Depending on the lens through which you look at the outcomes, you might consider the glass half full or half empty. Overall, the consensus is that, while the end result of COP26 was far from perfect, we have made steps in the right direction.
As a leading global advisory firm, WSP was privileged to play an active role in the discussions. Several WSP experts attended the conference in person, sharing their insights on a range of issues including resilience, net zero and industrial decarbonization. And many more were involved in countless side events alongside the main summit. As we enter a critical decade for climate action, their shared objective was to help steer the conversation and demonstrate how WSP can be a force multiplier to achieving the actions necessary to implement the conference goals.
The formal outcome of COP26 is called the Global Climate Pact and is primarily targeted at policy makers. However, numerous other pledges were made that will impact how businesses should conduct their activities. As COP26 concluded, WSP gathered a few experts from around the globe to take us through the outcomes and key takeaways. This topic was discussed in more detail in a webinar hosted on 23rd November.
In fact two webinars:
The overall sentiment
This was expected to be a quiet but critically important COP. For many observers, success hinged on countries providing strengthened commitments ahead of the conference, known as Nationally Determined Contributions (NDCs), on their efforts to cut greenhouse gas emissions.
There was widely expressed concern that GHG reduction commitments for the next five years are still not sufficient to keep global temperature increases to below 1.5 degrees above pre-industrial levels. Nevertheless, the commitments made in the run up to COP26 do still represent a step up compared to just five years ago.
And, in terms of bringing in a wide range of perspectives to the negotiating table, this COP was judged the “best COP ever” for equity, diversity and inclusion. Particularly significant was the participation of younger generations whose voices were frequent and prominent in the sessions. Equally, the forthright contributions from representatives of the “Global South,” who are facing the greatest impacts of climate change, were blunt and uncompromising. The event’s hybrid in-person/online nature meant that many attendees who were unable to travel to Glasgow could still participate virtually.
Key takeaways
New country commitments to reducing GHGs
One of the most scrutinised elements of COP26 was the progress in the commitments of individual nations to fighting climate change. Core to agreements made at the 2015 Paris COP was that countries would return in five years to make a new round of commitments focused on increasing their NDC commitments.
Prior to COP26, the majority of countries had already committed to strengthening their NDCs. As part of the discussions, all countries, with a few exceptions for special national circumstances, were asked to further increase the ambition of their NDCs by next year. The goal is to cut CO2 emissions by 45% by 2030 compared to 2010, and to be at net zero by around 2050.
Reducing unabated coal use
There has been considerable attention in the media on the disappointment following a last-minute change to the wording in the final deal around “unabated” coal use, under pressure from India and China. This refers to coal-derived power generation that is not mitigated with technologies to reduce CO2 emissions, such as Carbon Capture and Storage (CCS) or Carbon Capture, Utilization and Storage (CCUS) technology.
At COP26, the wording “phase out” coal was replaced by a pledge to “phase down.”
However, while the final wording is not as robust as hoped, the agreement on coal does still represent a significant achievement. This is the first time that a global climate deal has explicitly referenced fossil fuel consumption in terms of climate change, and a pathway agreed to reducing the use of coal to generate electricity.
Phasing out inefficient fossil fuel subsidies
There is a line in the Pact concerning the phase out of inefficient fossil fuel subsidies. Many countries provide subsidies to their oil, gas and coal industries, and since they generally claim that those subsidies are efficient, it will take time to see if this resolution results in any meaningful change.
Carbon markets: gaining real power
COP26 finally saw an agreement around rules by which nations must fulfill the pledges that they made in Paris five years ago regarding carbon markets. The agreement holds that if countries make faster progress on reducing their emissions, they can generate and trade carbon offset credits to other countries to help them meet their own obligations.
We’re expecting seeing real movement in this area. For example, a government could make some major changes in its assumed carbon price for its business case reviews, assuming carbon pricing should go up. This could mean that any project that is expected to emit large amounts of carbon would face a substantial dis-benefit in the business case review, hampering access to government support. On the other hand, carbon-saving projects will fare much better.
Rich countries must ‘at least double’ funds for adaptation
In 2009, developed countries promised to provide $100 billion in public and private funding each year from 2020 to help poor nations respond and adapt to climate change. This is based on the idea that while wealthy countries are largely responsible for causing most of the climate change, it is the countries of the Global South that are feeling a disproportionate level of impacts including droughts, storms and unpredictable weather.
Wealthy countries have been making progress on that commitment. However, total funding fell about $20 billion short of the target last year, and an official assessment before this COP indicated that it might not be reached until 2023.
Loss and damage funds to compensate for climate change impacts
Developing countries put forward a proposal at COP26 for a new “loss and damage” funding facility to help nations that suffer losses due to hurricanes, rising seas and other impacts. This is akin to providing compensation for the historic emissions of developed countries.
The US is leading the resistance to any suggestion that developing countries are entitled to compensation. Under the Glasgow Pact, countries can get technical assistance on dealing with impacts like relocating communities away from flood prone coastlines, but there is no suggestion that there will be money to cover the costs of rebuilding.
For context, the US is responsible for about a quarter of all historic greenhouse gas emissions, China about 14%, and the UK about 4%. Overall, just a handful of countries are responsible for the lion’s share of historic GHG emissions.
At COP26, the idea of loss and damage compensation was effectively pushed aside. It may be a more significant topic at COP27 in November 2022, which significantly will be held in Sharm-al-Sheikh in Egypt, with an African chair.
Resilience and Adaptation topics found a seat at the main table
For the first time ever at a COP, there was a Resilience hub. This included a focus on the “Race to Resilience,” and a commitment by 2030 to catalyze action by non-state actors that builds resilience to climate change for people from the most vulnerable groups and communities. This recognizes that even today, with global temperatures already 1.2 degree above pre-industrial levels, there has been ocean warming, more storms, climate-related migration, and other manifestations of climate change. There must be more focus on adaptation and resilience in addition to mitigation.
There was considerable cross-fertilization of ideas, as the issue of resilience applies across the various regional and topical hubs. This led to many joint presentations, at which the intersectionality of ideas came across clearly. The path forward is one of radical collaboration, agility and innovation.
Other key decisions at COP26
Methane: 100 countries supported the US/EU pledge to cut emissions of methane of 30%, a particularly potent greenhouse gas, largely from agriculture and fossil fuels, by 2030. Despite its very high global warming index, methane does not stay long in the atmosphere, so changes made now may have a significant impact in reducing global warming.
Trees: 110 countries backed the push to halt and reverse forest loss.
Coal: 23 countries made commitments to phase out coal power.
Vehicles: Several countries and vehicle manufacturers made commitments to phase out fossil fuel cars and vans between 2035 and 2040. Notably, China, the US and Germany did not sign the commitment.
Clean technology: 40 countries, including China and the US, agreed to collaborate to develop standards to grow the market for clean technologies.
Finance: Major financial institutions committed to aligning private financial flows to support net zero goals.
Net-Zero Standard: Ahead of COP26, the Science Based Targets initiative (SBTi), a partnership between CDP, the United Nations Global Compact and the World Resources Institute, delivered a consistent and authoritative definition for companies wishing to make a net zero claim and the criteria for ensuring it is robust.
To sum up…
Our goal as a company is to maintain the momentum achieved at COP26. We want to ensure that climate awareness is front of mind for all our people, and that we reflect and build in mitigation, resilience and adaptation measures into everything we do for our clients. WSP has made a commitment to achieve net zero emissions across its value chain by 2040. We intend to deliver on that commitment and to support our clients on their own journeys towards net zero. Let’s act now in preparation for COP27.
