Tuesday, January 31, 2023

COP26: Who Pays?

More than 100,000 climate change activists from around the world gathered in Glasgow on Saturday to protest the agreements and promises made so far in the COP26 climate talks. Protesters said the new pledges made during the summit – to cut carbon and methane emissions, end deforestation, phase out coal and provide more funding for poorer countries most vulnerable to extreme weather far from meeting the requirements. necessary to contain global warming. Teenage activist Greta Thunberg described the two-week summit as “blah blah blah” and called it a “failure.” She told rowdy young protesters outside the conference venue that the conference had evolved into a “global North Greenwash Festival.” Others, however, are concerned that in a rush to commit to climate change, Western governments may act too quickly with decarbonisation and risk losing the support of their own populations by failing to take into account the economic implications of the alleged monumental shifts. Opinion polls show that the vast majority of people around the world view climate change as an emergency requiring decisive action. But some polls in recent weeks have also shown that when people are told what the cost of helping them fight global warming might be, they don’t want to shoulder the financial burden. A UK poll released Sunday showed that less than half of the British population is willing to pay thousands of pounds to make their homes greener to help meet the zero-emission targets set by Prime Minister Boris Johnson. Interviewees were asked their views on green policies to reduce emissions before and after hearing about the estimated upfront costs of insulating their homes and switching from gas boilers for heating to heat pumps. In a survey conducted by JL Partners for the UK think tank Onward, 50% supported the idea of ​​improving home insulation, double glazing and switching to heat pumps. But when they were given an estimated cost of $ 11,000 per family, support ended and only 26% agreed. “The millions of voters who broadly support the clean land agenda are wondering how much of the burden of moving to a low-carbon, low-emission economy will fall on them as they struggle to make ends meet,” wrote on Monday The Telegraph economist and newspaper columnist Liam Halligan. How to green the planet and finance the transition from dependence on fossil fuels to renewable and sustainable energy sources, as well as how to finance projects to make countries more resilient to extreme weather conditions, were key topics of the summit. It also discussed costs and how they are allocated to government (through taxation), consumers, households and the private sector. Last week, major banks, investors and insurers pledged trillions of dollars in green finance in a coordinated effort to integrate carbon into their investment and lending decisions. The UN Glasgow Financial Alliance for Net Zero, made up of more than 450 financial institutions in 45 countries and $ 130 trillion in asset managers, is committed to its program to cut carbon emissions and fund the investments needed for greener new technologies. Unveiled last week by UN Climate Envoy Mark Carney, funding can take the form of bank loans and investments by venture capitalists, private equity firms, mutual funds, trust funds and other large investors who buy stocks and bonds. They will continue to profit from investing in investments that help reduce their carbon footprint. “These seemingly incomprehensible, but significant changes in the financial system can move from the place of climate change to the fore and transform the financial system in the process,” said Carney, the former governor of the central banks of England and Canada. “The architecture of the global financial system has been transformed to achieve zero net income,” Carney said. US Treasury Secretary Janet Yellen said in Glasgow following the funding announcement “the gap between what governments have and what the world needs” to fund the global energy transition and achieve the goal of zero emissions by 2050. measures. “And the private sector needs to play a more important role.” Climate activists have denounced this promise, saying it is just another big promise that will not be fulfilled. “World leaders can no longer trust financial institutions to regulate themselves,” said Veronica Oakeshott of Global Witness, an international nongovernmental organization. Some industry analysts and economists say the private sector plans are far from specific and serious challenges remain with how to measure the carbon footprint of investment portfolios and reconcile those measurements in international financial markets. Who will check the accuracy of the reports of banks and investors? Others are concerned that financial firms exist to maximize returns for clients and shareholders, and risk losing clients or violating their fiduciary obligations if they fail to maintain good returns. At this stage, it remains unclear how profitable green investments will be. There are also fears that in the fossil fuel sector, lenders and investors will continue to divest their assets in an effort to reduce their carbon footprint, leading to higher electricity costs for consumers as global demand for natural gas and oil continues to rise. Fossil fuel investment is no longer sufficient to meet future energy needs. This, in turn, has contributed to the current global energy crisis and record high energy prices for households and businesses, industry observers say. …

Nation World News Desk
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