Questions from BEIS Committee on COP 26
The headline goal of the Glasgow COP is to raise the ambition of all countries’ emission reduction targets or “Nationally Determined Contributions (“NDCs”). Existing country commitments made alongside the Paris Agreement (“PA”) in 2015 (which mostly set targets for the year 2030), are significant, but highly insufficient: they put the world broadly on course for a 3 degree temperature rise.
The ideal outcome would be increases in aggregate country ambition that put the world on track for the temperature goals set out in the PA (“well below 2 degrees, pursuing efforts towards 1.5 degrees”). It is important to remember that in most if not all cases, such NDC changes will happen well before Glasgow. They will not be negotiated. So the UK will need to be influencing political decision making in key economies from now
There is also a number of rules still to be agreed, which the Government should aim to finalise, for example around carbon markets
The UK should also promote enhanced action on tackling adaptation and providing finance to developing countries.
This is a challenging COP, in very challenging geopolitical conditions. But it is also an opportunity to demonstrate an outward looking, influential Global Britain, in an issue on which no country has a better overall record and capabilities than the UK. This will require whole of Government engagement led from the very top, and for the UK – in line with international expectations of the COP Presidency - to continue to set the benchmark for high ambition at home
The UK needs to catalyse improvements to NDCs from countries around the world which are as ambitious as possible. An optimal outcome appears beyond reach in Glasgow, but significant progress can and should be achieved
UNEP estimates that
- Current global emissions are somewhat over 50 billion tonnes of Greenhouse Gases
- Countries’ commitments made under Paris might leave the world emitting around 55 billions tonnes in 2030
- For the world to be on track
- So the “gap” between current commitment and what is needed is around 14 billion tonnes for 2 degrees, and around 30 billion tonnes for 1.5 degrees (i.e. more than halving current global emissions)
Realistically, based on broad subjective judgments about what might be the most ambitious action that countries might take, an additional 6 billion tonnes of abatement looks like being the upper end of what is doable in Glasgow. Upwards of half of this might be in China. This would be a step forward and the UK should do everything possible to achieve it. But it would be insufficient. This pessimistic outlook partly reflects the negative position of the current US Administration on climate change, and the PA in particular; but even with a more benign Administration in Washington, the unfortunate fact is that Governments and others around the world are not yet treating climate change as a first order issue, often falling to take even win-win action on areas like efficiency or renewable energy. So this is a political judgment of what might happen; technically it is entirely possible for countries to do far more than this
The UK needs to secure as much increase as it can get. But rightly -and partly in consequence – it is taking other action on ambition in parallel
First, they are seeking commitments from as many countries and other entities like cities and regions to set long term (c.2050) goals to get to net zero emissions. This is an important complement to 2030 targets because countries may be less cautious about setting such targets, and it allows a planned transition. Of course a risk is that these targets remain aspirational/declaratory
Second, the UK are looking at driving action bottom up through real world sectoral actions and coalitions, including
- The most transformational may be the private finance work being led by Mark Carney to mainstream climate risks into investments and policy making. Making mandatory the disclosure of climate risk, and active management of these risks by major companies and banks, could be hugely impactful
- Nick Stern is leading complementary and essential work on public finance, encouraging the international Finance Institutions to mainstream and prioritise climate
- There are important coalitions on electric vehicles, coal financing, supply chains and resilience, coordinated by the UK Climate Action champion, Nigel Topping
These coalitions have very considerable potential if well designed to drive action beyond the level of ambition represented by the headline NDCs; and to accelerate structural changes in the economy and in technologies that could drive emissions down faster in the coming years. The Government is right to be convening these
Finally – and more nebulously – the COP needs to reinforce the strong signal that is already shaping investments and business decisions. Governments are getting to grips with emissions. Even if we don’t get all we need in Glasgow the trend is clear and accelerating. All economic actors need to take account of that or they will be exposed. The policy response from Governments collectively is already strong and will get stronger. This is in my view inevitable. The stronger the progress and the signal now, the more likely the transition will be orderly and equitable.
Even before the Covid 19 virus stuck, climate change was not on the top of Leaders’ agenda around the world (as it was in 2015, thanks to the priority assigned it by Obama/Kerry; the leadership of the French and other factors) but mainly due to more favourable geopolitics, as exemplified by the US-China agreement on their respective NDCs in late 2014.
Covid has obviously exacerbated this. Leaders around the world are understandably focussed on the immediate health crisis, and the economic and social fallout.
The Government has rightly secured the agreement of the UN to deferring the COP until next November. It would have been hugely risky on public health and inclusion grounds to have gone ahead any earlier
The next step however is to shift the global focus progressively back onto climate, a bigger long term risk than Covid.
The best way to get climate on Leaders’ agendas short term is to make the case for fiscal stimulus packages to be climate smart. Whilst the first wave of post Covid Government interventions around the world were rightly focussed on health, livelihoods and liquidity, there is a recognition that a further stimulus will be needed in many countries to get the economy moving again. Spending could run into the trillions. And the right policies could make a huge impact on emissions trajectories. Action on energy efficiency, and solar energy for example is jobs rich (especially in the early construction phase when jobs are most needed); cost-effective; and good for emissions. But there is a risk that in many parts of the world priority will be given to high carbon infrastructure, including coal. The UK has been asked by the UN Secretary General to lead on coordinating an “inclusive and sustainable recovery” from Covid 19. This is a huge opportunity for the UK. The UK should look to set out what good looks like, convene key players, and set a strong example in its own stimulus package. This is an immediate priority
More broadly, the UK could help set the dominant global narrative around the virus. If Covid has taught us anything, it is surely that it underlines how essential it is that we prepare actively for risks, especially ones that we know are coming like climate change. Denying or delaying addressing these risks leads to much higher costs.
As we come out of the Covid crisis (we hope), the climate conversation around NDCs will need to be re-energised. The UK will need to work bilaterally and plurilaterally/multilaterally
A key priority will be to raise the issue bilaterally with all countries, both through in-country engagement by embassies/Ambassadors and in all Ministerial engagements, including targeted outreach from Ministers and above all the PM, as well as the Foreign Secretary and the COP President, Alok Sharma. Embassy staff have understandably been diverted to Covid work, but they will need to be reassigned as Covid pressures permit to improve our intelligence on where countries stand on their NDC preparation, what arguments might resonate with them as to why they should raise their ambition, and to deploy these in a timely way.
Particular priorities are
- China above all - its emissions are by far the largest globally, bigger than the US and the EU put together. This is not to demonise them: they have a huge population, and are a manufacturing economy. But their decisions matter above all. Their investment activities abroad are also hugely significant: most of the energy infrastructure they are building under the Belt and Road Initiative is fossil fuel. And their consumption of tropical agricultural products is driving deforestation. There are arguments that resonate with China (eg health impacts of pollution on their own citizens; stranded assets; opportunities in low carbon economy; international reputation. And they are hosting the biodiversity COP, while arguments around respecting nature are resonating more with them in the light of how Covid emerged),. But they also have big domestic and incumbent counter pressures, and a very unstable and challenging geopolitical environment which will make them cautious. They will probably wait until after the US election before announcing their NDC
- India is another big emitter, and much poorer than China, so asks of them are likely to be more around doubling down on win-win actions on renewable energy, electric vehicles and so on. Securing action from India, even more than China, is likely to need interventions at Leader level
- Vulnerable countries, including small islands, least developed countries and those in Africa have a major moral voice in the climate talks. this voice is not as loud and clear as it was in the years up to 2015. Over the last 15 years or so, the UK has arguably worked more closely and effectively with them on climate than any other developed country. These countries generally want high ambition so they are aligned with us; but they also want action on adaptation and financial support. Although the UK’s record is better than most, they feel short-changed by developed countries collectively. Furthermore, key emerging economies are increasingly influential in these countries as their principal creditors. Given the rhetoric of emerging economies around leadership of the developing world, the vulnerable countries’ voices carry weight with them. The UK should be appealing to these countries to call at the highest level for increased ambition from all. But the UK should also be working to ensure a seriously improved offer on resilience in particular. This is partly about public money from developed countries’ climate finance budgets, but also getting the Multilateral Development Banks to do more, and developing effective strategies to mobilise private finance into resilience. The UK should look to convene informal groups from these countries and elsewhere to develop solutions on issues like resilience, but also potentially on other issues like carbon markets
- EU countries. Whatever happens on Brexit, we have aligned interests with the EU, and with key Member States and we should work with them and enlist their support in pursuit of an ambitious outcome in Glasgow. It looks likely that the EU will commit in December to raise the ambition of its 2030 NDC from 40% to 50 or 55%, which is extremely important. But EU diplomatic cooperation will also be essential
Plurilaterally and Multilaterally
The key upcoming moment for climate is likely to be the EU-China Summit convened by Merkel (as current EU Presidency) in Leipzig in September. Relations between the EU and China are more suspicious than they were a few years ago (though obviously better than US-China relations). If the EU and China could agree a shared approach to climate, including enhancing ambition of NDCs, that would be a massive step. Climate is one of the issues in play, but so too are contentious issues around Investment rules for EU companies, Intellectual Property and so on, not to mention the broader backdrop around Hong Kong., Covid and the like
The next key moment after Leipzig will be the US election.
If Mr Biden wins, he has said that climate will be a priority for him, and that he will convene all major emitters in the first half of next year. The key question is whether a Biden Administration could reach an understanding on climate with China (and the EU), in spite of the wider challenges in their bilateral relationship. That could be a game-changer. We could also expect the US to be highly active in pushing other emitters including Japan, Australia, Canada, Mexico and others to raise ambition. This would make the UK’s task much easier
If Mr Trump gains a second term, then the US will remain outside the PA, without any meaningful action itself on climate, and - though not persuading others to join them in leaving the PA - exercising a drag on the ambition of others, partly for perceived competitiveness reasons. The UK will need then to work even more closely with allies in the EU to persuade others, including but not limited to China
The third key moment might be the UK’s own NDC revision. The UK is under a legal requirement to issue its own NDC in any case as a result of Brexit. There are two questions around this: timing; and ambition. On timing, some are saying that this must be this year, because that is their reading of what the PA requires, others say it would wait until next year. Either way, the UK will want to issue its new NDC relatively early, i.e. by the beginning of 2021 at the latest, in order to set the tone for others and put pressure on them to raise their ambition. It should consider doing this jointly with a group of vulnerable countries. The EU are likely to raise their ambition in December 2020, and the UK will want to take that into account. Whatever the timing however, there will be huge expectations on the UK to raise its ambition. The UK has chosen to host a COP, the primary aim of which is to raise the ambition of countries’ NDCs, and it would be very hard to explain if we do not do so ourselves
More generally, there will be expectations on the UK to show leadership at home across the piece. So, in addition to raising our NDC, and greening our fiscal stimulus, we will be under scrutiny on a range of issue from tax breaks and export support for fossil fuels, to building climate resilience into our infrastructure.
The key point is that a huge amount of the measures needed to tackle climate change make sense in any case for other reasons. For example energy efficiency usually saves money; renewables energy is cheaper than fossil fuels in most parts of the world, and electric vehicles will soon be cheaper than Internal Combustion Engines. All this before taking into account benefits of climate action for pollution/health, energy security and so on. There are some policies that would imply additional costs, but there is a vast amount that can and should be done at very low or negative costs. The problem is often around political economy challenges: how do you build the capacity to design and build things differently? How do you deal with incumbents and those who might lose from the shift to low carbon, even if the economy as a whole would benefit?
And at the same time of course we know that climate change impacts will be very costly – especially for the world’s poorest- and Covid shows it is cheaper to prepare for disasters rather than wait until they happen. We should hammer home this message
A key political uncertainty is around the outcome of the US election on 3 November. That is discussed above. Even with a benign US Administration, there is a risk that increases in NDC ambition will be small, even significantly below the (modest) maximum feasible.
A second risk is that Covid is not brought under control in time to hold a full COP even by November next year. It would be challenging to defer it a second time, and it would be important to consider and prepare the range of options available
Brexit is happening at the same time as the COP preparation is going ahead, and is inevitably going to consume lots of oxygen among senior Ministers (along with Covid), and much of the UK’s diplomatic energy and capital. Securing support from key allies will help to mitigate that. But there is no escaping the need for senior Ministerial active participation, including the PM, and us of UK diplomatic capital
We know that the Glasgow outcome, even on the best scenario, will not be all that is needed. There is likely to be a lot of anger about that. The UK will need to consider how it prepares both in terms of the physical arrangements at the COP, but also in ensuring we have a clear route map to further increases in ambition beyond Glasgow, both top down through NDCs, and bottom up through real economy progress.
It will be important that the UK and the Scottish Governments cooperate effectively.
There is inevitably a risk that senior Ministers’ attention will be absorbed by many other priorities over the next 18 months, not least Covid and Brexit. It will be important to ensure the COP issue remains high on the agenda for Ministers across Government, not just BEIS, but also the PM, the Chancellor, the Foreign Secretary and the DFID and Defra Secretaries
The UK has been fortunate in benefiting from broad political consensus on climate change, and there should be opportunities to build on activity that the UK Parliament has already taken to share itis experience and to build the case for climate action with other legislatures