Gold in Glasgow’s COP26
The biggest-ever gravy train left Glasgow Central railway station on November 12 at the end of COP 26, carrying $130 trillion worth of promises from the world of business and a further $100 billion in government pledges. Predictably the developing world cried that this is not enough and each impoverished sector put its hand up for a share. No matter how committed you are to climate change, these figures represent huge opportunities for businesses.
All that glitters may not be green
Not all is quite as it seems, according to Ed Conway, Sky News’s financial editor, who explains here that the 450 financial organisations control between them $130tn and have agreed to back “clean” technology, such as renewable energy, and direct finance away from fossil fuel-burning industries. Not quite the hand-out the headlines projected and no actual figures or deadlines.
John Denton, secretary general of the International Chambers of Commerce, would not approve. Asked about the governments’ promise of $100 billion on the last day of COP26, he said that there had been real commitment from many governments, including his own in Australia, where the premier Scott Morrison – described unforgettably as “Scotty from Marketing” by an Australian journalist during the greenfest – announced a plan … whose overall investment totals $20 bn. The man who once brought a lump of coal to Parliament and promised to defend the Hunter Valley coal mines was put straight by Australia’s Minister for Resources, Keith Pitt “We have said very clearly we are not closing coal mines and we are not closing coal-fired power stations.”
Measure what you manage
Denton’s points were that government pledges were short on detail and such expenditure needs accountability and clear outcomes. BBC World Service’s Bola Mosuro did not agree and wanted to know what business would be doing to help the developing world.
An initiative that might meet these criteria is the Microsoft founder and philanthropist Bill Gates and the European Union joint investment deal that aims to provide up to half the finance needed to create affordable green technologies for Europe, which will also benefit the world. Gates’s foundation at least has a reputation for timelines and accountability. Announced in Glasgow on November 2, the deal aims to mobilize up to $1 billion between 2022 and 2026 in financing projects in the hydrogen, aviation, energy storage and air capture industries. Each euro of public funds is expected to leverage three euros of private funds, according to the EU Commission. Which column does this billion go in?
Those big numbers bandied in Glasgow may prove as evanescent as the rhetoric of Barack Obama and Greta Thunberg, Martin Vander Weyer said in The Spectator last week But China and India apart, the movement is very largely in one direction and the private sector is leading it. You’ll be surprised to hear me say this, but if anyone can save the world, it’s most likely the bankers.
What’s a trillion here or there?
We’re told that more than 450 banks and investment firms representing $130 trillion of assets (that’s 40 per cent of global savings, give or take a few soaring bitcoins) have joined the Glasgow Financial Alliance for Net Zero led by Mark Carney and Michael Bloomberg, who tell us that ramping up clean energy fast enough to avoid the worst impacts of climate change will require new investment, mostly from the private sector, ‘likely in the ballpark of $100 trillion’.
So the $130 trillion already committed is bigger than the $100 trillion needed? And the City of London, rebranded by Rishi Sunak as ‘the world’s first net-zero financial centre’, is honing its celebrated innovation skills to lead us all to safety? Phew, that’s a relief — or perhaps not quite.
Cynics have pointed out that fossil-fuel industry delegates outnumbered any other mission to COP26 and that signatories to the groups which make up Carney’s alliance, having provided $4 trillion of funding for coal, oil and gas projects since 2015, are not barred from providing more.
Whether you are exporting coal-fired generators at $1 bn a pop to Zimbabwe—whose president chartered a jet from a company social media says he owns to take him to Glasgow. He has rejected millions of dollars in carbon credits from the EU because he refuses to allow the Save Conservancy to remain a wildife area – or plan to set up knitting bees to produce socks to keep gas-deprived British toes warm this winter, opportunities are there for the taking.
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