COP21 from the eyes of our CEO Les McCabe- Day 3
There is broad consensus here in Paris that climate action is essential not only to protect the planet, its people and biodiversity, but also to insure transformative, sustainable development throughout the world, taking into account social justice while simultaneously protecting ecosystems vital to our health and well being.
The leaders from government, international organizations, the private sector and civil society convened at COP21 all recognize the importance of working with a collaborative approach to solving the issues of climate change. Nevertheless, at the end of the day, such collaboration becomes a moot point if our national governments cannot agree on comprehensive and equitable carbon reduction policy.
A major discussion point today is focused on the idea of a carbon tax known as a Cap and Trade process, which would set limits on each country’s carbon emissions or require carbon trading. Currently, only 40 countries are engaged in such a practice and it will take all 190 countries here at COP21 to agree on carbon reductions to make any significant difference in climate change.
Unfortunately, as Ian Parry, the Principal Environmental Fiscal Policy Expert from the International Monetary Fund notes, the Cap and Trade debate has become mired in the concern that it will undermine economic growth, particularly in developing countries. The recent vote by the US congress against setting carbon emissions limits certainly doesn't inspire other countries to do the same. The US, along with other developed countries, contributes 60% of global carbon emissions, and so must take the lead in this important idea.
Ironically at this COP21, compared to prior climate summits, there is a much higher number of less-developed countries prepared to make changes. Given these dynamics, the mood here does not lead to a feeling that an agreement will be reached by the various countries per se, as much as a pledge. While such pledges send an important message on capping carbon emission in the absence of actual agreements, there is little doubt that we will exceed the two-degree Celsius ceiling necessary to prevent further climate change. As such, a considerable amount of focus here in Paris has been on climate adaptation and strengthening resilience through a process of examining human and economic risks.
The consensus that climate impact is inevitable for the immediate future is creating a focus of efforts that, while not abandoning mitigation, more so accepts the grim reality that many countries will have to face it in the short-term.
This afternoon's session entitled Leadership on Climate Change Adaptation: Innovation for Stronger Resilience highlighted some of the global economic risks of climate change. Mike Wilkins, Managing Director of the Standard & Poor’s rating service, painted a picture using S&P data and analytics that show the significant impact that climate change will have on countries of risk, particularly in the Caribbean, Latin America, and Asia.
High-risk areas will continue to see their credit risk increase, which will substantially reduce their ability to borrow for economic development due to a debt risk caused by climate change.
This leaves many countries with just two choices regarding transfer of risk, either insurance or adaption. Unfortunately, with increased climate change risk, these same countries will see a 30% to 70% increase in insurance costs, which for many is untenable. This makes for a strong argument for investment in resilience, which over time in the face of climate change pays for itself.
An example of the investment in mitigation and adaptation made by a country like The Netherlands versus the investment by Asian countries like Thailand or Vietnam provides a stark contrast to the disparity between nations to withstand any inevitable future major climate change events.
From my perspective, it is important not to err on the side of focusing on adaptation and resilience to the exclusion of climate change mitigation. The fact is these are not either / or scenarios.
Both must be considered, but with the realistic understanding that even with the best efforts at mitigation that can emerge from a summit like this, there will continue to occur major climate change events in the coming years that will require many countries to take steps in adaptation and resilience similar to what Global Green USA has done with our construction projects in New Orleans and Solar for Sandy in the Northeast that take an adaptive approach by providing off grid solar power at community centers so to offer a place for people to go in a future climate catastrophe with access to power.
Finally, I couldn't agree more with panelist Jean-Marie Chataignier in the importance of a multi-dimensional approach to combating this challenge by focusing on education regarding climate change; encouraging partnerships between NGOs, governments, research, and the business community; and innovation and investment in processes to help decarbonate our planet.
If there is one major theme that runs throughout this summit, it is the recognition that it will take a collaborative effort between each party to affect real change and create adaptive and resilient solutions. Any and all government pledges will be a major step in recognition of the problem, but I suspect it will require more COPs over the next few years to reach a point where the politics of any individual country is superseded by the well-being of global humanity.