As nearly 200 nations gather for COP26 in Glasgow to review the goals set out in the Paris Agreement and seek to deliver 'Global Net Zero', it begs the biggest question facing the world - are we on the right course?
To answer, the commitments of the 4 biggest emitters, who collectively account for 60%+ of global emissions, becomes central. These are due to be enhanced at COP 26.
However, climate commitments have innate risks due to the uncertainties associated with the credibility and durability of those commitments. National commitments need to be backed up with policy and legislative action to ensure they are credible. Equally, the breadth and depth of domestic political support determines the durability of those commitments in light of economic and political shocks which could weaken support in the future.
At COP26 Baringa would want to see not just an upgrade in rhetorical national commitments, in the form of National Determined Contributions, but substantial policy development at home to offer credibility to these national targets. For example, greater clarity on how a step change in renewable deployment in the US will be achieved. With much of Biden’s legislative agenda mired in political battles in the Senate, a political breakthrough is needed at home to substantiate the US’s NDCs in Glasgow.
Equally greater clarity on how China will pursue the phase-out of coal is needed to give credence to national emission targets to peak emissions by 2030. Similarly, a commitment to reform China’s power generation market, to support market dispatch, is needed to support the increasing deployment of intermittent renewables.
Baringa’s Credibility & Durability assessments evaluate national commitments in light of these risks and uncertainties to highlight the relative confidence intervals surrounding national transition pathways, seeking to answer the question, are we on the right course?
Follow Baringa Partners on LinkedIn for more updates and thoughts on the run up to the COP26 conference and our obseravations and take-aways during the event itself.
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