Current emission reduction targets fall drastically short of Paris 2C goals
Under the Paris accord, close to 200 countries have pledged to keep global warming to “well below” 2C, and strive for a ceiling of 1.5C. To stay below the 2C scenario, global carbon emissions need to be reduced to 75% of 2010-levels by 2030 and to 0% by 2070. However, current nationally determined contribution (NDC) targets account for only a meagre 0.5% reduction in emissions by 2030. According to a recent report from the United Nations that collated the emissions reduction targets submitted by 75 of the Parties, the current plan for emissions reduction falls drastically short of the pledged target.
More ambitious targets are required
The latest national targets compiled in this report already represent a small improvement over previously published targets. While 75 parties: Andorra, Argentina, Australia, Bangladesh, Brazil, Brunei Darussalam, Cambodia, Chile, Colombia, Costa Rica, Cuba, Democratic People’s Republic of Korea, Dominican Republic, Ecuador, Ethiopia, European Union and its 27 member States, Fiji, Grenada, Jamaica, Japan, Kenya, Maldives, Marshall Islands, Mexico, Monaco, Mongolia, Nepal, New Zealand, Nicaragua, Norway, Panama, Papua New Guinea, Peru, Republic of Korea, Republic of Moldova, Russian Federation, Rwanda, Senegal, Singapore, Suriname, Switzerland, Thailand, Tonga, United Arab Emirates, United Kingdom of Great Britain and Northern Ireland, Uruguay, Viet Nam and Zambia, responsible for 30% of the global emissions, have submitted their reduction plans, the plans of major emitters such as China, US, India, are still awaited.
Current pledges under the Paris accord require deep cuts in carbon emissions. However, the current plans, though an improvement over previous plans, barely make a dent in reducing global emissions.
(Courtesy: United Nations Framework Convention on Climate Change (adapted))
UN Secretary-General António Guterres has urged the governments to set more ambitious targets for carbon emissions reduction: “Today’s interim report from the UNFCCC is a red alert for our planet. It shows governments are nowhere close to the level of ambition needed to limit climate change to 1.5 degrees and meet the goals of the Paris Agreement. The major emitters must step up with much more ambitious emissions reductions targets for 2030.”
Dev Majumder, co-founder of ESG Base said, “Over this past year we have seen growing political will toward climate action around the world, but the momentum toward decarbonization clearly has to accelerate significantly if we are to meet the goals of the Paris accord. The technology trends and policy outlook are favourable, but the governments still have an important role to implement market mechanisms that reduce the downside risks for investors funding green infrastructures.”
The decade of action
Although most major carbon emitting nations have made efforts toward decarbonizing their power sector, the more complex problems still lie ahead when governments try to decarbonize across all sectors of the economy. Apart from power generation, economic activities such as heat generation, transportation, agriculture, deforestation and land use change, industrial processes, etc. are major contributors of carbon emissions to the atmosphere, and major changes to infrastructures are needed to make these activities carbon-neutral and sustainable. According to an estimate from OECD/World Bank, about $7 trillion investments are needed per year on infrastructures over the next decade to transition to a more environmentally aligned economy.
Real-asset investors will have a major role to play in ensuring that future investments are both environmentally responsible and financially attractive. Investors intending to take the lead in sustainable investments can now benefit from ESG Base’s specialised capabilities to make more informed and vetted investment decisions.
About ESG Base
ESG Base is a London-based, global premium provider of technology and data solutions enabling ESG investments in real assets.
ESG Base Ltd.’s mission is to offer scalable technology solutions for fund managers and investors to identify the best ESG aligned investments and to enable performance monitoring of the assets through the investment lifecycle. Their SaaS technology powered by AI and advanced automation draws from a wide range of data sources and provides projections on future performance of investments subject to dynamic policy and technology scenarios.
ESG Base is supported by the Institute of Innovation and Entrepreneurship at London Business School and by Santander UK Universities.