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Leaders Summit on Climate prompts new climate targets and financing

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  1. US and Japan commit to near-term action with new climate targets, putting themselves on a credible pathway to climate neutrality by 2050. The majority of G7 countries are increasing ambition, but still have a long way to go to halve emissions by 2030. 
  2. With South Korea committing to end international coal finance, Japan and China remain the only two major coal funders. Meanwhile the US announced a goal to end public finance to ‘carbon intensive’ fossil fuel projects abroad.  
  3. While climate finance pledges largely underwhelmed, the Summit confirmed that finance is not only a diplomatic issue within climate negotiations but also a system change challenge for the international community. 

Story 

Today’s US Leaders Summit on Climate marks the first major test for global climate ambition in 2021The summit aimed to get the world’s major economies to keep the Paris Agreement goal of limiting warming to 1.5 degrees Celsius within reach. 

New US and Japanese climate targets of 50% were announced – setting a clear standard for developed countries. Canada’s new target fell short of expectations. Now pressure will escalate ahead of June’s UK-hosted G7 meeting, to deliver policies that work to achieve climate safety. This in turn should raise pressure on other G20 countries to follow suit or be left behind. 

South Korea announced it is ending international coal finance, escalating pressure on China and Japan to follow suit this year. China announced it would start reducing its domestic coal fleet in mid-2020, strictly controlling its use until then. 

The US released its International Climate Finance Plan, which featured climate finance, private finance mobilisation and an aim to end public finance for fossil energy abroadWhile the pledge is double Obama-era efforts, it falls short of global leadership on financing sustainable global recovery. It also encourages further effort to align multilateral banks with the Paris Agreement, but fails to outline steps for them to fully realise a sustainable recovery. 

Quotes 

On the summit, Nick Mabey, Chief Executive of E3G said: 

We welcome US President Biden raising the bar for global climate ambition. He now needs to build rocksolid transatlantic alliances to secure a successful COP26 – the true test of whether we have done enough this year to achieve climate safety for all.  

 

While the Summit is off to a strong start, it is but one moment in this crucial year for climate. We must now shift our focus to the rest of 2021, starting with the UK-led G7 in June. Here we need to see a shift away from fossil fuels towards a truly green recovery that provides financial firepower to the most vulnerable economies. 

On the US NDC, Claire Healy, Director of Washington DC office at E3G said: 

The US is back with a new target that puts us on a solid path towards halving global emissions by 2030. It’s only taken 51 Earth Days for world leaders to say on record that keeping global warming within safe limits is in their national interest. The race to future netzero economies is on! 

 

Now the US must work concretely with the UK and Europe to put an end to coal, green domestic COVID-19 recovery packages, and mobilise finance to help other countries recover while cutting emissions. Big decisions ahead. Tough decisions to turn this rhetoric into real emission cuts. For today it’s good to have the US back in action. It sure beats the alternative. 

On China’s announcement, Byford Tsang, Senior Policy Advisor said:  

China’s announcement is a step forward, but greater domestic action is needed to bring emissions reductions forward. This includes rising to UN Secretary General Guterres’ challenge for a coal-free world by 2040. The national emissions peaking plan due out later this year must include concrete measures to stop investment in new coal as soon as possible.  

Jennifer Tollmann, Senior Policy Advisor at E3G said: 

European leaders rightfully spotlighted the good story they have to tell of the continent’s transition to a fossil free economy. Leadership in transforming their financial system to match was a clear red thread – through green bonds and front-runner public banksWith US Treasury Secretary Yellen highlighting US movement on similar fronts, this is a clear area for transatlantic cooperation. 

 

How European leaders, and the broader G7, will support others to follow a similar green transition remained less clear. Faced with urgent calls for support by representatives of climate vulnerable nations, Italian Prime Ministers Draghi and French President Macron did point to two stepping stones on the path to unlocking greener and more resilient recovery abroad: the French-Africa summit and efforts underway under the Italian G20 presidency to leverage greater climate support from multilateral development banks. 

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