Seb Beloe of WHEB Group writes on the WHEB Blog (republished with kind permission). After 12 formal negotiating days attended by 150 heads of state and several thousand negotiators and with a supporting cast of 450 mayors, companies, NGOs and investors what did the Paris climate negotiations actually achieve and does it matter?
We might not go as far as the UK’s Guardian newspaper which described the deal as ‘The world’s greatest diplomatic success’, but our view is that the 31 page agreement is nonetheless an extremely important milestone in the global effort to tackle climate change. Coming 18 years after the previous agreement in Kyoto, the Paris agreement achieves a number of important milestones.
Firstly, a long-term greenhouse gas reduction target is now formally adopted by the world’s nations. Granted it is not actually a number, but is expressed in rather convoluted language as ‘a balance between sources and sinks of greenhouse gases from 2050’. But in essence it means no net emissions from this time.
Secondly, the ambition level has actually been raised with the objective to keep global temperatures ‘well below’ 2ºC and to pursue efforts to limit it to 1.5ºC. Few were anticipating a stricter target coming out of the conference.
Thirdly, and perhaps most importantly, a legally binding process to review and report on efforts to achieve national targets. Critically this process obliges countries to consider formally whether to strengthen their targets and policies every five years.
And finally, $100bn of annual climate finance was also secured to help poorer countries adapt to inevitable climate change and to support efforts to mitigate further climate change by reducing their greenhouse gas emissions.
Weight-watchers for countries
The so-called ratchet and review process is seen as perhaps the single most critical piece in the new deal as it is this mechanism that will help put pressure on countries to deliver – and hopefully increase – their own voluntary emission targets. Currently, aggregated domestic and regional targets volunteered in advance of Paris put the world on a course to 2.7ºC. Still far too much and so this mechanism is needed to help ratchet up the national targets. One commentator likened this process to a version of ‘weight-watchers’ where countries, publicly reporting on their progress, are subject to peer pressure that rewards outperformers and brings global opprobrium to the laggards. This process has already worked well in securing the 187 voluntary national commitments in advance of Paris.
So what does this mean for the investment community? While the issue has been reasonably well-covered in the mainstream media, still relatively little investment research has been done interpreting the Agreement for the investment community.
In truth this is understandable, as the short term impact of the agreement is muted. Ultimately the Paris agreement is focused on the governance of how the world’s countries will move to tackle climate change. It does not contain country or regional greenhouse gas reduction targets, a feature that has led some environmentalists and academics to describe it as a ‘fraud’ and a ‘fake’. But after the failing of the Kyoto Protocol, this was never a realistic proposition. The real impact, for investors, businesses and indeed the world more generally comes with the policies and targets adopted by sovereign states. These can be expected to be refined and implemented over the coming years.
Short fossil fuels, long renewables
Having said that, the Paris Agreement clearly helps to cement the long-term trajectory of the world away from fossil fuels and towards low carbon sources of power particularly renewables and nuclear. For many investors this trajectory is already abundantly visible, but for those for whom it was not, the Paris Agreement serves to tip the balance further in favour of these low carbon technologies. In fact, a quick read of the main national plans, known in UN jargon as INDCs, reveals just how much the energy sector will change over the next fifteen years, with solar photovoltaics in poll position. The International Energy Agency for example believes that over $16 trillion will be invested in renewables and energy efficiency over this period.
The financial and business communities
Amid the horse-trading and late night negotiating that is part and parcel of these negotiations, one other seismic shift was clearly apparent. In previous summits the private sector has either been absent or, led by the fossil fuel industries, has worked to undermine any form of agreement. In Paris, the role of the private sector – extending even to oil and gas businesses – was to support a strong deal. Laurent Fabius, the urbane French Foreign Minister and Chair of the conference singled out the financial sector in particular by proclaiming that “The financial industry is much more present at COP 21… You are major players and we congratulate you.”
The Paris Agreement though is just the start. The hard work of securing radically lower greenhouse gas emissions over the next decades lies ahead.
A Good Look At How Homes Will Become More Energy Efficient Soon
Everyone always talks about ways they can save energy at home, but the tactics are old school. They’re only tweaking the way they do things at the moment. Sealing holes in your home isn’t exactly the next scientific breakthrough we’ve been waiting for.
There is some good news because technology is progressing quickly. Some tactics might not be brand new, but they’re becoming more popular. Here are a few things you should expect to see in homes all around the country within a few years.
1. The Rise Of Smart Windows
When you look at a window right now it’s just a pane of glass. In the future they’ll be controlled by microprocessors and sensors. They’ll change depending on the specific weather conditions directly outside.
If the sun disappears the shade will automatically adjust to let in more light. The exact opposite will happen when it’s sunny. These energy efficient windows will save everyone a huge amount of money.
2. A Better Way To Cool Roofs
If you wanted to cool a roof down today you would coat it with a material full of specialized pigments. This would allow roofs to deflect the sun and they’d absorb less heat in the process too.
Soon we’ll see the same thing being done, but it will be four times more effective. Roofs will never get too hot again. Anyone with a large roof is going to see a sharp decrease in their energy bills.
3. Low-E Windows Taking Over
It’s a mystery why these aren’t already extremely popular, but things are starting to change. Read low-E window replacement reviews and you’ll see everyone loves them because they’re extremely effective.
They’ll keep heat outside in summer or inside in winter. People don’t even have to buy new windows to enjoy the technology. All they’ll need is a low-E film to place over their current ones.
4. Magnets Will Cool Fridges
Refrigerators haven’t changed much in a very long time. They’re still using a vapor compression process that wastes energy while harming the environment. It won’t be long until they’ll be cooled using magnets instead.
The magnetocaloric effect is going to revolutionize cold food storage. The fluid these fridges are going to use will be water-based, which means the environment can rest easy and energy bills will drop.
5. Improving Our Current LEDs
Everyone who spent a lot of money on energy must have been very happy when LEDs became mainstream. Incandescent light bulbs belong in museums today because the new tech cut costs by up to 85 percent.
That doesn’t mean someone isn’t always trying to improve on an already great invention. The amount of lumens LEDs produce per watt isn’t great, but we’ve already found a way to increase it by 25 percent.
Maybe Homes Will Look Different Too
Do you think we’ll come up with new styles of homes that will take off? Surely it’s not out of the question. Everything inside homes seems to be changing for the better with each passing year. It’s going to continue doing so thanks to amazing inventors.
ShutterStock – Stock photo ID: 613912244
IEMA Urge Government’s Industrial Strategy Skills Overhaul To Adopt A “Long View Approach”
IEMA, in response to the launch of the Government’s Industrial Strategy Green Paper, have welcomed the focus on technical skills and education to boost “competence and capability” of tomorrow’s workforce.
Policy experts at the world’s leading professional association of Environment and Sustainability professionals has today welcomed Prime Minister Teresa May’s confirmation that an overhaul of technical education and skills will form a central part of the Plan for Britain – but warns the strategy must be one for the long term.
Martin Baxter, Chief Policy Advisor at IEMA said this morning that the approach and predicted investment in building a stronger technical skills portfolio to boost the UK’s productivity and economic resilience is positive, and presents an opportunity to drive the UK’s skills profile and commitment to sustainability outside of the EU.
Commenting on the launch of the Government’s Industrial Strategy Green Paper, Baxter said today:
“Government must use the Industrial Strategy as an opportunity to accelerate the UK’s transition to a low-carbon, resource efficient economy – one that is flexible and agile and which gives a progressive outlook for the UK’s future outside the EU.
We welcome the focus on skills and education, as it is vital that tomorrow’s workforce has the competence and capability to innovate and compete globally in high-value manufacturing and leading technology.
There is a real opportunity with the Industrial Strategy, and forthcoming 25 year Environment Plan and Carbon Emissions Reduction Plan, to set long-term economic and environmental outcomes which set the conditions to unlock investment, enhance natural capital and provide employment and export opportunities for UK business.
We will ensure that the Environment and Sustainability profession makes a positive contribution in responding to the Green Paper.”