From Promise to Reality

Ten years from now, we will look back at the COP26 summit as an inflection point in our transformation to an economy that values health and resilience over pollution and deforestation.

The Glasgow Climate Pact did not do enough to set the world on course to limit global warming to 1.5°C. But it does keep that prospect within reach. And it’s thanks to a new convergence of businesses, investors, cities, regions and countries. They understand the need to halve emissions, build resilience and end biodiversity loss within the 2020s and are increasingly confident in our ability to collectively drive exponential rates of change.

We saw a number of examples of that convergence on display in Glasgow last month.?

In the?push to end deforestation,?141 countries covering 91% of forests?agreed ?to halt and reverse forest loss and land degradation by 2030. This is?backed by ?nearly ￡14 billion in public and private finance, plus new tools and initiatives announced in parallel.

Thirty-three financial institutions, with US$8.7 trillion in assets under management, committed to tackle deforestation driven by agricultural commodities by 2025. A new?online investment platform ?provides a first-of-its kind guidance system to help institutional investors allocate capital towards nature-based solutions. The?Regen10 ?initiative will work with 500 million farmers to ensure that by 2030, over half the world’s food is produced sustainably and financed with US$60 billion per year.?

In?finance for the race to zero emissions and resilience, membership of the?Glasgow Financial Alliance for Net Zero ?now covers US$130 trillion in assets under management - all committed to reach net zero emissions by 2050.

Additional initiatives will direct investment towards resilience as well as emission reductions. The new?Global Resilience Index ?helps measure the resilience of countries, companies and supply chains in developing and emerging economies. The?International Sustainability Standards Board ?will create a baseline for high-quality sustainability disclosure standards in the public interest. The Scottish government’s?￡2 million ?(US$2.6 million) contribution to addressing loss and damage, meanwhile, was quickly backed with US $3 million ?from philanthropies.

And a host of commitments to accelerate e-bus deployment in Latin America, renewable energy investment in the Caribbean and land restoration in Africa should prove to be the beginning of a wave of capital being deployed in emerging and developing economies.

Figuring out how to create the conditions for the trillions of dollars needed to drive a resilient zero-carbon transition in these markets will be the intellectual challenge of the decade - the delivery of the much vaunted and a much needed green recovery plan.?

Barbados Prime Minister Mia Motley called for US$500 billion of additional special drawing rights in her opening speech. Other potential solutions include long-term or even perpetual bonds as issued previously in wartime, debt-for-nature swaps and catastrophe clauses in multilateral loans to create more fiscal space for vulnerable economies, and a deeper and wider application of insurance products.

Make it Credible

That is our immediate challenge for the year and years ahead.

Emotions coming out of Glasgow are raw and trust is understandably on shaky ground. Because while we can see the palpable change already taking hold of the real economy, the trajectory of current policies is still unacceptable - 2.7°C - while all the targets in place and under discussion would lead to 1.8°C, according to Climate Action Tracker.?

Crucially, this optimistic scenario relies on targets being fulfilled on time, and ratcheted up to ensure we don’t go beyond 1.5°C. To do that, we need to ensure that commitments from businesses, investors, cities and regions are robust, credible and based on science, and that progress is consistently reported.?

The?expert panel announced by United Nations Secretary-General António Guterres?during COP26?provides a welcome layer of scrutiny over corporate commitments to net zero emissions. It builds the UN Climate Change High-Level Champions team’s work this past year to enhance the integrity of commitments and establish metrics to measure progress under the UN-backed?Race to Zero ?and?Race to Resilience ?campaigns.

This will remain the core of the Champions’ work in the?next five years , starting with Egypt’s COP27 Presidency. Through it all, we will be guided by the need to protect and improve human health and resilience. As the?Secretary-General ?said, “Protecting countries from climate disaster is not charity. It is solidarity and enlightened self-interest.”

Enhancing credibility is one of the key elements outlined in the?improved Marrakech Partnership for Global Climate Action for enhancing ambition, which was welcomed by Parties at COP 26 as part of the Glasglow Climate Pact and included?strong statements?during the Global Climate Action High-Level Event. The Champions aim to rapidly implement this 5-year plan and boost climate ambition from all stakeholders and accelerate the delivery of credible and immediate action.

At COP 26, Parties also encouraged the High-Level Champions to support the?effective participation of non-Party stakeholders in the global stocktake. Supporting the global stocktake will be a main priority of the Champions, in particular, helping stakeholders in developing countries and at the regional level to impactfully contribute and highlight opportunities and evidence of enhanced and credible action.

In Case You Missed It

• Renewable electricity capacity will rise by more than 60% between 2020 and 2026?to equal the current capacity of fossil fuel and nuclear power combined, the?International Energy Agency has forecast. The growth of renewables is expected to be 50% higher than it was between 2015 and 2020, driven by government policies and clean energy targets announced around COP26. That’s exponential change in motion.
• Three big European power companies have raised their 2030 targets.?Enel ?aims to have 154GW of renewable and battery storage capacity in place by then, up from 145GW, and has brought its net zero target forward to 2040, from 2050.?SSE?has cut its targeted Scope 1 and 2 emissions for 2030 to about half of what it previously planned, while trebling renewables output.?RWE ?aims to add 2.5GW of renewables capacity per year out to 2030, up from a previously planned 1.5GW.??
• The?Panama Canal Authority’s new?Green Vessel Classification system?will include a fee for greenhouse gas emissions, helping to accelerate the shift to cleaner shipping. The system will classify ships based on their energy efficiency.
• Germany will move up its coal phaseout “ideally” to 2030, from 2038, under a?coalition government agreement . It also aims to end gas-fired power by 2040. Meanwhile,?Portugal shuttered its?last coal-fired power plant ?nine years before its 2030 phaseout date.?
• Nigeria has become the first major developing economy to commit to?set annual carbon budgets ?in line with a new goal for net zero emissions by 2060. Africa’s biggest oil producer will also set five-year carbon budgets and set up a climate change committee, through a law modelled on the UK’s 2008 Climate Change Act.
• IKEA intends to?phase out plastics ?in consumer packaging by 2028. This will require engineering of new solutions and collaboration with product development teams and suppliers.

For more news from across the Race to Zero and Race to Resilience communities, check out?racetozero.unfccc.int .

Mark Your Calendars

• Water in the State and Trends in Adaptation 2021 Report: Africa - Water Adaptation Community webinar :?15 December
• Economic and Social Council Informal Briefing on the outcomes of COP26 : 15 December
• UNDP: A World after COP26: Key takeaways and what is next? : 15 December
• World Economic Forum in Davos : 17-21 January
• Gobeshona International Conference on Research into Action : 20-24 January
• World Wetlands Day : 2 February
• Middle East and North Africa Regional Climate Week : 28 February-3 March
• UN Environment Assembl y: 28 February-2 March