In today’s Exponential Investor

  • Below 2! We made it below 2!
  • Judging India’s 2070 net zero commitment
  • Classic COP criticisms don’t quite add up

So much is happening that it’s almost impossible to keep up with it all.

But on my Twitter account, I am doing my best to filter and share all the key developments and best bits from the conference, so for a real-time and full-coverage picture, try me on there.

I’m going to get through as much as I can today though, as I’m sadly off next week. I will be trying to keep up with things on Twitter there though.

On Tuesday, I warned that the requirement for unanimity risked either the success or the extent of the commitment between nations at COP26 in Glasgow.

But we are already seeing the value of the event in so many other ways.

The headline news is that through new NDCs (nationally determined contributions) made by India (net zero by 2070) and other nations, the current NDCs together mean that we are projected to keep temperatures under a 2-degree rise, for the first time ever.

You can see the chart here, which gets bonus points for its old-school meme format.

It’s amazing! At Paris they committed to keeping global temperature rises below 2 degrees. We are aiming for 1.5 and that currently seems unlikely given various trajectories, but as Greta Thunberg so rightly pointed out, missing out on 1.5 doesn’t mean we should give up.

As she put it, “it’s never too late to do everything we can.”

Here are the other headlines:

  • Huge commitment to reduce and end deforestation in the coming decade, signed by nations which have 85% of the world’s forest land
  • Global Methane Pledge – to cut methane emissions 30% by 2030
  • Financing agreement between developed and developing nations, helping South Africa get off fossil fuels – an excellent new structure…
  • UK’s net finance commitment, all firms to publish strategies for net zero by 2023
  • India net zero 2070, and 450 GW of renewables by 2030.

As a result, net zero commitments now cover:

  • 84% of global CO2 output
  • 93% of coal use
  • 80% of oil
  • 65% of population
  • 75% of gas.

It’s all great stuff.

Reading between these headlines, here’s some interesting things that help give context and meaning to the one-line hot takes.

Nature based solutions take centre stage

Deforestation peaked, globally, in the 1980s. You can see the data here.

I will admit to being surprised by this. I didn’t know. My assumption based on mainstream media coverage was that this was a problem that was just getting worse and worse.

While it’s true that under President Jair Bolsonaro, Brazil’s Amazon rainforest has seen deforestation increase significantly, this is counter to the prevailing, multi-decade trend of slowing global deforestation.

In the northern, temperate forests, the story is actually one of reforestation.

Brazil’s inclusion in this new commitment is significant. I remain sceptical about how much change we will see on the ground under Bolsonaro’s rule, and how quickly, but there’s another point.

These aren’t just a few leaders making empty promises. Businesses and financiers are in on it too. The people are demanding change from their banks and their companies, and the call is being answered.

Deforestation in the supply chain of businesses is coming under ever greater scrutiny, and their commitments as part of this pact are significant, if they are followed through.

Trouble at the World Cup, but not on the world stage

India’s star cricketers may be having a disappointing time at their world event, but it’s a different story in Glasgow, as Prime Minister Narendra Modi finally released India’s net zero commitment: it will be by 2070.

This is subject to change of course, if technologies develop faster than people expect (and I am confident that they will).

Within that, though, are more specific commitments relating to its power sector. India has pledged to reach 450GW of renewable capacity by 2030, which is three times its current capacity.

This is more concrete and more immediate than the 2070 target. Given that carbon has a compounding effect on the climate, a carbon emission avoided in 2025 is more valuable than a carbon emission avoided in 2045 or 2065. India tripling renewables is a response to that urgency, and an indisputable signal of the direction of travel for power generation.

No longer can people say that renewables are a costly burden upon developing nations. They are not: they are their salvation.

This is especially relevant to air pollution in India, which is an amazingly large problem.

Again, from Twitter, “Air pollution kills over 1 million people a year annually in India. Under a net zero target, by 2040, the number of annual deaths due to air pollution would have halved.”

UK leads the way

So far, I have been impressed by Boris Johnson, I have to say.

I’m a centrist in many ways, and especially when it comes to the climate, I couldn’t care what colour you wear on polling day.

But I watched Boris’ press conference in full on Tuesday afternoon and was deeply impressed.

I was not struck so much by the statement – which, although good, is easily prepared by others – but by how he tackled the probing and pertinent questions put to him by journalists.

We are so used to seeing politicians shy away, obfuscate and dodge difficult questions with all their media training. But he showed a genuine understanding of the most important points, challenges and possible outcomes and delivered them impressively.

We know that five years ago the Conservatives, Boris included, had little interest in all that green nonsense. In particular, Alok Sharma’s voting record on energy matters is pretty poor, as Nafeez Ahmed has shown.

Finally, busting a classic criticism

This private jet thing. You’ve probably seen it. Essentially it entails pointing out that some of the world leaders attending COP got there on private jets, famously the worst environmental choice you can make. However, it’s kind of a meaningless point.

As Jacob Aaron tweeted, “So bored of “gotchas” over world leaders taking jets to COP26, or food suppliers not being sustainable, etc. These don’t illustrate hypocrisy, they show that we currently live in a society that is unsustainable in a way that is difficult to escape even if you want to.”

Or how about this excellent response from James Murray.

All in all though, things seem to be going okay.

I’m still not convinced that the need for unanimity in drafting the final document is for the best, but it’s everything around that that is really significant. In this context, side groups, smaller agreements, new commitments and focus on key strategic themes are what really matters.

So far, so good.

All the best for now, and see you in a couple of weeks.

Kit Winder
Co-Editor, Exponential Investor