Cutting through the COP – 18 November 2021
COP26 has now ended, however from the start of next year Instinctif Partners will be issuing a monthly bulletin looking at the latest energy and environment news. This will include news and insight on how the pledges made during COP26 are translating into action. If you are interested in signing up to the bulletin, please email James.Nason@instinctif.com. Prior to this we now look back at COP26 to assess its impact and potential legacy.
A climate success or ‘Flop 26’? What was agreed in Glasgow?
After 14 days of negotiation, last Saturday COP26 came to an end. During the closing session of the summit, a at times emotional COP26 President Alok Sharma MP announced that the Glasgow Climate Pact had been agreed. While Sharma said that a “historic agreement” had been reached, he also reflected that it was a “fragile win”. But what was agreed in Glasgow? Did the UK Government successfully manage to secure the agreements required on Coal, Cars, Cash and Trees to limit global warming to 1.5C? Or was the Conference ultimately a load of hot air?
While the Prime Minister said that the COP26 agreement sounded “the death knell for coal power“, coal was one of the major sticking points throughout the summit. Over 40 nations including heavy coal users, Indonesia, South Korea, Poland, Vietnam, and Chile signed the ‘Global Coal to Green Power’ Transition Statement which committed signatories to achieving a transition away from domestic coal power generation. However major producers and users such as India, China, USA and Australia failed to sign the pledge. Elsewhere, in a side agreement, the US, UK, France, Germany and the EU agreed to fund South Africa to finance a quicker transition from coal.
China and India were also responsible for a last-minute revision to the final agreement text with the countries managing to secure a change in the wording to a commitment to “phase down” coal use rather than “phase out“. While this was criticised by many campaigners, this is the first time that language around reducing coal has been included in a global climate deal.
Verdict: Given the importance of coal to the economies and living standards of developing nations, the agreements reached in Glasgow, were as good as could have realistically been hoped for.
With the UK Government pledging last year to end the sale of new petrol and diesel cars by 2030, securing the global transition to zero emission cars and vans was a key target for the UK. At COP26, 30 countries agreed to work together to make zero emission vehicles the new normal by making them accessible, affordable, and sustainable in all regions by 2030 or sooner. 24 countries and 11 car manufacturers also signed the ‘Route Zero’ pledge which committed signatories to ensuring that all new cars and vans sold by 2040 be zero-emission vehicles (The UK also committed to the slightly later phase out of ICE HGVs during the summit).
Some of the major world’s leading car makers including Ford, General Motors, Mercedes-Benz and Volvo signed the commitment. However, major players such as Volkswagen, Toyota, Renault-Nissan and Hyundai-Kia declined to sign, putting the 2040 target in doubt.
Verdict: The UK secured a significant number of manufacturers and countries to follow its lead in phasing out petrol- and diesel-powered vehicles. The manufacturers who have signed will lead the way in expanding the reach of this deal to those countries who have not signed the agreement.
Activating climate finance to help the poorest nations achieve their climate targets will be key in achieving the 1.5C goal. The final agreement text urges developed countries to urgently and significantly scale up their provision of climate finance, technology transfer and capacity-building, to assist developing nations. Prior to COP26, G7 countries committed new finance towards the $100bn climate finance goal, and a Climate Finance Delivery Plan was published which suggests that the goal will be met in 2023. In terms of private business, COP26 saw the launch of the Glasgow Financial Alliance for Net-Zero, which said its members (450 firms across 45 countries) had committed $130tn towards assisting the net-zero transition.
Verdict: COVID-19 will have inevitably reduced the ability of developed nations to fund projects in other countries. The ability of developed nations to meet this goal in 2023 may depend on the global economic recovery from the pandemic. That said, this is possibly the biggest disappointment to emerge from the summit, as in reality, the promise of money underpins all other commitments.
Over 100 world leaders signed the Glasgow Leaders’ Declaration on Forests and Land Use, which commits nations to ending and reversing deforestation by 2030. Brazil, Russia and China were all signatories to the deal which covers 85% of the world’s forests. Indonesia, an important signatory, has since claimed that the agreement was, “unfair”, raising questions over its future compliance.
28 countries committed to remove deforestation from the global trade of food and other agricultural products such as palm oil, soya and cocoa and 30 of the world’s biggest financial companies – including Aviva, Schroders and Axa – promised to end investment in activities linked to deforestation. The UK Government also launched a £500 million funding package to support the implementation of the Forest, Agriculture and Commodity Trade Roadmap which is intended to help protect five million hectares of rainforests from deforestation.
Verdict: Unlike other areas, the UK managed to secure agreements from those countries in the firing line who had the most to lose. Seen alongside the corporate commitment noted above, the agreements on deforestation should be seen as a success.
Beyond the deal on phasing out petrol and diesel cars and vans, 40 world leaders signed up to several stretching technological targets. These include:
- Clean power to be the most affordable and reliable option for all countries to meet their power needs efficiently by 2030.
- Near-zero emission steel production to be established and growing in every region by 2030.
- Affordable renewable and low carbon hydrogen to be globally available by 2030.
- Climate-resilient, sustainable agriculture to become the most attractive and widely adopted option for farmers everywhere by 2030.
A group of countries backed a goal to reduce emissions by the global maritime sector to zero by 2050, the detail will be agreed by 2023. 105 countries pledged to cut methane emissions by 30% by 2030.
Finally, one of the interesting occurrences during COP26 was the amount of side partnerships and agreements etched. Perhaps the most significant was the agreement between the USA and China, who pledged to co-operate and accelerate action on climate change.
In comparison to other COP meetings, there was a great deal of success. Throughout the two weeks, 47 countries announced new net zero targets and many countries individually pledged to raise their climate ambitions as noted above. For many countries, the commitments they made on tackling fossil fuel use, deforestation and transport emissions were groundbreaking and will, if delivered upon, go a long way to achieving the aim of keeping global warming limited to 1.5C. Importantly the package of action agreed will mean that the 1.5C will not be met.
Countries agreed to return for COP27 in November 2022 in Sharm el-Sheikh, Egypt, with stronger commitments to put the world on track for 1.5°C. Ultimately, the legacy COP26 will be dependent on the domestic implementation of the various commitments and pledges made.