The Glasgow Climate Pact – keeping 1.5°C within reach
Following two weeks of intense negotiations amongst nations, COP26 President Alok Sharma announced on Saturday 13 November that the Glasgow Climate Pact had been agreed amongst all parties. The agreement sets out a number of actions that will be key to tackling the climate crisis, strengthening efforts to address adaptation, mitigation and finance. It also notably includes the first ever international commitment from governments to ‘phase down’ coal. Sharma himself declared the pact ‘historic’ but added that while it kept 1.5°C alive from a policymaking perspective, the pulse remained weak and that countries would be judged not just on the commitments made but whether they delivered upon those commitments.
COP26 also formally completed technical negotiations on the Paris Agreement rulebook, setting out transparency and reporting requirements for tracking progress against emissions reduction targets. It also established Article 6 mechanisms required for international carbon markets to support cooperation on emission reductions. Overall, it successfully concluded several significant milestones that will drive all countries to strengthen their ambition on emissions reductions plans, additional funding, and adaptation efforts over the coming years.
During the negotiations, countries recognised that existing pledges are insufficient when it comes to achieving 1.5°C. Prior to COP26, the planet was on course for 2.7°C of global warming. Experts estimate that based on announcements made over the last two weeks, we are now on track to somewhere between 1.8°C and 2.4°C. Regardless, more ambitious action is required to achieve the collective emission reductions needed by 2030, and the Glasgow Climate Pact sets out a commitment to strengthen 2030 targets by COP27 and report annually on progress against those targets.
Fossil fuel phase down
The final document is remarkable for its recognition of the need for ‘accelerating efforts to phase down unabated coal power and phase out inefficient fossil fuel subsidies. As part of the 2021 Global Investor Statement to Governments on the Climate Crisis, investors called on governments to phase out coal-based power and set deadlines for removing fossil fuel subsidies. It is disappointing to many countries and investors to not see these requests fully met, and that the specific wording relating to coal power was watered down in final negotiations. However, its inclusion still represents significant progress from previous national commitments and is considered a win by many campaigners.
Ambition has also stepped up in relation to adaptation, with developed countries being urged by their developing counterparts to double adaptation finance by 2025. In addition, the agreement calls upon multilateral development banks, other financial institutions, and the private sector to play their part in enhancing mobilisation of finance in order to deliver the resources needed to achieve climate adaptation plans.
The formal outcome from the COP26 negotiations builds upon the numerous commitments, pledges and announcements made throughout the conference. Governments, financial institutions, and companies came together to prioritise delivering a net zero economy by 2050, funding solutions and clean technologies, ending deforestation, eliminating fossil fuel use, and leading the way on loss and damage from climate change. While the work to convert all these commitments into action is only just beginning and there is undoubtedly still a huge amount to do, we are encouraged by the positive signs and progress shown throughout COP26 and in the level of ambition demonstrated in the formal outcome.
As we shared in our day-by-day COP26 summary, the role for IIGCC and our members is more critical than ever as we look to the future. Continued and accelerated progress will be needed over the coming months as countries, businesses and investors translate the pledges made into tangible action, and – as one of the founding networks responsible for the Investor Agenda, Climate Action 100+, the Net Zero Asset Managers initiative and the Paris Aligned Asset Owners group – we are well placed to collaborate with stakeholders across that spectrum to support progress and drive meaningful change.