Week 2

Hangover:

What's black and white and red all over? In the Arctic, a sun-burnt polar bear; on the Clyde, the stretched expressions of delegates tottering off evening trains at Glasgow Central Station.

This is a COP which, added urgency aside, is also the first of its kind to feature world leader speeches in week one rather than two. The upside is momentum and urgency within the following negotiations. The downside is expectations are stratospheric and the diplomatic pressure staggering. The stakes have been set very publicly, and anything short of week one’s announced commitments will be too.

Which makes the UK’s spurning of the Beyond Oil and Gas Alliance, an agreement committing countries to an end date for exploration and extraction, somewhat embarrassing. Presumably drawing inspiration from the huge queues outside conference entrances this week, a source at the Department for Business, Energy & Industrial Strategy said future licensing rounds would be accompanied by a “climate compatibility checkpoint”, The Times reports.

Monday’s equally novel commitment tackling the elimination of new car emissions by 2040 was an equally damp squib, implicating one quarter of the world’s cars but lacking signature’s from four of the world’s five largest carmakers and from China and the US - the world’s two largest car markets.

So it was fitting that former minister and Jaguar-obsessive John Prescott had travelled to the summit racing-green-free as he joined the Prime Minister’s (sheepish) train-based arrival in Glasgow for a diplomatic Hail Mary to steer negotiations back on track. This follows COP President Alok Sharma's admission earlier in the week that “clearly not enough” progress had been made, after a report found that pledges will fail to dent the planet’s trajectory for 1.5 degrees of warming by 2030. However, on Wednesday night both China and the US agreed that cooperation on climate action and work to achieve the 1.5◦C temperature goal set out in the 2015 Paris Agreement would be boosted. Whatever that means in practise, it is the first, albeit reprehensibly last minute, sign of genuine bilateral comradery.

Meanwhile, CBI Director Tony Danker indelicately reiterated his view that greenwashing was “a minority sport” in business in Tuesday’s panel at the New York Times Climate Hub. But he did describe the business case for green transition as a “strategic imperative”, with discussion hovering over the problem of carbon pricing alignment between countries. This is a lynchpin issue. If the world is serious about leveraging the private sector as a decarbonisation tool, as was declared with regal pomp last week, businesses cannot be left locked-in to market forces which haven’t been ‘rigged’ green through effective legal frameworks and carbon-priced obstacles and opportunities under Article 6.

Climate finance and mandatory transition planning announcements are positive steps in terms of available capital volume and regulation sentiment. But recent history suggests that if either are to be effective, sustainable business practises require more than climate yardsticks to become competitive. There is still no comprehensive and, importantly, punitive emissions-based system of enforcement, which leaves industries with little option but to depend on the overlapping and toothless green guidelines already in play under the likes of Science Based Target initiatives, Competition and Markets Authority guidelines and, most recently, Chancellor Rishi Sunak’s Transition Plan Taskforce. In my interview with Mark Landler, the London Bureau Chief at the New York Times frankly described negotiations on a cohesive regulatory rulebook with bite as the “nuts and bolts of this COP”.

In basic terms, market forces dictate that a company is accountable to both its customers and its shareholders, the first of which expects affordability and the latter of which expects profitability. This poses a fundamental problem for decarbonisation intentions. Commenting on Scope 3 emissions, Tony Danker also said on Thursday that businesses will be “left behind unless they prepare for the supply chain pressure that’s coming.” Even net-zero goals set by business typically exclude these emissions-dense supply chains, and sustainable decision-making continues to carry daunting and uncompetitive up-front costs which tend to translate into higher price points for consumers.

As COP26 sweats across the finishing line this weekend, the continuing emphasis on voluntary corporate transitions is undermining the serious need for government policy interventions - it will make or break this summit for generations to come.

Shock of the Day

A new draft of the final summit agreement that could emerge from the summit appears to have watered down its call to curb fossil fuels.

(Source: The Guardian)

Stat of the Day

First major summit report finds that COP26 climate pledges will fail to dent the planet’s trajectory for 1.5 degrees of warming by 2030.

(Source: BBC News)