Two days that changed the climate agenda: From only reducing emissions to also delivering the solutions needed

23rd May 2018: Framework for assessing avoided emissions by Mission Innovation

24th of May 2018: Positive-carbon impact benchmarks: European Commission

This is probably too complicated for a LinkedIn article, but for those interested in structural change and support for tomorrows winners, here is information about two quantum leaps that I have not seen discussed much. 

I would argue that something quite remarkable happened a few weeks ago. Within two days, 23rd -24th of May, the international climate agenda shifted. Two major processes moved from a problem approach to a solution approach. Not only in word (we have seen that for a few years now) but in structures, tools and mechanisms.

For a long time climate change has been seen as a risk issue and focus has been on big polluters that shall reduce their emissions. A whole industry has been developed around this. From serious reporting frameworks and reduction targets, to less serious initiatives with offsetting and green PR. 

To quote the draft Mission Innovation framework for avoided emissions that will become public after the summer (let me know if you want me to send a copy when it is ready, or if you want to read an early draft)

”To accelerate emission reductions companies cannot only be driven by cost and risk reductions, but must also use their capacity for innovation to deliver the solutions that we need. Hence, solutions providers need the tools and credibility to be able to demonstrate their positive impacts in society. It is not sufficient to just allow polluting companies to show how they reduce their emissions, governments need to be able to direct support to providers of solutions in a cost-efficient way (most GHG emissions reduction for the buck). Investors need to be able to identify winners in a low/zero-carbon economy (not just avoid the losers). This will require a shift in emphasis from “doing less bad” to “doing more good”, but will also need tools and methods to quantify and compare the impact of different solutions and potential solutions.”

 Now we are finally getting frameworks that allow us to provide carrots to support the companies that delivers the solutions we need.

This is from the Mission Innovation Action plan adopted the 23rd of May in Malm?: “MI will launch a framework to support investors and funders to identify those system solutions and technologies that have significant ability, or potential, to contribute to reduced greenhouse gas emissions in society, so called avoided emissions.“

This is from the press release by the European Commissions the 24th of May: Sustainable finance: Making the financial sector a powerful actor in fighting climate change.

“The proposed rules will create a new category of benchmarks, comprising the low-carbon benchmark or "decarbonised" version of standard indices and the positive-carbon impact benchmarks. This new market standard should reflect companies' carbon footprint and give investors greater information on an investment portfolio's carbon footprint. While the low-carbon benchmark would be based on a standard 'decarbonising' benchmark, the positive-carbon impact benchmark would allow an investment portfolio to be better aligned with the Paris agreement objective of limiting global warming to below 2° C.”

It is now much more likely that we will see a major shift away from incremental improvements in unsustainable systems to the disruptive solutions that are capable of delivering what we actually need the next two-five years.