Why a brave climate deal is possible this year
At TTU we highlight cutting edge trends to alert leaders on why they must change how they think.
Tom is advising the UK government’s preparation work for the COP26 Climate Change summit in November.
This posting to coincide with the many dramatic global political declarations at President Biden’s virtual climate summit should encourage us all.
Tom has unique inside knowledge. He was senior political strategist that achieved the remarkable Paris climate agreement in 2015. He supported the work of Christiana Figueres, the UN Executive Secretary for Climate Change.
Their book The Future We Choose highlights brilliantly the dilemmas each of us faces, and the choices we must all make.
This is a lightly edited version of Tom’s remarks to the Chief Sustainability Officer Summit at the University of Miami’s Herbert Business School on 24 March 2021
We over here in the UK are trying to figure out how to run a successful climate negotiation at the end of the year. I’m spending quite a bit of time liaising with number 10, and the Cabinet Office on how to do that. It’s a very different year to Paris.
There’s a lot of complexity around the package that needs to be delivered. And there’s a lot of reality breaking through around where we are post COVID. What opportunities we have. What’s moving faster, fast enough, and what’s not moving sufficiently quickly, for us to get there.
This a critical year. This is the most critical of decades that we have ever faced. And I think we need to really come into the 2020s with that front and centre. Science is now very clear that unless we reduce emissions by 50% in the next 10 years, then the opportunity to limit global warming to 1.5 degrees will really have begun to slip away.
So this is it. We got all the stars in our favour. Let’s make it count this year and for the next ten.
The big difference: Paris in 2015 to Glasgow in 2021
Six years ago I ran political strategy for the United Nations. We spent several years getting countries aligned in order to reach the Paris Agreement. The Paris Agreement was very different to any attempt to achieve an international consensus on climate change before.
Remember the Kyoto Protocol and the previous attempts that collapsed in Copenhagen. In those scenarios, there was an attempt to get a global agreement on what the collective emissions reduction would be. Countries would agree that at the UN, then go back to their respective capitals, and try to pass legislation.
That, of course, had a very unhappy history, particularly in the United States. [Vice President] Al Gore famously signed Kyoto, but never got it through the Senate. There was always this approach avoidance. This realisation that things signed internationally may not receive a positive response in the legislative bodies in the US.
Acknowledging that reality, several years before Paris we spent a lot of time thinking how could this be structured differently. In the end, what we came up with was two things.
Two options to secure progress and agreement
One is a long term goal to reach net zero by the middle of the century that deals with the issue sufficiently. The second is a series of five yearly incremental commitments that keep us on that trajectory to meet the long term goal.
I usually describe it by saying “I want to lose 20 pounds in a year”, then I’m going to set myself a weekly or fortnightly target over the course of the next year.
The challenge, of course, is that the first round of targets that were agreed in Paris were not on the emissions reduction trajectory that got us towards the final goal. The final goal is to limit climate change to 1.5 degrees. [But] the emissions commitments agreed in Paris for the first five year period took us on a trajectory to nearly four degrees!
Bending the curve
The reasons why Glasgow is so important are a couple of things. First of all, this is the first test of that international mechanism.
Does it work? And if it doesn’t work, we’re back in the wilderness from an international agreement perspective around how we deal with this issue.
If it does work, what that means is countries will come back to the table with their next round of national commitments.
That should bend the curve. But the question is, how much will they bend it down from 3.7 degrees? To what? What would success look like? Would two degrees be success knowing that we’ll come back in five years for more incremental commitments? Would 1.5 degrees be success? There’s a lot of discussion around that.
The other interesting question that’s part of this year is: what role for everybody else?
The world has changed so much since 1972 when the world started thinking about this issue. In 1992 the world started thinking about it seriously.
National governments play a very important role in setting legislation. But what investors do, what cities do, what business does, also has a fundamental role. Should they have a seat at the table? And if so, how should that fit alongside national governments?
So that’s the whole package that we’re trying to get our arms around for this year.
Agreements needed well before COP26 in November
One of the interesting wrinkles in this - around why it’s so difficult - is because there’s no political jeopardy in Glasgow.
There’s no moment where there’ll be: do you win the game and the gavel comes down? You get the agreement or you don’t? It’s a matter of incremental agreements throughout the year that get us there.
Which actually leaves us with a problem in Glasgow around how do you actually keep everybody engaged and driving towards a common outcome.
It’s like turning up to the cup final, when you already know who won the match. It’s quite complicated to think about how you manage that in a productive way.
What will be success in Glasgow?
That’s a great question. There needs to be more agreement on that.
From my perspective, if we can take the emissions trajectory from 3.7 degrees and bend it down closer to two degrees, and we come out, and we add up what every national governments going to do, what every business, what every city, what every region is going to do, and we have a trajectory that keeps us to two degrees, [then] that is success.
That keeps us on the road. We can [then] keep innovating and making progress. And in five years time, we’ll make even more progress.
Getting the facts right!
When President Trump gave that speech [on 1 June 2017], I sat down with my friend and colleague, Christiana Figueres with a blank sheet of paper, intending to write down every time he said something that was accurate about the Paris Agreement. We ended that speech with a blank sheet of paper.
He did not understand the structure of that agreement and the fact that actually nothing was being imposed on anybody. It is all nationally determined. Every country came to the table with their nationally determined commitment (NDC): what they were going to do, how they were going to make that count.
That was presented for whatever reason, in a way that was either misunderstood or misrepresented.
However … ., in those four years [of President Trump], what we did see was a significant step up - cities, counties, businesses, investors to actually come further forward. We did see significant emissions reductions in the US throughout that time period to the point where up until about 12 months ago, it looked like the US was going to still be able to meet its commitments under its first round of NDCs. [This was] just on the momentum that was in the system from those commitments.
Now, that doesn’t go on forever. The legislative and regulatory foot has to fall in order to actually keep that innovation moving.
So it’s really important now that we do see meaningful executive and legislative action by this president from a climate perspective, if we’re going to continue so see emissions in the US fall.
Frankly, [we have to ask] is the US going to have the moral authority to play the role that it played in Paris, which is to go around the world, and persuade other countries to step up as well? Because at the moment, there’s significant scepticism as to whether this is a temporary flip back to climate leadership from the US that will flip the other way in four or eight years. And how permanent is this new situation?
I’ve heard [US Special Presidential envoy for Climate] Secretary Kerry use the phrase “what the US is now doing is irreversible by any future demagogue”. That is exactly how he phrased it when he spoke to the UN. But of course, it’s not. It’s all executive action so far.
So how will that be implemented? And what platform will he have to talk to the rest of the world about it?
What must lead: business innovation or government regulation?
It’s essential, but it’s nowhere near sufficient. What you find is that legislation regulation keeps up the rear.
Business innovates, changes business practices, changes the underlying economics. Then in the end governments tend to regulate what’s already happening.
I think it’s a fallacy to think governments will lead with regulation or legislation. But they do need to follow up and keep up the rear to ensure that the whole economy moves in that direction. So we can’t get there without that kind of action.
The new driver of technological change
In Paris, when we were talking to businesses or even countries, we would say it will be cheaper to implement climate solutions than incumbent technologies. It wasn’t true in 2015. But it’s true now.
Renewables and wind are the cheapest form of new energy in most parts of the world, often significantly cheaper - even than operating standing and in some cases, fully amortised, fossil fuel production plants. Electric vehicles are certainly the cheapest for fleets. Hydrogen is almost at cost parity for fleets.
Those are some of the changes that are really driving transformation because they’re affecting the underlying economics.
We’re seeing that now in the US, particularly with wind in Wyoming and in Texas. There’s a real change around how that’s happening.
Underneath that from an individual perspective we have seen real change.
One of the things we do is work very closely with Amazon. In creating this climate pledge, Amazon has committed to being net zero by 2040. There’s a range of other companies that have stepped forward to commit to that as well.
There’s a lot of corporate commitments.
Net Zero by 2050, or much sooner?
It’s not just that. There’s the climate, science-based targets and other things that many will be familiar with.
The reason why we partnered [with Amazon] to create that is because planting that flag and saying, actually, we can get there further, we can get there faster, we can achieve this by 2040, we don’t even have to wait until 2050 – [is] that can have a really important psychological and strategic effect on policymakers and on other business strategy decision makers. So that can be really important.
Lack of fairness – the big divider
It depends how you look at it. One of the things that plagued the negotiations prior to Paris is the issue of fairness.
Climate change is fundamentally unfair. It’s geographically unfair, economically unfair, generationally unfair.
The schism used to be that developed countries caused the problem and said to the world in 1992 that they’d sort it out.
So developing countries would say: go and do something meaningful, then come back and talk to us. And we’ll talk about a global deal.
But developed countries would say to developing countries: look the world’s changed. The majority of emissions now come from India and China. We can’t do this on our own.
So you have to look at it from a slightly historical perspective. And through that lens, although it’s not sufficient, it is interesting that China is committed to being net zero by 2060. Now, they haven’t provided enough colour and enough detail around how they’re going to get there, and what the arc of reduction will look like. But that’s a significant commitment.
We’ve seen the same in the UK: Net Zero by 2050.
The EU is now introducing new commitments in the 2030s. Costa Rica is Net Zero already. There’s a lot of good momentum from these different places. I think what we’re seeing now is that as the economic [realities] shift, as the underlying trends change, then countries can go faster and faster.
How to measure, compare and enforce (if necessary)
There’s lots of answers to that question. One is NGOs do have a role.
Places like CDP [a not-for-profit that helps companies and cities disclose their environmental impact] play a critical role in ensuring there is regular reporting, and that needs to be verified, etc.
So you have some degree of comparability year on year, although it’s not perfect, as everybody knows. Ultimately, this needs to be incorporated into regulatory filings along standardised measurements. And at the end of the day there are also other monitoring mechanisms, which we are now finding have been particularly effective, particularly when it comes to things like land use, the use of satellites, monitoring other different countries.
In the UN, we have these national review processes where countries step up every couple of years. They bring their review as to where their emissions are, how they know they are like that, and others scrutinise the point at which they get to.
I’m not suggesting we need that level of oversight for companies. But we do need to get to a point where we know that apples are comparable.
At the same time there’s a tension in there.
I also hear from companies that the sustainability reporting space can become so onerous and so complicated, that it can lead to concerns about jumping in because you crack open the lid on enormous amounts of complexity and cost around managing that down the line: how much and how difficult it’s going to be for you to comply with these new commitments that you’ve made.
So I think we need to adopt a very practical approach that is solutions driven. We need to have comparability. This needs to be incorporated ultimately into regulatory filings. But we also need to have sufficient flexibility to be innovative and fast moving, to understand that actually what matters here is action and progress and momentum.
So there’s a sweet spot in there that I think is really important.
Has adjusting to COVID-19 improved Net Zero prospects?
We’ve seen the first drop in history [for carbon emissions] this year. It is roughly comparable with the overall drop that we have to see on an annualised basis to reduce emissions by half in this decade, which is instructive for us.
I’d say a few things.
Number one, we’re not going to solve this by just ceasing economic activity, which partly happened this year.
Partly the drop is because people didn’t go places, people didn’t fly, people didn’t do different things. And that’s led to a lot of hardship for a lot of people. We need to be honest about that.
The truth is that we can only make this change at the speed at which democratic systems will allow us to.
If this transformation leads to drops in jobs, drops in economic activity, drops in economic well being and livelihood, then democratic elections will just go another way and that progress will stop.
So we shouldn’t think that the drop in economic activity this year is the transformation that we’re talking about.
Having said that, I do think that it’s shown us a few things that actually might stick.
I have spent the last 12 months, barely leaving my house, right. I’ll talk to you and in 20 minutes I’ll be downstairs having dinner with my kids. That’s great, and I don’t have to be with you in Miami.
I think that those sorts of changes are really important. And many of those will continue to stick. Those types of transformations in the way we see ourselves and in the way we live our lives, what quality of life means: that will hopefully be a big difference.
But the other thing that this year has shown me is that people talk a lot about individual responsibility and their lifestyles. It is important that we all do what we can, both because it can be significant and also because it makes us feel like we’re part of this transformation.
But we’re never going to make a bigger change in our lives than we made this year. And the drop was only 7%.
So where’s the other 93% going to come from if with this much disruption I’ve barely left my house in 12 months and it’s only 7% reduction? That underlines the fact that most of this change is going to be down to technology. And it’s going to be down to innovation, changing business processes, making things cleaner.
There is a lot to unpack in all of that.