The COPs are gunning for your net zero target
How much or how little was achieved at COP will vary depending on your position at the table but despite the lukewarm commitments, at least two interesting threads can be pulled out of the proceedings.
The first and arguably most important is that carbon pricing is closer, though the market envisaged to trade it looks flimsily constructed. Second is that means of tracking the lofty commitments made by corporates are likely to get more scrutiny in the future.
Carbon trading rules were put into place by the COP summit after six years of discussion and negotiation, paving the way for a boom in the trading of emissions credits. Known as Article 6, they emerged after days of wrangling over the details to establish a framework for trading credits for a tonne of carbon reduced or removed from the atmosphere.
The framework is expected to channel a surge of funds into suspect and unproven schemes that generate credits — such as tree planting projects and direct air capture — which are bought by those looking to offset their emissions.
The new framework will be comprised of two parts: a centralised system open to the public and private sectors, and a separate bilateral system that will allow countries to trade credits that they can use to help meet their decarbonisation targets, the Financial Times reported.
However, climate experts expressed concerns that a compromise in the rules would allow millions of old credits into the new system. Part of the Kyoto protocol, the credits are considered to be of poor quality, with doubts that they represent the climate benefits they promise.
Created between 2013 and 2020, these credits could potentially flood the market with cheap units that depress prices, according to Gilles Dufrasne, policy officer at Carbon Market Watch who told the FT: “The zombie credits have been given renewed life and could continue to be used for the next decade, cleansing climate targets on paper but spoiling the atmosphere in reality.”
Meanwhile there is a growing sense that carbon emissions and their measurement are going to become a personal or corporate responsibility beyond self-reporting.
The head of the United Nations has convened a group to police net-zero commitments and that he expects first recommendations on how to do this over the next 12 months.
UN Secretary-General Antonio Guterres told the Global Climate Action event that the world “needs to hold each other accountable – governments, non-state actors and civil society.” He gave details on the High-Level Expert Group that he’s established to give more consistency around demonstrating net zero targets.
The COP26 climate summit saw a deluge of pledges to fight global warming – with many coming from the global shipping industry, which is both hard to decarbonise and harder to track. Eyebrows were raised in particular when the Glasgow Financial Alliance for Net Zero announced that more than 450 firms representing $130 trillion of assets had signed up to the commitment, Bloomberg reported.
But this headline number was met with scepticism as climate activists and NGOs questioned whether global high finance is really capable of rapidly weaning itself off fossil fuels. Especially since the companies that signed up include those who continue to chase deals that are more likely to increase their carbon footprint rather than reduce it.
Guterres said GFANZ should apply stricter membership criteria by adopting the tougher targets and transparency of the Net-Zero Asset Owners Alliance, a sub-sector initiative of the $130 trillion grouping.
Meanwhile the man who never was US President is still around and unveiled what reads at first sight like a means of tracking all the carbon in the world, all at the same time.
Climate TRACE – a collaborative effort between Al Gore, think tank RMI, TransitionZero, WattTime and others, comprises organizations from the tech sector that have pioneered some of the most-powerful software-based emissions-monitoring solutions in the world, in part using artificial intelligence, land-based remote sensing and speculative satellite data.
Gore has form here not just in the climate debate. Climate TRACE’s first report in September made headlines for finding significant discrepancies between emissions that were reported to the UN under the 1992 climate treaty, and their independent estimates.
A technology-based response to a deepening climate crisis is nothing new but it demonstrates the sort of collaboration so often talked about in shipping but so rarely practised.
Since shipping companies are self-reporting their emissions under IMO DCS and EU MRV and doing so in an analogue way, there seems little doubt that actual emissions are below these estimates. And with many of them being sold voluntary and questionable offsetting as a means to reduce their carbon balance sheet, the industry needs the right plug in the right socket. Without it, the system won’t work.