As the dust settles after the historic adoption of the Paris 2015 agreement, E3G and friends share a short blog series exploring what Paris means to different sectors, regions and constituencies.
The EU played a key role in making the unexpectedly strong Paris Agreement on climate change happen. It must now walk the talk, and deliver increased climate ambition through its own energy union.
With the ink barely dry on the Paris Agreement, the key implications for Europe are already becoming clear.
Leadership is an investment that pays off.
In Paris, Europe built new alliances to break down old divides. It helped form a new “high ambition coalition” that started as a partnership with the most climate vulnerable countries and ended up as an alliance including half of the world. The Paris outcome shows the impact European diplomacy can have when aligned around a clear strategy. The French Presidency of COP21 was also critical in creating the stage for political ambition to emerge by delivering a masterclass in classical and modern diplomacy.
But though the diplomacy was vital, the success of the Paris Agreement rested on fundamental changes in how countries saw their national interests over the past five years. Increasing frequency of climate impacts paired with plummeting clean energy prices made countries realise that there is more economic risk in failing to tackle climate change than in moving to a low-carbon economy.
This fundamental political shift was a consequence of long-running European climate leadership. The EU 2020 Climate and Energy package kick-started global markets in clean energy technologies through a mix of renewable targets, efficiency standards, carbon pricing and innovation policy. Delivering this through open markets stimulated global supply chains, which dramatically lowered the costs of clean energy. It also positioned EU companies as leaders across the fast-growing US$5 trillion global low-carbon economy – though this leadership is threatened as other countries like China enter this market. Europe needs to demonstrate that it can retain its leadership and design its energy markets and infrastructure around a zero carbon, renewable energy based system.
Europe is no longer acting alone on climate change.
The Paris Agreement is a legally binding framework for all countries to progressively cut greenhouse gas emissions. In the run-up to Paris, 188 countries registered climate commitments, which will cut global emissions by 11 gigatonnes. Backsliding from past pledges is explicitly outlawed. Eight of the world’s major economies plan to double renewable energy by 2030, a faster expansion than planned in Europe. The boom in global clean energy deployment triggered by the Paris Agreement will lower technology costs even further and create a major market opportunity for forward-looking European firms.
And it’s not just governments who are taking action. Paris saw an extraordinary set of commitments on climate change from regions, businesses, cities, financial institutions and many, many others. The RE100 group of major companies (ranging from Google to Goldman Sachs, and Microsoft to Coca Cola) committed to source their electricity from 100 per cent renewable sources. Nearly 1,000 mayors from five continents pledged to deliver a transition to 100 per cent renewable energy in their communities or an 80 per cent reduction in greenhouse gases by 2050. 400 investors representing over US$24trillion signed the Global Investor Statement on Climate Change to increase low-carbon and climate resilient investments. In Europe, 16 leading companies from across the built environment committed to nearly zero energy buildings for new build by 2020 and for refurbished buildings by 2030.
Businesses and cities have demonstrated that they are ready to lead on climate change. The clear outcomes achieved in Paris will give them confidence to invest and the knowledge that their additional actions will actually impact the global risk of climate change. The task at hand will now be to understand the real impact these commitments will have on the European market. Proper monitoring, verification and reporting will be essential to ensure accountability and implementation on the ground.
The direction of travel is clear and incontrovertible.
The Paris Agreement strengthened the global goal – first championed by the EU – to keep global temperature increase well below 2˚C and to pursue efforts to limit it to 1.5˚C. It added a more specific target to achieve global peaking of greenhouse gas emissions as soon as possible, and to reach greenhouse gas emission neutrality in the second half of the century. This goes further and faster than anything previously agreed, and signals that unabated combustion of fossil fuels must end by 2060 at the latest. The EU must review its own long-term climate goal to bring it in line with the new agreement, and then put it into practice. All new energy infrastructure built in Europe must be in line with this rapid transition out of fossil fuels. Steps must be taken to move away from the most polluting sources (e.g. coal) even more quickly.
EU must increase its own ambition.
Finally, Europe needs to ratchet up ambition at home in order to catalyse greater ambition internationally. The Paris commitments need to be doubled to keep us below 2˚C. The heart of the Paris Agreement is the ambition mechanism by which progress towards meeting the 2˚C limit is reviewed every 5 years. This creates a global “political moment” where countries can be encouraged – and pressured – to do more. As the key advocate of this mechanism, the EU must ensure this dynamic logic is reflected in its own legislative framework implementing its 2030 targets.
The first global review of ambition is scheduled for 2018. Greenhouse gas emissions in Europe fell by 24% from 1990 to 2014 and by some estimates will fall by 30% by 2020. A 40% target for 2030 – representing a 1% decrease per year in the 2020s – looks weak in this new international context, and analysts agree it is far from the most cost-effective path for the European economy. President Hollande has already committed to increase France’s GHG reduction target before 2020. To enable its businesses to thrive and lead in the low-carbon economy, the rest of the EU must now follow.
Nick Mabey is CEO of E3G, a think tank working to accelerate the transition to a low-carbon economy.
Sandrine Dixson-Declève is Director of The Prince of Wales’s Corporate Leaders Group (CLG), which brings together 23 global business leaders working to advocate solutions on climate change. CLG members employ 2 million people in 170 countries, with combined revenues of $170 billion.
This blog first appeared in Euractiv