Johannes Schumann, Head of the GIZ project "Support of the "green"economy in Kazakhstan and Central Asia"

Dinara Tamabayeva, Public Relations specialist of the GIZ project "Support of the "green" economy in Kazakhstan and Central Asia for low-carbon economic development"

In the early 1990s, the overwhelming majority of scientists came to the general opinion that greenhouse gases played a significant role in most climate changes, namely carbon dioxide emissions from man-caused human activities.

The new understanding was made possible thanks to scientific observations and computer modelling of climate change processes.

But if earlier the topic of climate change was rather a concern of the scientific community, now it has become an integral part of the global agenda, affecting all of humanity, the state of the environment and the biosphere.

Today, we are already witnessing that climate change carries serious physical risks for ecosystems, infrastructure, human life and health, and therefore causes changes in international and national management methods aimed at reducing greenhouse gas emissions. The essence of these changes are economic and political reforms that change economic and financial systems, create prerequisites and risks of transformation for national economies.

Speaking about international efforts to combat climate change, there is no doubt that the Paris Agreement, adopted in December 2015, is a turning point in international climate policy. As you know, the Paris Agreement obliges all countries to take measures to reduce greenhouse gas emissions and strengthen environmental sustainability. The goal of the Paris Agreement is to limit the increase in global temperature levels significantly below 2 °C, preferably to 1.5 °C, compared to pre-industrial levels.

The Republic of Kazakhstan signed the Paris Agreement on August 2, 2016 and ratified it on December 6, 2016, committing itself every five years to submit its climate action plans (nationally determined contributions - NDC) and to prepare a low-carbon development strategy (LCDS), which outlines the long-term planning horizon for NDC and describes thevision of the future national low-carbon development.

DECARBONIZATION is the reduction of greenhouse gas emissions over time in order to keep the growth of the average global temperature at a level significantly below 2 °С compared to the pre-industrial level

The Kazakhstan's NDC assume the following goals to reduce greenhouse gas emissions:

·            Unconditional reduction of GHG emissions by 15% by December 2030 compared to 1990;

·            Reduction of GHG emissions by 25% by December 2030 compared to 1990, subject to additional international investment, access to a low-carbon technology transfer mechanism, funds from the Green Climate Fund and a flexible mechanism for countries with economies in transition.

In this regard, there is a need to carry out serious work and involve international experience in the field of combating climate change. Thus, in order to support the transition to low–carbon development and within the framework ofjoint work of the German Society for International Cooperation and the Ministry of Ecology,

Geology and Natural Resources of the Republic of Kazakhstan, the project "Support of the Green Economy in Kazakhstan and Central Asia for low– carbon Economic Development" was initiated, funded by the Federal Ministry of Environment, Nature Protection and Nuclear Safety of Germany within the framework of the International Climate Initiative (IKI).

The aim of the project is to develop a Strategy for low–carbon development of Kazakhstan, to improve the institutional and technical potential for low–carbon development. This experience will also have a concomitant positive impact on other Central Asian countries.

At the moment, activities on the working draft of the strategy has been completed and work on modeling scenarios for low–carbon development of Kazakhstan has almost been finished.

Global decarbonization trends create both opportunities and risks for Kazakhstan at the same time. For example, the mechanism of border carbon adjustment of carbon products introduced by the European Union contributes to an increase in taxation on products with high emissions and on a decrease in demand.

The international spread of GHG pricing mechanisms, the withdrawal of investments from projects and assets related to fossil fuels – all this is a direct signal of the need to transform all sectors of the economy towards decarbonization, so as not to be left behind the world economy.

Thus, there is a choice between the costs of modernizing production processes to reduce emissions associated with energy production and energy consumption in industry, transport and housing, as well as with industrial processes, agriculture, waste management, and the loss of export income, hence the income of both the private and public sectors. This means that, although international efforts to reduce GHG emissions increase external risks for the economy of Kazakhstan, nevertheless, the new requirements enable the Kazakh industry to receive powerful incentives for investment in decarbonization to maintain its position in international markets.

Decarbonization in all sectors of the economy helps to reduce risks and increase the attractiveness of the economy of Kazakhstan. New opportunities are opening up for the country in the field of attracting "green" finance, the transfer of carbon–free technologies, integration into the global carbon market, the implementation of climate projects under the auspices of the Paris Agreement, as well as participation in new international markets for "green" energy resources, products and innovative technologies.

According to the simulation results, the main contribution to the reduction of GHG emissions will come from the energy sector, since this sector is being their main source. In order to transform such a huge sector of the economy as energy in a country that is economically dependent on the export of its energy carriers, serious costs for deep decarbonization are required. However, adherence to old technologies and economic models could be worth much for the country. International financial institutions and investment companies are redirecting their investments into infrastructure and technologies that correspond to low–carbon development and especially renewable energy, so coal and oil production is rapidly moving into the department of unprofitable assets. In this regard, it becomes especially important to start paying attention to the "correct" investments that can provide both short–term benefits which are: jobs and economic growth; and long–term benefits - decarbonization and increased economic stability.

Currently, coal is the main source of energy in Kazakhstan, while it has the largest carbon footprint. In 1990, coal accounted for 65% of GHG emissions in the energy sector, and in 2017 it still was 59%.

Moreover, during primary energy production (for example, associated gas during oil production and coal bed methane released during coal mining) and during distribution (for example, leaks from pipelines), volatile emissions occur.

Although volatile emissions from the energy sector have been declining in recent years, they still accounted for about 9% of the energy sector's GHG emissions in 2018.     

The transition from steam coal to natural gas will significantly reduce greenhouse gas emissions in the energy sector. Since natural gas is a cleaner fuel with a higher energy content, its combustion produces fewer emissions of almost all types of air pollutants and produces half as much carbon dioxide as when burning coal to produce the same amount of energy. But at the same time, gas is a transition source of energy. Over the longer term the energy system should be based on renewable energy sources and electrification.

Investments in the transition to carbon neutrality not only stimulate GDP growth, but also bring huge benefits for the economy, as well as the social sphere and the environment. For example, environmentally sustainable farming methods not only contribute to reducing GHG emissions, but also help to conserve water resources, reduce soil erosion, increase yields, bring additional income, increase production volumes and reduce the risks of damage from negative weather and climatic factors. Each tenge invested in "green'' development can bring 3 times more income in the form of added value in agriculture.

However, we should not forget that in the process of transferring the national economy to the rails of decarbonization, the main goal is the well–being of the people of Kazakhstan. Therefore, it is important to ensure that an active transition to low–carbon development will not bring economic losses for the population. According to the rules of the Paris Agreement, all countries should be provided with relatively flexible conditions in accordance with their capabilities, which would allow them to fulfill their obligations and report on their implementation consistently and transparently.

For a successful transition to a low–carbon economy, it is important to get the support of various social groups in each state. To do this, it is necessary to share the burden and benefits of actions to reduce GHG emissions on a socially equitable basis and support the population groups that will become vulnerable when decarbonization measures are implemented. The State should provide support to citizens employed in the sectors of the economy related to fossil fuels, while efforts should be made to create high–quality jobs in low– emission industries.

The principle of social justice of transition is one of the guiding principles of the Concept of Low–carbon Development of Kazakhstan until 2050. The Government of Kazakhstan assumes responsibility for ensuring a fair and effective transition to a low–carbon future. The planning of the stages of transformation should be based on the coordination of interests acceptable to the whole society.