In the Week Ahead: Saying Goodbye to a Queen and Saving a Planet
“The Time for Words Has Now Moved to the Time for Action”
Queen Elizabeth II
The Queen understood the enormity of the climate threat. Perhaps it was the perspective gained sitting on the throne for the better part of a century that allowed her to see the arc of history and the shape of the future. She opened COP 26 in Glasgow with this video address, in which she recognized the difficulty of the task ahead, and the opportunity that we have at this moment to address the challenge. “It is the hope of many that the legacy of this summit – written in history books yet to be printed – will describe you as the leaders who did not pass up the opportunity.”
The critical point is that the opportunity to address climate change is now. We still have the ability to avert the worst effects of the changing climate but the window of opportunity won’t be open for long. The policy and economic preconditions for success exist. The net zero commitments made by countries, companies, and financial institutions at COP 26 reflect the will and capacity for success. Financial institutions controlling $130 trillion in capital have committed to net zero financed emissions through the Glasgow Financial Alliance for Net Zero (GFANZ). The Inflation Reduction Act’s climate provisions provide a pathway to radically decarbonize our economy. It has become clear that companies will be compelled by regulators and shareholders to report on their carbon emissions and their climate strategies. Now the focus needs to be on how to accelerate our decarbonization pathways.
The World Economic Forum’s 2022 Global Risks Report highlighted the urgency, ranking “climate action failure” as the most pronounced long-term threat to the world. We need to act now or we will lose the ability to act. “Accelerating and widespread climate change manifests itself in irreversible consequences. The overwhelming weight of scientific analysis points to environmental adjustments and cataclysmic feedback loops that will push ecosystems beyond tipping points.” There is a compounding feedback loop - our ability to address climate change will be increasingly compromised as our resources go to addressing more severe climate impacts. When faced with famine, disease, wildfires, natural disasters, displacement of people, and other severe climate impacts, resources will be funneled to those needs and transition will be more difficult.
There is good news. We have a collective will to act. Capital has been committed to decarbonization, and there is regulatory support. It is not too late. We still have the ability to act to transition to a lower emissions world. The imperative is to focus our efforts on transition planning and technological innovation without delay.
Opening COP 26, Queen Elizabeth set the stage for the week: “In the coming days, the world has the chance to join in the shared objective of creating a safer, more stable future for our people and for the planet on which we depend.” Let’s honor the Queen and carry her wish into Climate Week.
Australia Binds Targets by Law as Pacific Islanders Warn of Disaster
Former Pacific Island presidents Anote Tong of Kiribati and Tommy Remengesau Jr of Palau are urging Australian leaders to get serious about addressing the climate crisis. As Australia bids to host the UN climate conference, COP 29, they are lacking meaningful action to back their expressed sentiments towards climate change. Tong and Remengesau Jr specifically call on them to implement more significant cuts to GHG emissions and a pause on new coal and gas projects, stressing that time is of the essence as at this rate, Tong’s own home country of Kiribati and others will likely be uninhabitable come 2060.
At the same time, Australia has enshrined its climate targets into law. Climate Change Bill 2022 was passed this past week, including targets for the country to reduce GHG emissions 43% by 2030, with a net zero target by 2050. To hold the government accountable, the law requires an annual climate change statement to provide an update on the country’s progress towards the goals.
Quebec Fails to Keep up on Emission Reduction Targets
While climate seems to be one of the top concerns among Quebec voters, it seems that the province can talk the talk, but fails to walk the walk. So far, they have strayed off track of their 2030 emission reduction targets, with the biggest source of GHG emissions coming from transportation. Responses from government officials range from setting no targets at all; to adjusting targets to be less ambitious; to driving citizens to reduce transportation emissions by incentivizing greener options, forcing consumers away from fossil-fuel modes via taxes and regulation, or some combination of both. The bottom line is that unless officials take significant action, those targets will remain out of reach. The time to act is now.
Dutch Regulators Investigate H&M, Spurring Recall on Sustainability Labels
Dutch retailers H&M and Decathlon have agreed to remove sustainability labels from their products and websites after a greenwashing investigation by the Dutch Authority for Consumers and Markets (ACM). The companies have also agreed to pay donations of €400,000 and €500,000 to environmental causes to make up for their greenwashing practices. The two retailers were found to be engaging in branding practices that exaggerated the eco-friendly nature of their products. H&M, for instance, has been using sustainability-related claims like “Conscious Choice” in its marketing without actually substantiating the sustainability of its products.
EU Parliament Moves Forward Proposal to Combat Deforestation
The European Parliament recently voted to regulate domestic goods, prohibiting producers from sourcing materials from deforested or degraded land, and requiring them to follow human rights provisions for production. Leaders are hoping to right some wrongs, as the EU is responsible for roughly 10% of the global deforestation that took place between 1990 and 2020.
Russian Activist Groups Demand More Climate Action from Government
A climate lawsuit filed by a collection of activist groups demands that the Russian government take stronger measures to fight climate change. The group wants the Russian government to introduce policies in line with a 1.5C degree warming scenario, which would require Russia to reduce emissions to 31% of 1990 goals by 2030, or 968 metric tons of CO2. Russia is the 4th-largest producer of carbon emissions in the world, but current government emissions targets don’t bring the country remotely close to achieving Paris climate goals: the country is currently on track for 2,212 metric tons of CO2 emissions by 2030.
Singapore Launches ESG Disclosure Platform
Singapore launched a digital ESG disclosure portal for company and investor use this week. ESGenome, a portal created by the Monetary Authority of Singapore and the Singapore Exchange, will allow companies to input data across 3,000 ESG metrics based on global reporting standards like that of the TCFD and GRI. Investors, who are increasingly looking at climate-related metrics when making investment decisions, will be able to view this climate-related data and perform benchmarking and company tracking based on the information. The portal is now live for access for listed companies in Singapore.
UK Regulators Investigate Fashion Retailers over Greenwashing
Following a similar thread as its Dutch counterpart, the UK Competition and Markets Authority has launched an investigation into British fashion retailers ASOS, Boohoo, and George at Asda over allegations of greenwashing. The CMA will be focusing on whether the language used in these brands’ new collections creates the impression that the retailers’ products are more environmentally sustainable than they actually are. Interim CMA Chief Sarah Cardell said that the probe reflects an increased focus at the agency on the fashion industry. “This is just the start of our work in this sector and all fashion companies should take note: look at your own practices and make sure they are in line with the law.”
Implementing the IRA
In the aftermath of the passage and celebration of the Inflation Reduction Act, federal agencies are beginning their path to implementation. E&E News reports that the Department of Energy, Interior Department, and the Federal Energy Regulatory Commission are exploring how to carry out the climate provisions of the law, as the law’s expansive reach will undoubtedly require significant collaboration among agencies.
Before the IRA’s funds reach their intended projects, departments like the DOE will have to write regulations and guidelines to implement these new programs and how the funds will be allocated. DOE guidelines for the IRA’s programs are yet to be released, and are likely to provide further direction with regard to implementation.
In the meantime, the White House has launched a climate bill website for consumers. Cleanenergy.gov is a guide for those interested in taking advantage of the tax credits allotted under the IRA, providing ways for Americans to save money using solar panels, electric vehicles, and more energy efficient options in their households. The site is interactive and allows people with various income levels, occupations, and homeowner statuses to see how tax credits will impact them.
California Climate Update
In August, Governor Gavin Newsom proposed a number of ambitious climate proposals. Some have been adopted and some have fallen short. SB 260, the highly-followed proposal to require companies with over $1 billion in revenue to measure and report their Scope 1, 2, and (if material) 3 emissions, failed to gain a majority of votes.
- Codifying statewide carbon neutrality goal to dramatically reduce climate pollution. This proposal establishes a legally binding carbon neutrality goal no later than 2045.
- Protecting communities from the harmful impacts of the oil industry. This proposal establishes a setback distance of 3,200 feet between an new oil project and homes, schools or parks. For any existing oil well within that distance, there will be ‘comprehensive pollution controls.’
- Establishing a pathway toward the state's clean energy future. In passing this proposal, the state has set a target of 90% of all retail sales of electricity to be from renewable and zero-carbon sources by 2035 and 95% by 2040.
- Advancing natural and engineered technologies to remove carbon pollution. With the passage of this bill, California gains a regulatory framework for carbon removal and carbon capture, utilization and sequestration.
- Ramping up climate ambitions to reach a 55% GHG reduction by 2030. The aim of AB 2133 is to advance the state’s current emissions reduction target from 40% to 55% below 1990 levels by 2030. The bill was not adopted by the legislature, making it the only bill of the five to not be adopted into law.
- Requiring corporate sustainability disclosure. Although 37 voted for the proposal compared to the 25 against, the proposal failed due to the 18 abstainers that prevented SB 260 from gaining the majority necessary for adoption. If passed, the bill would have expanded GHG emissions reporting in the state.
New York Invests in Climate Technology Solutions
New York Governor Kathy Hochul announced a $6.5 million investment in supporting grants that will manage the financial risks associated with climate change. The program focuses, among other things, on the development of new insurance policies, products and services that promote renewable energy across the state. The New York State Energy Research & Development Authority (NYSERDA) will administer the program, working with insurance companies by granting funds, and coordinating on the research and development needed to accelerate bringing climate technology solutions to the market.
Images for this newsletter were provided by
DJ Paine, Unsplash
Dave Herring, Unsplash
Drew Angerer, Getty Images