The COP21 just ended in Paris with a bold and historic agreement signed by 184 countries. Some experts commenting on the text have presented the agreement as a turning point. Is this the case?
Prior to the start of the conference most countries submitted their voluntary Intended Nationally Determined Contributions (INDCs) to the UN secretariat to show their determination to contribute to reducing the impacts of climate change. An analysis of the INDCs’ cumulative impacts suggests that they come far from aligning with the mandate to keep the Earth warming much below 2ºC by 2100 to limit climate risks. Together, they would lead to a 2.7 – 3ºC warming, an inacceptable number from the scientists’ and the most vulnerable countries’ perspective. The agreement signed on December 12, 2015 doesn’t offer any alternative trajectory to get the world to possibly 1.5ºC, the ambitious target mentioned throughout the document. How can we then state that the Paris agreement is a turning point for humanity and the planet? It is probably by looking outside the agenda for solutions presented in the agreement that emission reductions will be found in the years to come, This is in particular true prior to the reevaluation of the INDCs, reevaluation not planned until 2020. More specifically, it is what happened during COP21 in presentations, discussions and press briefings, and also outside the Le Bourget venue that gives credence to the idea that this agreement might represent a turning point.
The first strong suggestion comes from the renewable energy “revolution” underway that will be expanded by initiatives announced at COP. In 2014, renewable energy investments have been higher than all fossil fuels investments taken together and this both worldwide and in developing countries. Projections made a few years ago in wind and solar energy have been exceeded several times in the recent years and in different countries (e.g., US, China) and the cost is now on a dramatic down curve, particularly for solar, with values as low as 0.387/KWh in Texas. As for the future, it is really bright. A new Goldman Sachs study indicates that much extra energy will be added to the world’s energy economy from solar photovoltaic and on shore wind in the period 2016 -2020. The increment would be as large as all the energy supplies put together from natural gas (mostly “fracked” gas) between 2010 and 2015! But what provides the impetus for the turning point are the several ambitious initiatives unveiled at COP21. For instance, the International Solar Alliance, a coalition of 100 countries led by India that proposes to expand solar energy development around the world, with a focus on the poor and highly populated sun-rich regions. This will mobilize $1 trillion in solar investment and complement India’s own goal to produce 100 GW of solar energy by 2022. The US pledged to double its support for renewable energy R&D to $800M while France announced $2B for the development of renewable energy in Africa.
A second source of emission reduction will be coming from the cities and regions whose mayors and representatives met in Paris and pledged to reduce their overall emissions associated with consumption, develop resilience and increase the share of renewable by 50% by 2050. Large reductions can be expected if they have access to financing.
There are also the multiple financial pledges that are hard to tally without getting into the details of what is already given in the form of aids to some countries. Nevertheless they are significant – of the order of $B80 – and some are noteworthy by their amount. For instance, the international coalition of billionaires, including Microsoft’s Bill Gates, Alibaba’s Jack Ma, and African Rainbow Minerals’ Patrice Motsepe has pledged to channel money cash into clean energy alongside 20 governments, towards clean energy innovation: solar, energy storage, and efficiency.
The strong presence of the financial investment and business sectors was especially remarkable. They came with new engagements and a surprising demand for a carbon price. The conference attendees were mostly those with responsibilities for climate in their respective institutions, the implications being that the COP climate objectives may not have yet registered in much of the market. But there was definitely a strong interest in conveying the message to the larger market that it is time to take climate change seriously and factor it into long-term financial forecasts. Several speakers mentioned the idea of a 2ºC stress test for fossil fuel companies. That is an analysis of the company’s situation under the constraints of a limit of 2ºC temperature increase and the resulting possibility of unusable (stranded) coal, oil and gas assets because of too high prices. Such stress tests are now beginning. Those are particularly important to retirement fund managers whose portfolios represent long-term investments commensurate with the time scale of climate change. And any mistake in their investment can have catastrophic consequences on retirees’ benefits. Perhaps the most surprising turn in relation to the possibility of a couple trillion dollars of stranded assets – as suggested by the carbon tracker group-, is the growing movement for fossil fuel divestment. It was announced at COP21 there is now more than $3B in funds that envision divesting their portfolios from fossil fuels in the near term.
And finally, a high point of this COP21 was the world’s mobilization of civil society. This took many aspects but was characterized by NGOs working together to organize marches and a “People’s summit” and achieved major successes prior to COP21: convincing President Obama to cancel the Keystone pipeline, pressuring Shell to stop its Arctic drilling operations. At COP21 they organized the Mock trial of Exxon Mobile for climate crimes. They vowed to continue pressuring their states in the coming years to ensure that important elements of the agreement are adhered to, including transparency and the ratcheting of INDCs. But they promised to fight against voluntary misinterpretation of fuzzy document wording that could till the future towards solutions like geoengineering and away from a 100% renewable energy future.
The ultimate measures of success and possibly the reality of the agreement being a turning point will depend on the perspective taken. From a financial perspective, success will be achieved if the agreement sends a clear signal to global financial investors that they should move money away from fossil fuels and toward clean-energy sources such as wind and solar power. And if the trillion of dollars that can be available flow rapidly to the renewable energy sector, we’ll be able to declare that it was a turning point. From a civil society’s perspective success will be linked to the existence of climate justice for different categories of people, indigenous people, poor people, women or future generations. But, in my perspective, we can declare it a success as through this agreement we have started writing a new chapter. Some cultures consider that the Earth is on loan for future generations. We can now, at least temporarily, reassure the world that all together we will mitigate our effects and offer the generations to come a better Earth.