COP26 member briefing

The UN Conference on Climate Change (COP26) closed last Saturday after two weeks and one extra day of negotiations. The resulting ‘Glasgow Climate Pact’ is a seven-page document that sets out the international actions that all 197 nations support.

The Glasgow Climate Pact covers key areas of mitigation and adaptation and reiterates the need for increased financial support from public and private sources for developing nations. Many of the statements in the pact are about the need to do more, and the direction of travel. COP26 was really about finding common ground that all parties could agree on, while keeping the ambition of limiting warming to 1.5 degrees C alive. As such, the agreement leaves room for differing levels of actions by different countries.

The overall conclusion is that while it was a difficult negotiation, progress has been made, and may be just enough to stay on the path to avoiding catastrophic global warming. Nonetheless, the urgency and fragility of the situation was underlined. There is recognition that COP26 was just a staging post, with COP27 in Egypt in 2022, and further events to drive action planned, including an annual political roundtable to assess progress, and a leaders summit in 2023.

Throughout the conference, progress was made on a number of issues, with governments and organisations separately signing up to sub-commitments and statements. The early heavy hitter was the commitment to end deforestation by 2030 (140 nations), which rightfully received significant press coverage. Other key outcomes included a commitment to end net zero car sales by 2040 (over 150 signatories), and the pledge to collectively reduce methane emissions by 30% by 2030 (110 participants). Encouragingly, 90% of nations have now made commitments for net zero, albeit on variable timescales. This is up from just 30% when the UK took on the COP presidency.

So, what does the agreement mean for CLA members?

There are three main areas within the Glasgow Climate Pact and associated commitments that may have an impact.

The UK has committed to a collective goal of reducing global methane emissions by at least 30 per cent from 2020 levels by 2030 and moving towards using the best available inventory methodologies to quantify methane emissions, with a particular focus on high emission sources.

The detail on how the UK government will target methane reduction is yet to come. Initially, the low-cost wins from countries signed up are anticipated to come from reducing leakage from the fossil fuel industry – leakage from the gas distribution system is one of the major sources of UK emissions, along with landfilling of wastes and agriculture. As this 30% reduction is a collective target with the other 110 signatories, we do not actually know what national contribution the UK will make, or how much of this is expected to come from decreases in emissions from the agricultural sector.

Emissions in agriculture are largely from ruminants as the result of enteric fermentation. As such, research and development into scaling up feed additives that can reduce methane from livestock will be key. Such feeds have shown promising reductions to date. Improved manure management systems and use of anaerobic digesters could also provide methane emission reductions.

Another key development at COP26 was a breakthrough on international carbon markets. The newly agreed ‘Article 6’ ensures that each tonne of CO2 or equivalent greenhouse gas can only be claimed once: either by the credit-generating country or by the second country buying that credit from the international market.

Each country has had to maintain a Nationally Determined Contribution (NDC) since the 2015 Paris Agreement. They outline the domestic measures countries will take to reduce emissions. NDCs are expected to get more progressive overtime and are submitted every five years to the UNFCCC secretariat. The lure of using international carbon markets to achieve NDCs is that for some countries, it may be cheaper to buy credits than take action to reduce domestic emissions, while for those generating more emission reductions than required under their NDCs, selling the credits provides additional finance (which can then be pumped back into emission-reducing projects).

Before the agreement at COP26, a carbon credit sold on an international market could have been counted twice – once towards the generating country’s NDC, and once towards the NDC of the purchasing country. Under Article 6, a carbon adjustment should be applied by the vendor country, to add the amount sold back onto their NDC. This avoidance of double counting should boost confidence in carbon markets and it is expected to incentivise private finance in developing countries.

As voluntary carbon markets develop internationally, it will be key to ensure that UK projects are also attractive to investors. This will require support from the UK government, and clearer guidance on how public and private finance can be blended to improve the viability of delivering nature-based sequestration.

The item which really hit the media as COP26 drew to a close was the change of wording in the final agreement from ‘phase out’ to ‘phase down’ coal. A smaller number of participants also signed the Global Coal to Clean Power Statement, with both Alok Sharma, on behalf of the UK, and Julie James, on behalf of Wales, supporting the statement.

Much of this is not really new news for the UK. Our transition to clean energy is well underway, and we already have a commitment to phase out coal power by 2024. The real impact for members will be uncovered as the detail of the UK’s low carbon energy system takes shape. Some of this has already been set out in the recently published Net Zero Strategy and Heat and Buildings Strategy, including a commitment to source all power from low carbon sources by 2035 but a solution which works for rural homes and businesses is yet to truly come through. A key issue is the relative weakness of our rural electricity grids and how greater renewable energy generation can be accommodated at the same time as power demand grows, as we transition to heat pumps and electric vehicles. Further light will hopefully be shed with the publication soon of a new Electricity Network Strategy. A new UK biomass strategy in 2022 will also be key because this will set out Government plans for biomass across the economy, particularly how they wish to encourage energy cropping and deployment of Bio-energy Carbon Capture and Storage (BECCS) technology.