COP27: the window is closing but light shines through…

The United Nations Environment Program report, The Closing Window, makes clear that the climate crisis calls for rapid transformation.?Whereas the Paris Agreement aims to limit global warming to 1.5°C, the best-case scenario points to 1.8°C increase in temperature – and most models are doubly depressing. “Every fraction of a degree matters: to vulnerable communities, to species and ecosystems, and to every one of us.”?This alarm must spur action. Sharing three reasons to remain hopeful.

(1)??Follow the $$$. The energy transition will be expensive but affordable. Turnover is inevitable because the world is constantly replacing airplanes, cars, power plants, and other infrastructure – irrespective of any energy transition. Remember, the green premium is the incremental investment rather than the absolute number. “McKinsey Global Institute estimates that an annual average of 9.2% of GDP must be spent on physical assets to achieve net zero by 2050 but reckons this is an increase of only 0.9 percentage points over current plans.” The economics of decarbonization are not easy but they are achievable.?

(2)??Nature prevails. The new President of Brazil ran on a platform promising to fight deforestation and protect indigenous peoples.?Lula is delivering at COP27 together with the world’s three largest rainforest nations.?Brazil, Indonesia, and Democratic Republic of Congo are launching a partnership on forest preservation. This pact covers more than half the world’s remaining tropical forests – with leadership by the governments themselves. Companies can accelerate global climate finance by investing in carbon markets, especially nature-based solutions. That is why American Express Global Business Travel prioritizes verified carbon credits from REDD+ projects (Reducing Emissions from Degradation and Deforestation) for ourselves and our clients at scale.

(3)??United States (finally) taking action. My country is, ashamedly, the worst historic offender (see below infographic). Draft COP27 text states: “developed countries who have the most capabilities financially and technologically to lead in reducing their emissions continue to fall short in doing so, and are taking inadequate and unambitious goals to achieve net zero emissions by 2050, while they continue to emit and disproportionately consume the global carbon budget.”?Which is true.?But the United States is finally moving in the right direction by:

• rejoining the Paris Agreement;
• passing the record-breaking Inflation Reduction Act with $369B in energy and climate finance;
• tackling methane emissions (a greenhouse gas with a global warming potential 25x carbon);
• catalyzing investment in climate finance with public-private-partnerships, domestic and abroad, especially in adaptation and resilience; and
• accelerating innovation in hard to abate sectors with the Green Shipping Challenge and SAF Grand Challenge (with Amex GBT advancing sustainable aviation fuel via #Avelia in partnership with Shell Aviation, 埃森哲 , Energy Web , Aon , and more).

We are exactly halfway between when the Paris Agreement was signed and 2030, when the world aims to halve global emissions. We are currently not on track. So let's go faster.