My recent newsletter, in case you missed it.
In December at the COP21 UN climate conference an agreement was reached by 195 countries to keep global temperature rise below 2 degrees from pre-industrial levels. The agreement sets out how countries will reduce emissions, adapt to the impacts of climate change and finance a low-carbon global economy. Click on the link to go to Carbon brief’s excellent interactive graphic with analysis of the key points. It is now beyond doubt that the agreement reached at the conference will have a major impact on all sectors of industry at a local, national and global level. The world is taking climate change seriously and governments, businesses and civil society will all need to be part of the solution.
Some clear leaders of industry were present in Paris and are emerging as champions of transition. A growing number of the world’s most influential and iconic companies are signing up to science based targets and are joining the RE100 list committing to a 100% renewable energy future. The heads of these companies understand the risks of climate change and the economic benefits of transition, and actively encouraged governments to agree a strong and binding deal to reduce emissions, many called for carbon pricing and all are working hard to prepare their businesses by adopting energy efficiency measures, building and buying renewable electricity and heat and assessing their supply chains for climate resilience and compliance with their publicly stated ambitions.
1,000 Mayors take up the transition challenge.
Another area of much activity in Paris was the local government arena. We of course needed central governments to agree a legally binding deal in Paris but local and regional administrations have been leading the way with many cities and regions setting their own agenda and signing on to the carbon-neutral and 100%RE ambition. Mayors of major cities from around the world got together to commit to a low carbon transition.
Those enlightened people from Carbon Tracker were working hard in Paris, informing proceedings on issues of stranded assets, divestment from fossil fuels and the benefits of investing in renewable energy. The stark warning to investors was that acting on climate change, as governments have stated they will, means declaring a large proportion of fossil fuel reserves un-burnable, wiping many $billions off the value of fossil fuel companies. This comes as no surprise to those companies as they have known about climate change and the likely impacts for many years although the message has been slow to reach their investors. Carbon tracker is a philanthropically funded, not for profit organisation comprising highly experienced financial, energy and legal professionals.
UK government challenged over climate hypocrisy
The mismatch of David Cameron’s fine words in his opening address to the conference and George Osbourne’s domestic war on renewables did not go unnoticed in Paris. “On eve of Paris summit, Britain pulls plug on renewables” read a recent headline in the Washington Post. While China, India and the USA, as well as many smaller nations, have been announcing huge investment into renewables and a curtailment of fossil fuel extraction since COP21, the UK government has announced it is allowing fracking under national parks and slashing subsidies for renewable energy!
What’s next for UK renewables?
The advantage the UK’s commercial renewables industry has … is timing. The tariff cut comes just as the world has been called to arms in the war on climate change, international companies are committing to renewables and the cost of those renewables has plummeted in recent years. Micro-generation of heat and power, energy efficiency, and waste management are all becoming good business practices and van and car fleets are going electric, improving the case for domestic and commercial PV and solar carports. PR firms have been slow to promote their clients’ green credentials but this is beginning to happen and when consumers start to vote with their wallets we will have reached the tipping point.
The lack of leadership from PM Cameron is no excuse for inaction, Mark Carney, the Bank of England Governor, has very clearly warned that climate change is one of the biggest risks to economic stability and environmental law firm, Client Earth, are ready to hold companies to account if they fail to address and report climate risk to shareholders. Carbon Intensive companies scrutinised
At the utility scale, developers are already preparing to build solar farms without incentives and the falling price of battery storage will encourage all sectors of the market from utility to residential. There will be a slowdown in deployment in the short term due to policy uncertainty but, following the COP21 agreement, the low-carbon transition is inevitable and the UK renewables industry will continue to play its part.