Notwithstanding the fact that the Pope, Putin and President Xi’s private jets will not be touching down at Glasgow International Airport, the summit will see world leaders and delegates from almost two-hundred territories meet to tackle what has arguably become one of the most salient issues for the global community, climate change.
As kids, many of us envisioned being a hero and saving the day. Unfortunately, the closest many of us will get is by dressing up in wacky superhero costumes for Halloween, but for a select few with the resources of a nation behind them, they are being called on to make decisions that will affect all future generations. Just over 30 years ago, in a landmark speech before the U.S. Senate, Dr. James Hansen, then director of NASA’s Institute for Space Studies, spoke of the cause-and-effect relationship between the greenhouse effect and observed global warming. It was this testimony that made clear the threat posed by climate change and attributed the phenomenon to human exploitation of carbon energy sources.
In the period proceeding this, climate change has slowly been widely accepted as a hallmark issue of our generation, and our responsibility to tackle. One of the most important meetings during this period was the Conference of the Parties 21 (COP 21) in 2015, with the Paris Agreement marking a historic turning point for global climate action, with 195 nations committing to combat climate change and adapt to its impacts. However, since this meeting global climate pledges post the Paris Agreement are drastically off track and could lead to an increase in greenhouse gas emissions of a fifth by 2030 if countries do not raise their ambitions. Unsurprisingly of course, the Paris Climate Agreement was lauded as a significant achievement by its signatories. For example, while French president, François Hollande, said that “This is a major leap for mankind”, David Cameron claimed that “What is so special about [the] deal is that it puts the onus on every country to play its part.” Although, the weight of Mr Cameron’s remarks was significantly diluted by the fact that in June 2017, President Trump announced that the US (the world’s second greatest emitter) would pull out from the agreement. Moreover, even by the UN’s own admission, the targets announced in Paris would result in warming well above 3 degrees by 2100 compared to pre-industrial levels. Indeed, the past six years since the Paris Climate Agreement have been the hottest on record.
Part of the failure of the Paris Climate Agreement can be attributed to the free rider problem and the fact that these pledges disproportionately affect developing countries, with economies such as India not long before signing up doubling its coal production in a bid to develop its economy and reduce poverty. Why if a country can enjoy the benefits of the global effort to limit emissions regardless of their contributions should they limit their growth potential when many developed countries have used the very same methods to grow their economies?
From the point of view of many developing countries, burning fossil fuels is the simplest way to allow for rapid growth in industrial processes, agriculture, and transportation. The fossil fuel energy system is the lifeblood of the modern economy, it powered the industrial revolution and managed to pull millions out of poverty, shaping the modern world as we know it. Indeed, since the industrial revolution, the concentration of atmospheric carbon dioxide climbed from 280 parts per million (ppm) to 412 ppm by 2019 and since 1750 global average temperatures have risen 1°C. The oil and gas industry, which has been a critical part of supplying the backbone of the modern electrical system, face opposition from a public concerned with the environmental impact of fossil fuels, ever-more sceptical shareholders, and challenges from policy makers seeking to simultaneously meet decarbonization goals and expected oil and gas demand. Due to this, the financial and social future of the oil and gas industry has become increasingly in question. To tackle this, the largest five stock market listed oil and gas companies spend $200m a year lobbying to delay, control or block policies to tackle climate change. Their successful lobbying and direct opposition to policy measures to tackle global warming has hindered governments globally in their efforts to implement policies after the Paris agreement to meet climate targets and keep warming below 1.5 degrees.
The importance of reaching an agreement soon cannot be understated, the largest impact of climate change is that it could wipe off up to 18% of GDP off the global economy by 2050 if global temperature rise by 3.2 degrees. The impact of climate change has been forecasted to hit Asian economies the hardest, with a 5.5% hit to GDP in the best-case scenario, and 26.5% in a severe case. China is at risk of losing 24% of its GDP in a severe scenario compared to forecast losses of 10% for the US, Canada, and the UK and 11% for Europe. The Middle East and Africa meanwhile, could see a drop of 4.7% if temperature rises stay below 2 degrees, and 27.6% in the severe case scenario. Data from the Swiss Re Institute’s Climate Economics Index stress tests show that economies in South and Southeast-Asia are the most susceptible to the physical risks associated with global warming. Countries in this region, such as Malaysia, Thailand, India, the Philippines, and Indonesia are those with the least resources to mitigate and adapt to the effects of global warming but also have the most to gain from global efforts to reduce global warming. In comparison, many advanced economies in the northern hemisphere such as the US, Canada, Switzerland, and Germany were among those considered least likely to be significantly affected.
However, the shift towards renewable energy could also come at a social cost, these efforts can help reduce carbon emissions but do so at the expense of increased inequality. In more economically developed countries, ways of incentivizing the shift towards renewable energy is done through means such as tax subsides. This reduces energy costs for homeowners who can afford to install solar panels or energy-efficient appliances, but also serves to drive up prices of fossil fuel energy as utility companies look to recapture losses. This means increased utility bills for the rest of the customers, and for many low-income families, increased financial pressure, which creates energy poverty. In less economically developed countries, decarbonization is often not a priority when compared to economic growth and poverty alleviation. In some cases, renewable energy has been used to alleviate energy poverty, with areas in south-east Asia and sub-Saharan Africa having access to electricity via solar farms giving them electricity when they have historically been unable to, but developing countries still need to implement policies that shift their economies away from carbon-intensive industries.
With all this information, one can see why the UK-hosted COP26 climate summit in Glasgow is greatly anticipated. Aside from showcasing the finest in low-carbon British cuisine (including winter squash lasagne and organic kale pasta), broadly speaking the summit has set four broad aims. Firstly, it will aim to ensure that the target of achieving global net-zero by 2050 can – and will – be realised. Secondly, it will seek to take proactive steps to protect communities and habitats that are most vulnerable to the climate change. Thirdly, it aims to galvanise sufficient financial investment into tackling issues relating to climate change. And finally, it has set the aim of seeking greater multilateralism to cover off these issues.
One specific target that have been proposed for COP26 involves encouraging developed and developing countries to commit to phasing out coal by 2030 and 2040, respectively. However given that the demand for coal is projected to increase by 60% more than all renewables, it is likely that usage will continue to increase before plateauing – and eventually decreasing. Moreover, given that a host of countries are currently experiencing unprecedented energy crises’, this will no doubt have a detrimental impact on the aplite for them to commit to coal use reductions.
Additionally, the failure of the Paris Agreement has been compounded by the admission from wealthy countries that they had failed to deliver on their promise to provide $100bn of climate finance by 2020, with the reality of meeting this goal, that was a central element of the Paris accord, being pushed back to 2023 instead. This admission ahead of the meeting is likely to make negotiations even more challenging as developing countries say they need more financial support from rich countries to enact their climate goals. Boris Johnson has played down expectations of any breakthrough at the upcoming COP26 summit stating it was “touch and go” whether COP26 would be successful.
Despite the incredibly disquieting data, not all hope is lost. Indeed, coming into COP26, around 70% of the world’s economy is now committed to reaching net zero emissions, with 63% of global emissions now being covered by these goals. Even in the last few days for instance, Saudi Arabia has committed to net zero emissions by 2060 with Crown Prince Mohammed bin Salman pledging to invest some $180bn in order to achieve the target.
Hence, there is the potential for COP26 to achieve a global commitment to net zero by 2050. In the roadmap put out by the International Energy Agency, one can find a good roadmap to achieving this seemingly impossible goal. The overarching importance of COP26 is to turn the world to a net-zero-by-2050 trajectory. Of the utmost importance to this is getting China on board as the country accounts for some 25% of the world’s emissions (compared to the US’s 12% and the EU+UK’s 8%). The world’s largest polluter – which released 10,065 million tons of CO2 released in 2019 – has the capacity to reach net zero by 2050 due to its unique position as the key provider of all the key technologies needed: zero-carbon power, long distance transmission, EVs and the hydrogen economy. When it comes to oil and gas, the IEA’s report makes it clear that we have more than enough substitutes, renewable energy costs are already close to parity with fossil fuels and in some cases better. Jeffrey Sachs in an interview with the Financial Times states that he sees “no back-breaking costs or financial barriers, no profound technological barriers that cannot be straightened out.” In this interview he highlighted the fact that whilst we need to decarbonize energy, we also need more of it as the global economy grows and that the shift towards net zero does not need to come at the cost of economic growth, as aside from the green transformation the digital transformation is going to make a profound impact on the way society function, as it provides members of society greater ability to live flexible, enriched lives.
The biggest barrier to overcome are those within the social and political realms. We will be unable to make the green transition without social inclusion and sustainable development. If societies are deeply divided, they will not be able to carry out any coherent transformations of any kind, there must be a multilateral effort across countries to work together and put aside long-standing differences to establish greater political cohesion so that they can focus inwards on the deep polarization we are seeing within many countries. The ‘us versus them’ mentality, which has increasingly seen political traction in the case of relationship between China and the US, only serves to increase polarization and limit global efforts to unify and tackle a problem that is on a global scale, impossible to solve alone. Highly polarized and unequal societies cannot function in this world, it is only countries that are committed to social and multilateral inclusion that are able to do the kind of things needed for the broader common good. Put simply, a Halloween costume party is going to turn out badly if only one person dresses up.