This meeting is not like the previous ones. Time is running out and our leaders need to act now.

First the generalities. The conference is the 26th Conference of the Parties (COP) to the United Nations Framework Convention on Climate Change and the third meeting of the parties to the Paris Agreement. It is held in Glasgow, Scotland, United Kingdom, between 31st October and 12th November 2021, under the co-presidency of the United Kingdom and Italy. This is the first time that parties are expected to commit to a new increased level of removal of greenhouse gas (GHG) emissions since the Paris Agreement. However, as Nordhaus points out, the carbon intensity (emissions divided by gross national product) has remained rather constant in the last thirty years, showing a decrease of 1.8 percent per year despite all the climate agreements including that of Paris.1 As the world GDP is growing, carbon emissions have been increasing by around 2.5 percent annually. The latest Emission Gap Report states:

Climate action so far has been characterized by weak promises, not yet delivered. As the report shows the updated contributions (NDC) under the Paris Agreement fall into the same trap. These pledges only take 7.5 percent off predicted 2030 emissions, compared to the previous round of commitments. Reductions of 30 percent are needed to stay on the least-cost pathway for 20C and 55 percent for 1.50C. If nations only implement unconditional NDCs as they stand, we are likely to hit global warming of about 2.70C by the end of the century.2

Among the most high-profile and influential attendees are US President Joe Biden, Turkish President Recep Tayyip Erdoğan, climate activist Greta Thunberg, Canadian Prime Minister Justin Trudeau and the Duke and Duchess of Cambridge. Chinese leader Xi Jinping announced he would not be attending the conference in person. This makes reaching a deal with China, the world’s largest emitter of greenhouse gas, more problematic.

The goals of the COP263 are:

  1. Secure global net zero carbon emissions by mid-century and to keep 1.5 degrees within reach.
  2. Adapt to protect communities and natural habitats. The climate is already changing, and it will continue to change even as we reduce emissions, with devastating effects.
  3. Mobilize finance. To deliver on the first two goals, developed countries must make good on their promise to mobilize at least $100 billion US dollars in climate finance per year by 2020.
  4. Work together to deliver. At COP26 we must finalize the Paris Rulebook (the detailed rules that make the Paris Agreement operational) and accelerate action to tackle the climate crisis through collaboration between governments, businesses and civil society.

The first objective is critical and “the world has to wake up to the imminent peril we face as a species,” Inger Andersen, the executive director of the United Nations Environment Program, said:

To stand a chance of limiting global warming to 1.5 degrees Celsius, we have eight years to almost halve greenhouse gas emissions: eight years to make the plans, put in place the policies, implement them and ultimately deliver the cuts. The clock is ticking loudly.

(Inger Andersen)

The present level of commitments would drastically increase heat waves, droughts, flooding and wildfires across the globe in the years to come, scientists have warned. The United Nations Secretary-General António Guterres recently called such an outcome “catastrophic.”4

Thus, the first interpretation of COP26 results will depend on how near the voluntary commitments come to the 20C and 1.50C goals. This is the hard decision: anything less than the 20C goal is inadequate.

The major problem with actually realizing this goal is that of the free-rider, the country or countries who make less of a contribution in the reduction of GHG and take advantage of the work of the others that meet their contribution. If there are mechanisms with the new agreement for penalizing free-riders, this would be the sign of a major success of COP26. These may include trade tariff measures for countries that do not adhere to agreed-upon commitments. Side agreements on a sectoral or technological basis, where there is a higher degree of trust between members, also would be an indication of real leadership.

The second objective (adaptation) depends on the degree of success of the first (mitigation): the more effective the mitigation, the less required the adaptation. The problem is that the climate change devastation occurs even at present levels of carbon dioxide accumulation and occurs primarily and earliest in the developing countries. It is in their interest to limit emissions, but it is not clear that COP26 is going to be a truly collaborative effort, with the developed nations failing to raise the $100 billion US dollars promised. It appears that the developing countries are skeptical and our leaders must take responsibility for rectifying the situation.

The third objective of mobilizing finance is the prerequisite for the first two. Here the public and private means of finance should be involved. Many in the private financial sector see climate change as a risk, requiring action that must be taken and reported publicly by the individual company, given the success of the Task Force on Climate-related Financial Disclosures (TCFD). It is in moral and economic interests to step-up and actively take part, rather than view the COP26 operation as a fight between political parties or between fossil fuel companies and the rest. Climate change costs are increasing exponentially. It does not pay private or public finance to dilly-dally. The private financial industry could play a much more incisive role, particularly utilizing the capital of the pension funds.5 Public financing is necessary for areas of infrastructure and much needed long-term research for climate improvements.

Maximum international collaboration, the fourth goal, could be shown if the international community would agree on a gradual increase in the price of carbon removal. The average global cost is now about $2 dollars per ton. We forget that each year, from 7 to 8 million persons prematurely die from air pollution caused by fossil fuels. The corona virus 19 pandemic, by comparison, resulted in four million deaths in total, not annually. This health cost plus the cost of climate damage brings the correct price of carbon removal nearer to $50 dollars per ton. The fact that the developed nations have chosen to ignore this cost is one of the major obstacles to the correct functioning of the economy. It is time to rectify the situation and introduce a global schedule for raising the price of removal of carbon emissions. All the other investment measures in objective number three will benefit. Energy efficiency becomes more remunerative and renewable energy sources become more competitive with fossil fuels. Only strong and enlightened leadership can make this happen.

References

1 Nordhaus, William, 2021, Why Climate Policy Has Failed, October 12, Foreign Affairs.
2 United Nations Environment Programme (2021). Emissions Gap Report 2021: The Heat Is On – A World of Climate Promises Not Yet Delivered Nairobi.
3 UK Presidency (2021), COP26 Goals.
4 Plumer, B.(2021), Latest National Climate Plans Still Fall Far Short, U.N. Report Warns, October 26, The New York Times.
5 Mebane, W. (2021), Whatever It Takes 10 October 2021, Wall Street International Magazine.