Activists who had gathered in Paris celebrated the announcement of the agreement. Photo / AP
Activists who had gathered in Paris celebrated the announcement of the agreement. Photo / AP
Agreement on climate is truly historic but it requires nations to act and the big companies and investors of the energy sector to get behind it — and even then it may not be enough
The word "historic", to describe the just-accepted Paris climate agreement, is more than warranted.
The world now has a comprehensive regime in place to shape how its diverse nations go about the urgent task of reducing their greenhouse gas emissions. That's why climate activists are ecstatic. It's a big deal.
The more ambiguous news, however, is that this document, by its very nature, depends on key sectors of society to respond to help make sure its goals are realised. Countries, companies and individuals across the planet will have to do the right things - and very hard things, at that. And it's too soon to tell exactly how they will do so.
What's more, even if everyone plays by the rules, the standards and goals set out by the Paris agreement may not be enough to prevent the catastrophic effects of climate change. New science suggests that forces already set in motion - the melting of glaciers, the release of carbon dioxide from thawing permafrost - could unleash considerable effects that the new deal cannot prevent. But those doubts should not overshadow the magnitude of what was accomplished. And there are reasons for hope.
Most important is the energy sector. Even before this landmark text there was a sharp growth in renewable energy instalments around the world, from the United States to Germany to China. We have seen the coal industry begin to stumble and a surge in natural gas. The trends are already pointing in the direction that the agreement means to encourage.
But what will energy companies - and energy investors - do once they read that the world now intends to "reach global peaking of greenhouse gas emissions as soon as possible and to undertake rapid reductions thereafter?" Will this send a strong enough "signal", in the words of US Secretary of State John Kerry, to change the decisions that these companies and wealthy individuals make?
An evolution in the private sector is crucial because, despite all the powerful language of the Paris agreement, it does not immediately oblige countries to do anything more than what is in their already-released climate pledges, or "Intended Nationally Determined Contributions."
And, as has been often stated, these pledges are not compatible with the Paris agreement's ambitious temperature target, which is to limit "the increase in the global average temperature to well below 2C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5C above pre-industrial levels".
The document requires countries whose current pledges go out to 2025 and 2030 to update them (and increase their ambition) in 2020. So a lot of progress needs to happen between now and then, in the form of rapid installations of wind, solar and other forms of renewable energy around the world. If in 2020 countries look around and see that they're in the midst of a surprisingly rapid clean energy transition, then it will be easy for them to strengthen their pledges.
Until now, analysts have generally expected the clean energy transition to be gradual rather than radical, and that we will still significantly depend on the use of fossil fuels for some time. One key measure of the success of Paris is how much it changes this dynamic. Early signs suggest it could.
The new text sends "a very strong signal to business and investors that there is only one future direction of travel to reduce emissions in line with a 1.5 degree pathway", said Stephanie Pfeifer, chief executive of IIGCC, a network of 120 institutional investors with more than $21.3 trillion in assets under management. "Investors across Europe will now have the confidence to do much more to address the risks arising from high carbon assets and to seek opportunities linked to the low carbon transition already transforming the world's energy system and infrastructure."
Another key question is what the agreement will do to spur more research into a suite of technologies that go unmentioned in the text, but which it effectively puts in the hot seat - so-called "negative emissions" technologies that would be able to remove carbon dioxide from the air.
Scientists have said that the aspirational temperature goal contained in the text, namely that "parties should pursue efforts to limit the temperature increase to 1.5C above pre-industrial levels", likely won't be possible unless we have a large-scale way of removing carbon dioxide from the air.
Many scenarios for limiting warming to 2C also rely on such technologies.
The new text appears to empower these technologies further when it says that the ultimate goal is to "achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century". Sources are things such as coal-burning power plants - sinks include trees, forests and oceans. But the language in this section may also subtly invoke negative emissions technologies.
French President Francois Hollande, right, French Foreign Minister and president of the COP21 Laurent Fabius, center, and United Nations Secretary General Ban ki-Moon. Photo / AP
Commenting on this "long-term goal" language, John Schellnhuber, director of the Potsdam Institute for Climate Impact Research, remarked that "to stabilise our climate, CO2 emissions have to peak well before 2030 and should be eliminated as soon as possible after 2050. Technologies such as bioenergy and carbon capture and storage as well as afforestation can play a role to compensate for residual emissions, but cutting CO2 is key". In other words, yes - there is going to be a lot of carbon cutting in coming centuries, but there may also have to be quite a lot of carbon withdrawal and burial by human-made devices (or carbon sequestration by human-planted trees). The conversation needs to start now about these technologies, many of which have major side-effects, such as the use of very large amounts of land (to grow the crops and plants that would be burned in bioenergy combined with carbon capture and storage schemes).
"So far, negative emissions are basically science fiction," says Oliver Geden, a scholar with the German Institute for International and Security Affairs. "We will need a serious debate on the consequences, and R&D on a massive scale."
The Paris accord thus does indeed deliver us into a very new world. Even as we monitor ongoing changes in the climate, our attention must now shift to the business and technology trends that just may save it.
The first global legally binding deal to tackle global warming. The agreement aims to prevent dangerous climate change by cutting the greenhouse gas emissions that cause it. It sets a goal of limiting warming to 2C, the level of warming beyond which scientists say the world will experience the most severe effects of climate change, including heatwaves, droughts and flooding - and an ambition of limiting it to 1.5C.
Will it solve global warming?
No - at least, not by itself. National pledges to cut emissions, made before the summit, are likely to leave the world on course for warming of at least 2.7C, according to the UN. They will make a significant "dent" in the warming that might otherwise be seen, but not enough to prevent dangerous warming. The goals of limiting warming to 2C, or even 1.5C, will be achieved only if countries now make good on the processes set out in the deal to implement and improve their pledges to cut emissions further.
Is the deal legally binding?
The agreement will become legally binding from 2020 on all countries that ratify it. Ratification is expected to begin next year, at a ceremony planned in New York in April.
The deal means countries are likely to continue pursuing climate change targets, which will require a transformation of economies away from fossil fuels to green energy sources. That means a future where most new cars will be electric by 2030, where homes will have to stop relying on gas for heating, and where consumers will continue to pay rising subsidies for renewable electricity through energy bills.
Five key points of final climate draft deal
1. A long-term goal to limit temperature rises to "well below" 2C above pre-industrial levels - beyond which the worst impacts of climate change are expected - and to pursue efforts to limit the temperature increase to 1.5C, which the most vulnerable countries say is necessary to ensure their survival.
2. A goal for greenhouse gases to peak as soon as possible, undertake rapid reductions "in accordance with best available science", and "achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century". The language is weaker than some previous options, which had specific figures for emissions cuts. But it references the science, and the latest report by the Intergovernmental Panel on Climate Change (IPCC), approved by governments, warned emissions would have to come down by between 40-70 per cent for the 2C goal and 70 to 95 per cent for the 1.5C goal by 2050 and ultimately reach net zero to stabilise the climate.
3. Countries are to submit climate action plans for what they will do to curb global emissions, including a five-yearly system of reviewing and updating them with growing levels of ambition. They are being requested to update the contributions they have already made by 2020. The review system is important because the climate action plans already submitted up to 2030 are not enough to put the world on a path to limiting temperature rises to 2C, or the more stringent 1.5C target.
4. Finance for poor countries to develop along a low carbon path and to cope with the impacts of climate change. Developed countries will continue to provide US$100 billion ($148.8 billion) a year until 2025, and will scale up finance flows after that.
5. The deal differentiates between developed and developing countries in terms of what they will do to curb emissions and the provision of finance to help support poor countries deal with climate change.
A closer look at the main issues
Keeping the warming of the planet within a "safe" range.
Agreement: The text calls for keeping the "increase in the global average temperature to well below 2C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5C above pre-industrial levels".
What it means: A big win for small island states and other developing nations who have said a temperature increase of 1.5C would be devastating to them because of rising seas, loss of coral reefs and other effects.
Ratcheting down greenhouse gas emissions.
Agreement: To reach "global peaking of greenhouse gas emissions as soon as possible", followed by rapid reductions "in accordance with best available science" to achieve a balance between man-made emissions and "removals by sinks of greenhouse gases in the second half of this century".
What it means: Emissions won't necessarily go to zero after 2050, but they will go low enough to be offset by natural processes, such as the growth of forests and plants, or by advanced technologies that are able to remove greenhouse gases from the air.
Getting more aggressive action (because current pledges don't put the world on a path to limiting warming to 2C, much less 1.5C).
Agreement: Each country will deliver, every five years, a new pledge to further reduce emissions. The pledge should represent a "progression" over the previous one and the "highest possible ambition".
What it means: The hope is that an expansion of the clean-energy sector will make it possible to cut emissions growth ever-more aggressively to "bend" the emissions curve down and achieve temperature goals.
Adapting to damage that will inevitably occur, even with the pact.
Agreement: Countries will step up "adaptation planning". For effects that cannot be adapted to, the pact has a "loss and damage" section that calls for the use of "risk insurance facilities, climate risk pooling and other insurance solutions".
What it means: The loss and damage section, although not as strong as some wanted, is a key win for small island states and other developing, vulnerable nations. How much adaptation and loss-and-damage insuring or compensation occurs ultimately will come down to money.
Who pays?
Agreement: Developed countries will provide financial resources to developing ones to help them brace for the impact of climate change and also move to cleaner energy systems. Wealthier developing countries can also contribute. Developed countries would have to communicate about their climate donations every two years.
What it means: Everybody gets something here. Developing nations get the commitment they were looking for from the developed world. And countries such as the US get assurance that richer developing countries will also pitch in.
