Climate Change

Put a price on it

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industry-611668_1920Having spent this summer interning at Equinor*, one of my key takeaways is about the importance of carbon pricing.

Prior to joining the Norwegian energy giant, carbon pricing was something I had only ever considered as part of my undergraduate economics degree. However, Equinor is a great example of how effective a carbon tax can be. In 2016, the company’s upstream oil and gas portfolio had a carbon intensity (i.e. the amount of carbon emitted per barrel produced) of 10kg of CO₂ per barrel of oil equivalent, compared to an industry average of 17kg. Equinor is aiming to reduce this to 9kg by 2020 and 8kg by 2030. Both targets look within reach.

In large part, Equinor’s high carbon efficiency is driven by the carbon tax that has been in place in Norway since 1991. According to the OECD’s Effective Carbon Rates 2016 publication, in 2012, in Norway, 38% of carbon emissions are subject to a price at or above EUR 30 per tonne of CO₂, 81% are subject to a price at or above EUR 5 per tonne of CO₂ and only 19% of carbon emissions are subject to no price at all. This compares to only 10% of emissions across all other countries being subject to a price at or above EUR 30 per tonne, 30% of emissions being subject to a price at or above EUR 5 per tonne and a massive 60% of emissions not being subject to any price at all. The highest carbon tax in Norway is EUR 56.

So what does carbon pricing mean and how does it actually work? Putting a price on carbon means putting a cost on the emission of carbon dioxide (and other greenhouse gases). This internalises the otherwise external and unpaid for cost of emissions (such as the cost of climate change) and puts the responsibility back on the emitter to either reduce emissions or pay for the right to emit. A carbon price creates an economic signal for emitters and enables them to incorporate the price into their financial planning. It encourages them to improve efficiencies and pursue clean technology innovations as the lower their emissions are, the less they are required to pay. Hence, Equinor’s low carbon intensity. It also informs investment decisions, promoting cleaner alternatives.

Carbon pricing can be introduced either in the form of a tax or an emissions trading system (ETS). A carbon tax puts a direct cost on each tonne of greenhouse gas emitted or on the carbon content of fossil fuels. This does not determine how much emissions will be reduced by, but it sets a firm price on carbon. An ETS caps the total permissible emissions within a given area. Low emitters are permitted to sell their carbon credits to higher emitters thereby establishing a market price for carbon. The cap ensures that overall emissions are reduced.

Carbon pricing initiatives are becoming more common and acceptable. In 2018, 20% of global greenhouse gas emissions are covered by carbon pricing initiatives, which have now increased to a total of 51 worldwide. These include:

  •  The EU introduced the world’s first international carbon trading system in 2005. It remains the world’s biggest carbon market, but it has been plagued since inception by problems of credit over-supply and a poor pricing mechanism. Nevertheless, a post-2020 reform plan has been agreed pursuant to which the cap on aggregate emissions will be lowered at a faster pace. The market surplus is set to fall by more than 1 billion tonnes (more than 60%) between 2019-2023. The allowance price has responded by increasing from 4-5 EUR per tonne of CO2 in April 2017 to a 12-14 EUR per tonne range one year later.
  • Countries across Central and South America have embarked on introducing a variety of carbon pricing mechanisms. Argentina adopted a carbon tax of US$ 10 per tonne of CO2 in December 2017, which is expected to cover about 20% of the country’s greenhouse gas emissions. Colombia has introduced a carbon tax on all liquid and gaseous fuels used for combustion. Revenues raised are being earmarked for the Colombia in Peace Fund to support ecosystem protection and coastal erosion management. Chile introduced a carbon tax in January 2017, which is intended to help the country meet its aim of cutting its greenhouse gas emissions by 20% below 2007 levels by 2020. In 2017, Mexico launched a year-long ETS simulation. On the back of this experience, it has now started a pilot ETS which is expected to be formally launched in 2022.
  • Countries in Asia are also looking into carbon pricing, most notably China, which launched a national ETS in December 2017. Once fully operational, this ETS is expected to be the largest in the world.

One notable exception to the general trend of adopting carbon pricing is the US. Last month, Carlos Curbelo, the Republican member of the House of Representatives proposed a bill to introduce a carbon tax of US$ 24 per tonne of CO2 to be levied on coal mines, refineries, gas processing plants and other industrial facilities. Revenues raised would be used to abolish a federal tax on petrol, invest in roads and bridges and smaller amounts would go towards grants for low-income families, flood protections and research into energy innovation. However, it looks very unlikely that Mr Curbelo’s bill will ever be adopted in law as the same week the House passed a resolution arguing that “a carbon tax would be detrimental to American families and businesses, and is not in the best interest of the United States”. Nevertheless, even if the US federal government does not seem in favour, individual states, including California, Washington and Massachusetts, have either introduced or scheduled the introduction of an ETS. This indicates that, just as the “We Are Still In” coalition in response to President’s Trump decision to withdraw from the Paris Agreement, action at the sub-national level in the US may yet introduce countrywide carbon pricing through the back door.

The final piece of the puzzle is the private sector. In recent years, internal carbon pricing has emerged as an effective mechanism to help companies manage the risks and evaluate the opportunities of embarking on the transition to low carbon. In 2017, 1300 companies disclosed that they currently use an internal price of carbon or intend to do so within two years. This includes over 100 Fortune Global 500 companies with combined annual revenues of approximately US$ 7 trillion. Incidentally, Equinor applies a US$ 50 internal price of carbon outside of Norway.

Momentum towards the introduction of carbon pricing across the board is clearly building – economists, business and many governments agree that this is an elegant and effective way of reducing emissions and dealing with climate change. However, huge emitters in the Middle East, Russia and India remain outside the fold, together with, of course, the US government. This does not prevent business from leading the way by introducing internal carbon pricing and focussing on investments into cleaner, more efficient solutions, which in turn will make them more profitable in the long-run. Time to take the baton!

*Disclaimer: All views expressed in this blog post are my own and are not intended to reflect or represent the views of Equinor or any of its employees.

What’s in a name?

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pinwheel-2222471_1920A lot it would seem, if you’re a large oil and gas company repositioning yourself as a low-carbon committed energy company. So, on 15 March, Statoil announced that it would be changing its name to Equinor, a name that signals equality and a return to its Norwegian roots. The proposed name change is now subject to a shareholder vote at the company’s AGM on 15 May but given the support of the Norwegian government, which is a majority shareholder, it is unlikely that there will be any dissent. The name change, which is rumoured to cost approximately US$32 million, will remove “oil” from the company’s name and fits nicely with its low carbon strategy unveiled last year. Will the new name embolden the company to accelerate its transition to a sustainable energy mix ahead of its current 2030 milestone? Time will tell.

Statoil’s name change comes after Orsted (previously Dong Energy) underwent a similar name transformation late last year. Orsted is a Danish energy company that started its existence with a heavy dependence on coal. It began its green transformation about a decade ago, phasing out coal consumption by 73% in 2017 and targeting a full withdrawal from coal by 2023. The company also divested all of its oil and gas assets in 2017 and is focussing on being a global leader in offshore wind. It currently holds a 25% market share in the industry, powering 9.5 million people. Its aim is to power 30 million people by 2025. The name Orsted is a homage to Hans Christian Orsted, a Danish scientist who discovered electromagnetism.

Full scale name changes are not the only ways the big oil and gas companies are trying to prove their commitment to the energy transition. Companies, such as Shell, are rebranding themselves as full service “energy” companies (not oil and gas companies). Indeed Shell is currently being pressed by an activist shareholder group to make a radical shift away from fossil fuels. This shareholder group, called Follow This, contends that Shell’s current commitment to reduce its carbon footprint by 50% by 2050 is not sufficient to meet Paris Agreement thresholds. A similar resolution brought by Follow This last year was rejected by 94% of Shell’s shareholders. However, with climate change, the Paris Agreement and global warming now regularly in the headlines, perhaps this  year the resolution will find more traction, especially following this week’s publication by Shell of the radical Sky Scenarios report. The report focusses on technically feasibly but challenging steps that need to be taken over the next 50 years to ensure the Paris Agreement targets are met. The seven key steps outlined in the report are:

“1. A change in consumer mindset means that people preferentially choose low-carbon, high-efficiency options to meet their energy service needs.

2. A step-change in the efficiency of energy use leads to gains above historical trends.

3. Carbon-pricing mechanisms are adopted by governments globally over the 2020s, leading to a meaningful cost of CO 2 embedded within consumer goods and services.

4. The rate of electrification of final energy more than triples, with global electricity generation reaching a level nearly five times today’s level.

5. New energy sources grow up to fifty-fold, with primary energy from renewables eclipsing fossil fuels in the 2050s.

6. Some 10,000 large carbon capture and storage facilities are built, compared to fewer than 50 in operation in 2020.

7. Net-zero deforestation is achieved. In addition, an area the size of Brazil being reforested offers the possibility of limiting warming to 1.5°C, the ultimate ambition of the Paris Agreement.”

Source: Sky Scenarios report, Shell

The increased activity among the large oil and gas companies to embrace transition is commendable. Whether they are doing this out of genuine concerns for the future of the planet or because investors are now rapidly starting to pull out of oil and gas stocks is debatable. Either way, though, provided the net effect is that we witness a sustainable realignment of the energy mix, all such news is good news.

 

 

Sustain a Future’s 2017 Review

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design-2711676_19202017 was a year when sustainability, climate change and emissions reductions came to the fore on both private and public agendas. And so as we tumble towards 2018, I would like to do a run-down of the year’s developments that are helping to sustain a future.

Paris Agreement

One of the biggest developments early in 2017 was President Trump’s decision to pull out of the Paris Agreement (see blog). However, this only served to galvanise worldwide support for the agreement and as of today, 172 out of 197 countries have ratified it. The President’s actions also gave birth to the “We Are Still In” movement of over 2700 US companies, cities and states, together representing $6.2 trillion of the US economy, coming together to pledge allegiance to the Paris Agreement goals and ensure that America abides by its commitments, even when it withdraws from the agreement. The US withdrawal has also opened the door for Emmanuel Macron to become a leading voice in the fight against climate change, as evidenced at the One Planet Summit this December.

Electric vehicles

2017 also saw a reassessment of forecasts relating to electric vehicles. In a report published in July, Bloomberg New Energy Finance stated that it estimates that by 2040, 54% of new car sales and 33% of the global car fleet will be electric (see blog), a much more bullish forecast than it had issued just a year before. Added to this, a number of countries and car companies announced the ban or phase out of petrol-only vehicles. For example, Volvo announced that it would be going all-electric with every car in its range to have an electric train by 2019 and the UK and France announced a ban on the sale of new petrol and diesel cars from 2040.

Renewable power generation

Records were set in renewable energy generation in 2017. In the UK, low-carbon energy sources made up 52% of the energy mix throughout the year, making 2017 the “greenest” year on record for the UK. The country also succeeded in having a full 24 hours of coal-free power generation in May 2017 (see blog). Furthermore, in October 2017, wind power provided nearly a quarter of all energy generation in Europe as a whole. These records have been assisted by the continued falling costs of solar and wind power technology and renewed investment in renewable energy infrastructure. For example, earlier this year the world’s first floating wind farm came into operation offshore Scotland, operated by Statoil.

Business initiatives 

On the business side, the RE100 group of companies committed to 100% renewable power (see blog) grew again this year to 116 members including Google, Apple, Unilever,  Walmart, ABInv Bev…to name but a few! These huge, multinational companies have each set the goal of obtaining 100% of their electricity from renewable sources within the next decade or so. Traditional oil and gas companies have also embarked on the energy transition journey. Shell now commits $1 billion annually to investments in clean energy. BP is committed to a lower-carbon future with a move towards greater investments in gas and carbon capture and storage technology. Both companies are also members of the Oil and Gas Climate Initiative (see blog), which includes the world’s biggest oil and gas companies. These companies have committed US$1 billion of funding to be invested over the next decade in innovative technologies and start-ups which propose solutions to substantially reducing greenhouse gas emissions.

Plastic pollution

2017 also witnessed the first UN Ocean Conference, which highlighted the plight of our oceans due to growing plastic pollution and climate change (see blog). The Ocean Conference raised $5.24 billion in commitments to protect the oceans and created a Call for Action which affirmed the signatories’ “strong commitment to conserve and sustainably use our oceans, seas and marine resources for sustainable development”.  Greater awareness of the dangers of plastic pollution have also resulted in individual action to fight plastic pollution, including the Ocean Cleanup whose plastic waste collection system aims to remove half of plastic waste in the Great Pacific Garbage Patch in five years; Adidas teaming up with Parley to develop trainers out of plastic and Plastic Odyssey which has developed a boat that can be powered by plastic.

A look to the future…

So what are the predictions for 2018? I think that the key themes will be:

  • a broader conversation about peak oil, but due to falling demand rather than supply;
  • the role of gas in the future energy mix;
  • the use of blockchain to facilitate peer to peer energy transactions;
  • the rise of electric vehicle alternatives, such as the hydrogen motor; and
  • more innovative uses of existing technologies – such as the solar panelled motorway in China that intends to charge cars as they drive using wireless technology.

It’s been an eventful year and so for now, I wish you all a very happy and prosperous New Year!

COP23 Roundup

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downloadLast week, the latest UN Climate Change Conference was held in Bonn, Germany. It was the first such conference to take place since the US’s withdrawal from the Paris Agreement and with Syria becoming a signatory during the conference, the US is now the only country in the world not to be a party to the agreement.

The conference again brought the topic of climate change to the centre of the international political arena and amid the general calls for action and greater urgency, concrete commitments were made. I will discuss some of the key take-aways here.

1. Launch of Powering Past Coal Alliance 

The UK and Canada spearheaded the launch of a new initiative aimed at phasing out traditional coal power. Although there is no firm timeframe commitment, the alliance’s declaration states that traditional coal power needs to be phased out by no later than 2030 in the OECD and EU28, and no later than 2050 in the rest of the world.

The alliance was joined by more than 20 entities including Denmark, Finland, Italy, New Zealand, Ethiopia, Mexico, the Marshall Islands and the US states of Washington and Oregon. Michael Bloomberg also pledged $50m to expanding his anti-coal US campaign to Europe.

However, notable abstainees from the pledge included the US, China, India and Germany.

2. Launch of Ocean Pathway Initiative

With Fiji holding the rotating presidency at COP23, it was expected that there would be an initiative focussing on the oceans and climate change. As a Pacific Small Island Developing State (SIDS), Fiji is particularly vulnerable to the destructive effects of climate change on the oceans, through rising sea levels to overheating.

The Ocean Pathway initiative has reaffirmed the Call for Action issued at the UN Ocean Conference earlier this year and seeks funding for ocean health and maintenance of ecosystems from UN climate change funding initiatives. The initiative has also launched the Oceans Pathway Partnership to link existing ocean activities and promote cooperation.

3. Financing climate action

During the conference, a number of significant funding commitments were announced, including:

  • Adaptation Fund: This fund, established under the Kyoto Protocol, finances projects and programmes that help vulnerable communities in developing countries adapt to climate change. To date, it has committed US$462 million in 73 countries. This year, it was officially committed to serve under the Paris Agreement framework and country contributions have exceeds the 2017 target with contributions of EUR 50 million from Germany and EUR 7 million from Italy.
  • Norway and Unilever fund: US$400 million fund established for public and private investment in more resilient socioeconomic development. The fund will invest in business models that combine investments in high productivity agriculture, smallholder inclusion and forest protection.
  • Amazon rainforest fund: Germany and the UK have committed US$ 153 million to fight climate change and deforestation in the Amazon rainforest.
  • Initiative 20×20 investment: World Resources Institute announced a US$ 2.1 billion investment to restore degraded lands in Latin America and the Caribbean.

4. Launch of Below50 Initiative

The World Business Council for Sustainable Development (WBCSD) launched the below50 initiative, initially in North America, South America and Australia, to create greater demand and more markets for sustainable fuels, i.e. fuels that produce at least 50% less CO2 emissions than conventional fossil fuels. The initiative aims to bring together the entire value-chain for sustainable fuels and scale up their deployment.

Finally, despite US’ withdrawal from the Paris Agreement, Michael Bloomberg’s “We’re Still In” coalition of US cities, states and companies, was out in force at COP23, showing the world that large parts of America are still fully committed to the targets set out in the Paris Agreement.

And as the conference delegates begin to reflect on the week’s achievements, the biggest hope is that the commitments are kept and promises are delivered. With record levels of funding now being directed towards tackling climate change, there really is no excuse not to act.

 

 

 

ChangeNOW!

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image1 (4)This weekend your blogger went along to the inaugural ChangeNow! conference in Paris. The conference describes itself as one of the first international events on the topic of “innovations for good”. It focussed on the UN Sustainability Goals in the fields of energy, circular economy, healthcare, education, sustainable cities and tech for good.

A couple of key take-aways from the conference:

Energy

On the topic of energy, we heard from a variety of speakers, including Jerome Schmitt, Senior VP Innovation and Energy Efficiency at TOTAL Gas and Power, Dr Michael Dorsey, full member at the Club of Rome, global energy expert and co-founder and principal at Around the Corner Capital, and energy industry disruptors Meteoswift, Echy and Zephyr Solar. A number of key themes emerged.

Firstly, Jerome Schmitt discussed the important role that traditional oil and gas companies should play in the energy transition. He acknowledged that companies such as TOTAL are not safe from renewable energy and clean tech distruptors. However, the cost and technology race in solar and wind power over the last few years has actually resulted in many start-up renewable energy companies going bankrupt. Schmitt believes that oil and gas companies should partner with renewable energy companies and provide the necessary funding to enable them to scale-up. For example, since 2011, TOTAL has owned a majority stake in Sunpower, a solar energy company.

Secondly, both Jerome Schmitt and Michael Dorsey discussed the trend of decentralisation in the energy supply industry with the rise of microgrids and the use of blockchain technology to permit peer-to-peer energy supply. However, Dr Dorsey contended that large utility companies may drag down such innovative progress by preventing third parties from supplying existing grids or by lobbying governments to introduce restrictive regulations.

Thirdly, one other way that the energy industry may evolve is through the development of innovative non-electricity reliant solutions. For example, Echy has developed technology to harness sunlight to light-up buildings with natural daylight. The technology results in electricity savings of approximately 68% as Echy lighting does not use electricity. Many of the speakers predicted that more and more such non-electricity reliant solutions will come to the fore in the next 5-10 years.

Tech for good

The theme of tech for good was prevalent throughout the entire conference. Ynse de Boer, Managing Director at Accenture, delivered the introductory talk on this topic.

De Boer proposed four ways to ensure that technology is used as a force for good. Firstly, companies using technological solutions must ensure that their customers are protected, supported and educated about how their data and information are used. Secondly, businesses and governments need to anticipate that the jobs of the future will not be the same as the jobs of today but instead of using technology to eradicate jobs, it should be used to complement them, improving productivity. Thirdly, technology should be directed towards delivering innovative products and services and used to solve largescale social issues. Finally, technology should be used to create transparent and inclusive value chains, facilitated through the use of mobile and digital technology.

According to de Boer, governments, business and not-for-profit organisations all need to work together to ensure that technology is used efficiently and always as a force for good.

Cleaning the oceans

The session on ocean clean-up introduced three different companies that are working on cleaning up our oceans – TheSeaCleaners, Adidas and Plastic Odyssey.

TheSeaCleaners work on removing rubbish from seas, harbours and oceans. Since 2002, their team has removed over 5.1 million litres of rubbish and they are continuing to gain momentum.

Adidas has recently teamed up with Parley to develop a range of trainers made from discarded plastic. According to Adidas, each pair of these trainers prevents approximately 11 plastic bottles from entering the oceans.

Finally, Plastic Odyssey are working to create innovative, small scale, local solutions to plastic waste. They are developing a boat that will spend three years travelling between Africa, Asia and South America, fuelled exclusively by plastic collected from the oceans and converted into fuel. The boat will stop off at numerous locations to work with local communities to understand their recycling needs and develop unique solutions.

The conference also included sessions on the future of agriculture, healthcare and the creation of sustainable cities.

It was heartening to see such enthusiasm and creative buzz for positive impact projects and issues. Governments and business can no longer ignore the need for purposeful investment and regulatory structures that are favourable to the social entrepreneur. The trend has started and it won’t be long before it really takes off! Are you ready?

G20 2017 Climate and Energy Action Plan

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light-bulbs-1125016_1920

Among the many topics discussed at this year’s G20 Summit, was climate and energy. The summit culminated in the issue of a joint declaration summarising the agreements reached and the plans adopted by the G20 leaders. With respect to climate and energy, the declaration was decidedly split between the “G19” and the US, acknowledging the US’ desire to pull out of the Paris Agreement and its continued support for the use of fossil fuels, albeit “more cleanly and efficiently”.

As part of the summit, the G20 leaders also adopted the G20 Hamburg Climate and Energy Action Plan for Growth. The Action Plan  identifies six key areas of development, which include developing strategies for long-term low greenhouse gas emissions; creating a reliable and secure framework for the transition of the energy sector, which involves the promotion of energy efficiency and the scaling up of renewable and other sustainable sources of energy; realising access to modern and sustainable energy services for all; and aligning finance flows.

Although only the last-mentioned area of development specifically refers to finance, a recurring theme throughout the whole Action Plan is the need to secure more private and public investment. And this seems to be one of the biggest hurdles to meeting the Paris Agreement targets and to transitioning to clean energy.

The Action Plan identifies that significant levels of investment, both private and public, will be required to modernise infrastructure in line with the Action Plan’s goals and to continue the scaling up of renewable and sustainable energy. In addition to achieving climate and energy goals, such investment is likely to also generate local growth, employment and help with poverty eradication. Addressing several Sustainable Development Goals at the same time!

The Action Plan specifically notes the role played to date by Multilateral Development Banks (MDBs) in mobilising “climate finance” and calls on them to further enhance their involvement. In 2015, the following MDBs, the African Development Bank, the Asian Development Bank, the European Bank of Reconstruction and Development, the European Investment Bank, the Inter-American Development Bank and the World Bank Group, issued a joint statement at COP21 committing to work together to “substantially increase climate investments from public and private sectors to support”. This existing commitment is applauded but the Action Plan further encourages the MDBs to cooperate and coordinate efforts to finance ambitious energy and climate adaptation and mitigation projects and new technologies, and to identify how the private finance sector can assist with meeting the 2030 Agenda objectives and the Paris Agreement goals.

The investment question has also be considered in detail in the UN Green Finance Report published on 14 July 2017 by the UN Environment Programme (UNEP). The report identifies that the G20 in particular has made significant progress in mobilising private and public capital for climate and clean energy developments and initiatives. An example, is the recent joint commitment by eleven global banks to develop tools for assessing climate-related financial risks and opportunities; and to make more disclosures in relation to climate investments, making the sector more transparent. The banks are ANZ, Barclays, Bradesco, Citi, Itaú, National Australia Bank, Royal Bank of Canada, Santander, Standard Chartered, TD Bank Group, and UBS.

Commenting on the new Green Finance Report, the Executive Director of UNEP, Erik Solheim said: “This new research […] shows encouraging progress in this regard. From a record number of new green finance measures to ambitious plans for green finance hubs, we are seeing the smart money move to green financing.” He further added: “The challenge now is to rapidly increase capital flows to investments that will support our sustainable development objectives and create commercially viable green businesses for decades to come.”

The challenge has been set and the rewards are great economically, environmentally and socially. So let’s hope the investment starts to flow in the right direction!

BF(O)G – big friendly oil & gas

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oil-rig-2191711_1920I have always believed that a clean energy revolution can only be achieved with support and buy-in from the big oil and gas companies. It seems that many such companies are now starting to agree.

A few years ago, 10 major oil and gas companies, between them responsible for over 20% of world oil and gas production, came together to form the Oil and Gas Climate Initiative (OGCI), an “initiative which aims to show sector leadership in the response to climate change“. The ten companies are BP, Total, Statoil, CNPC, eni, Pemex, Reliance Industries, Saudi Aramco and Shell.

The initiative’s mission is to work together to achieve notable reductions in greenhouse gas emissions from the oil and gas industry, while still meeting world energy demand. At present, the OGCI is focussing its efforts on three working groups – Low Emissions Roadmap, Carbon Capture, Utilisation and Storage, and Managing Methane Emissions.

It has also prepared an interesting matrix which maps actions identified by the IEA as having the potential to reduce greenhouse gas emissions sufficiently by 2040 to remain on track for a 2°C scenario against the oil and gas industry’s ability to influence such actions. This matrix is reproduced below (source: OGCI):

aboutus-infographic-2017-b

In November 2016, the companies behind the OGCI finally put their money where their mouth is and set up OGCI Climate Investments, a partnership with a committed US$1 billion of funding to be invested over the next decade in innovative technologies and start-ups which propose solutions to substantially reducing greenhouse gas emissions. The partnership will operate out of Imperial College London’s White City Campus, bringing it into direct contact with the Better Futures initiative recently launched by the Mayor of London (see my blog on this). OGCI Climate Investments appointed its first CEO, Dr. Pratima Rangarajan, in May 2017 which hopefully means that it will now come into full operational mode.

I hope that both the initiative and the investment partnership will actively push ahead with their stated aims and that we will begin to see the fruits of their labour in the not too distant future. I also hope that other oil and gas companies will join their cause.

 

 

Better Futures for London

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panorama-947410_1920On 12 June, London Mayor Sadiq Khan, launched a £1.6m clean technology incubator at London’s Tech Week.

The incubator, known as “Better Futures“, aims to provide funding and other technical and business support to over 100 technology start-ups in London which focus on clean technology innovation, low-carbon solutions and combatting the problem of climate change. It is hoped that the incubator will spur on the creation of a clean technology hub in London.

The incubator is being funded by the European Regional Development Fund and is a collaboration between the Mayor of London, Imperial College London, Imperial College London Consultants, OPDC (Old Oak and Park Royal Development Corporation) and Sustainable Bridges C.I.C.

Indeed, as part of the incubator package, some qualifying start-ups will be given the opportunity to pursue their research at Imperial College’s Centre for Cleantech Innovation.

In addition to launching the Better Futures incubator, the London Mayor also announced his desire to transform London in the world’s leading smart city. According to a recent report by IESE Centre for Globalisation and Strategy, London is already Europe’s leading smart city, and is second only to New York in the global rankings. The Mayor was quoted as saying: “The potential for cutting-edge technology to tackle a host of social, economic and environmental challenges is immeasurable.  From air pollution and climate change to housing and transport, new technologies and data science will be at the heart of the long-term solutions to urban challenges.”

Initiatives such as the incubator and the drive to make London the world’s leading smart city are crucial at this time as London begins to find a role for itself in a new, post-Brexit role. More of the same, please, Mr Khan!

 

“We’ll always have Paris”…continued

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IMG_2427aIn my original post about Trump’s withdrawal from the Paris Agreement, I discussed Michael Bloomberg’s efforts to replace the outgoing USA with a new signatory consisting of a coalition of American states, cities and companies. Positive steps have now been taken in this direction.

The coalition has issued an open letter entitled “We are still in“, pledging allegiance to the Paris Agreement. It now boasts over 1400 signatures.

During a G-7 environment meeting in Bologna, Italy earlier this week, Patricia Espinosa, executive secretary of the United Nations Framework Convention on Climate Change, announced that she will work towards enabling regions, cities and other sub-national players to join the Paris Agreement officially.  It is still unclear how this would work in practice, but the political will is there to ensure that even if America withdraws, the efforts and contributions being made by its states, cities and companies are not ignored.

In a bold move on 6 June, Hawaii passed legislation affirming its dedication to the Paris Agreement. It is the first state to officially confirm its position and hopefully, this will pave the way for other states to join.

The G-7 meeting concluded with the issue of a communique signed by all ministers, other than the US (whose representative only attended one session of the two day event). This communique reaffirmed international commitment to the Paris Agreement and also addressed other sustainability issues, including ocean pollution, energy efficiency and the need for increased funding to assist with reaching the sustainability goals.

 

“We’ll always have Paris”

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IMG_2427a…So goes the iconic phrase from the end of Casablanca. However, on 1 June 2017, President Donald Trump announced the US’ withdrawal from the widely respected Paris Agreement on climate change. What implications could this have for the agreement’s success? Unlike Ilsa and Rick from Casablanca, could it be that we will not always have Paris?

The Paris Agreement, adopted on 12 December 2015 and, as of today, ratified by 147 out of 197 signatories, is a commitment towards a sustainable, low carbon future. Its key aims are to curb global warming to 2 degrees Celsius above pre-industrial levels and to equip countries to deal with the consequences of climate change.

According to President Trump, the agreement is at odds with his “America First” mantra as complying with its terms could result in an apparent loss of 2.7 million US jobs. However, President Trump’s decision, somewhat counter-intuitively, may have actually galvanised support for the Paris Agreement around the world and given it an even greater impetus.

In Europe: Immediately on the back of President Trump’s announcement, Italy, Germany and France issued a joint statement reiterating these countries’ commitment to the Paris Agreement, stating that “We deem the momentum generated in Paris in December 2015 irreversible and we firmly believe that the Paris Agreement cannot be renegotiated, since it is a vital instrument for our planet, societies and economies“.

In America: Tesla’s Elon Musk and Walt Disney’s Bob Iger have announced their intentions to resign from White House advisory councils. And even more impressively, Michael Bloomberg is now spearheading the creation of a coalition of thirty American cities, three American states, and over 100 American companies which pledges to uphold America’s obligations under the Paris Agreement and even attempt to replace it as a signatory, once America fully withdraws. The coalition is currently in negotiations with the UN to be accepted as a signatory entity. This blog will follow the developments of this coalition.

In China: China also made it clear at the recent EU-China summit in Brussels that it considered President Trump’s actions to be an error. Although the summit was expected to produce a formal statement of cooperation on climate change between the EU and China, disagreements over trade intervened. Nevertheless, China has proven that it has an appetite for renewable energy with US$102.9 billion worth of investments into renewable energy in 2015* (however, falling to US$78.3 billion in 2016*) and with its Longyangxia Dam Solar Park becoming the world’s largest solar farm earlier this year. Here’s hoping therefore, that a formal cooperation statement between the EU and China will be forthcoming in the not too distant future…let’s watch this space.

In conclusion: President Trump’s withdrawal from the Paris Agreement does inevitably deal a blow to its ambitions. However, signatories and stakeholders around the world do not seem phased by his actions and indeed seem to have used his stance as a uniting counter-point. So yes at this stage, I think it is fair to conclude that we will always have Paris and in the words of Emmanuel Macron, there is substantial international commitment to “make the planet great again“.