, and many other measures, has been setting the standards, and I think is better prepared than others because of the fact that we’re thinking it through on so many different levels. Yes, it’s good to have incentives coming. But incentives alone, is the experience and what’s shown in the literature, are not adequate to drive the types of reductions we need. We are talking about a halving of global emissions in seven years. And for that you need to throw every tool in the toolbox that you have. And there I think that the different European measures that are there and have been tested. In a way it’s a mature debate that has learned a lot already. Can things move faster? Absolutely. And that’s why there was a breakthrough recently with Robert Habeck, minister of economy and climate in Germany, working to have a faster time frame on building wind turbines in Germany. I think we have a lot in Europe that other countries can learn from because we’ve had to accelerate the learning process. You know, we’re in regular dialogue with the US, but we’re also finding that as Germany and Europe as a whole, there’s so much curiosity and interest to work with us from emerging economies. Because we’ve gone through it, because we know what it’s like to have a grid with 45% renewable energy in it, because we’ve had to build up that market, and because we’re also working to keep our energy intensive industries at home. So I think it’s a healthy debate. But I think we know from what scientists tell us and our own experience that you need, actually, a whole number of different tools and policies and measures and incentives as part of that, to be able to address this, also across all sectors.
Akshat Rathi 15:45
After the break, I ask Jennifer how Germany will meet its overseas climate commitments, and whether fossil fuel interests are derailing COP.
Akshat Rathi 16:03
One of the roles that you have as a representative of Germany on the international stage is to stand for Germany’s contribution towards international finance. Germany is supposed to contribute as much as €6 billion each year towards this $100 billion fund. But so far, the government in 2021 spent only €5.3 billion. The gap is small relative to other countries, but it is real. What is it that you are doing to make sure that Germany delivers on its promise?
Jennifer Morgan 16:32
Well, actually we overachieved our target in 2021, because at that point, it was €4 billion. And now the chancellor has made it clear that we want to move to six, and that half of that finance should go to adaptation, as well, which has been a key request of developing countries. What I am doing… To put it in the broader context, meeting the $100 billion is essential, and I worked with Minister Guilbeault from Canada to try and look at, ‘Okay, what more can we be doing on that in the lead up to the COP?’ But what happened, I think, at the COP and across the board, is this recognition of the need for reform of international financial institutions. We have institutions that were built after the secon World War that are no longer fit for purpose. And Germany is working to bring forward proposals into the World Bank and other financial institutions to change that so that issues of the debt crisis, issues of the gaps between rich and poor, the food crisis, the climate crisis, are actually much more central to how those institutions are working. So that’s one area where I’m active, where Germany is active, with partners to try and work that through.
Akshat Rathi 17:44
And how positive are you on that reform? There’s the spring meeting (of the World Bank and IMF) coming up in April. But these are bodies that haven’t changed all that much in a very long time. At COP27, there was a broad agreement where every country signed up to wanting a reform of multilateral development banks, but how positive are you that it will happen, and soon?
Jennifer Morgan 18:03
Well, I’m positive that there is a greater level of attention and understanding of the problem than there has ever been. And I think, therefore, also a greater level of accountability and expectation, and commitment of governments to work towards it. I think we have to work to make sure that it is a transformational change, not just an incremental change. And that is a conversation to have with our partners around the world. Because it only works when we all come together with that vision. As we move forward in these just-transitions that need to occur around the world — whether it be in the energy sector, in the agricultural sector — matching those transitions with the financing packages, and the financing tools that are required is absolutely fundamental. And so I think it’s a moment. And I think it comes from the fact of the COVID pandemic and the dire situation of so many developing countries, that it’s no longer possible to look away.
Akshat Rathi 19:03
Sticking to COP27. You had the loss and damage fund agreed upon but there’s no sum attached to it. Do you see actual numbers this year at COP28?
Jennifer Morgan 19:12
First of all, I think it was a major breakthrough for the most vulnerable countries that, after 30 years, their demand was met. And I think that the European Union played an important role in meeting that hand that was reached out and asked for. And so now we have to get that fund as part of a bigger mosaic — we can’t forget the mosaic. What that means is yes, there needs to be and will be a fund for loss and damage, but actually the commitment was bigger than that. The commitment was to look at all the different financial institutions in that mosaic or ecosystem to make sure that there is coverage for loss and damage across the board. And so I think this year, the commitment was to get that moving, to get that fund established. And then I think the big question of who pays is also a big part of that question. I mean, it was quite clear from the COP conclusions that it’s not only industrialized countries, and it’s not only countries. It’s clear that developed countries need to play a leading role, but working that through is a big part of the negotiation, as well. So whether there’ll be numbers by the end of this year, I’m not sure, I think we need to see what the fund looks like. But certainly, I mean, Germany, as of January, the Global Shield is up and running, which was an initiative with the Vulnerable 20. So there is a lot happening already.
Akshat Rathi 20:36
You said not countries. Are you thinking of private institutions contributing?
Jennifer Morgan 20:41
Well, I think there’s different ideas that have been kind of put out there for sources. The secretary general has suggested a windfall profit tax on fossil fuel companies. Prime Minister Motley has also put out some ideas on that. There are older ideas that have been out there forever, about Tobin taxes and financial transactions and all of these different things. There’s advocates looking at private jet tax. So I don’t know what it is, but it’s clear that if you look at the damages… we haven’t really talked about why we’re doing all of this. I mean, the climate crisis is ravaging through countries, and the costs are immense. They are immense. And so both getting the intergovernmental and the accountability moving through these types of funds is important. But then also looking at how they can be filled.
Akshat Rathi 21:30
COP27 happened in Egypt, a fossil fuel exporter. COP28 will happen in the United Arab Emirates, a big fossil fuel exporter. The head of COP28 is the head of the state oil company. Will two years of fossil fuel-friendly COP presidencies delay climate action?
Jennifer Morgan 21:47
Well, I mean, I think it’s clear that COP28 has to have a focus on emissions reductions and mitigation, as we say, because we know we have seven years to halve global emissions. And I think that the COP President understands that. He understands the science and has an immense opportunity to be driving things in the direction that is needed. Has a tremendous opportunity to have a very inclusive COP, with civil society, experts and business contributing to that. And that’s how we will engage with them. Really at the end of the day, each of these COP presidencies are looked at and judged by the outcomes that come at the end. And so we’re working for a COP where we have a major shift on the just-transition and the phase out of fossil fuels and scale up of renewables, a set of finance outcomes. Adaptation, of course, as well.
Akshat Rathi 22:43
If we just look at the last few hours at COP27. There was the loss of damage fund on the one side, which was a progress that every party wanted. And then there was a demand from the EU and other progressive countries that that be met with mitigation language in the text. But in the end, because the loss and damage fund was so important, the EU had to tone down or walk away from its resistance. We didn’t even really get a statement at the very end. What happened?
Jennifer Morgan 23:12
EU Executive Vice-President Timmermans spoke as well, at the end. And he said that the EU had made the decision to support the full COP and not walk away from it, because we understood how important this loss and damage fund was for the most vulnerable countries, and this fund needs to be for those most vulnerable countries. And that we were unsatisfied with the results on mitigation. And that to me puts additional pressure on COP28 to fill that gap. Sure, we maintained the 1.5C goal and the types of emission reductions that are needed in the text. Yes, there is new language for renewable energy in that text. But what we need this year is — on fossil fuels — stronger language matched with the finance reforms that are needed so that countries can phase out while providing and having prosperity for their people and taking care of the planet at the same time. It’s a tall order, but we have no choice. I mean, look, the planet is on fire, the poorest are suffering immensely. I think that the incoming COP presidency understands that and will count on them to drive us forward in a way that we can all feel like we got the whole thing at the end.
Akshat Rathi 24:36
Thank you very much for this conversation.
Jennifer Morgan 24:37
You’re very welcome.
Akshat Rathi 25:00
A climate envoy’s role is never easy, having to balance short-term political realities with the long-term need to reduce emissions. Jennifer’s position is harder because of the geopolitical shock Germany has faced over the last year. While she didn’t answer many of my questions directly, it was a great insight on how she is playing the balancing act.
Thanks for listening to Zero. If you like this episode, please take a moment to rate and review the show on Apple Podcasts or Spotify. Send it to a friend or write it into legislation. If you’ve got a suggestion for a guest or topic or something you just want us to look into, get in touch at zeropod@bloomberg.net.
Zero’s producer is Oscar Boyd and senior producer is Christine Driscoll. Our theme music is composed by Wonderly. Special thanks to Laura Millan, John Ainger, Petra Sorge, Olivia Rudgard and Kira Bindrim. I’m Akshat Rathi, back next week.
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