Guest post by Jeremy Leggett, Non-executive chairman of Carbon Tracker
The global energy transition remains in a state of net forward momentum as of the end of November. However, evidence that the society is in danger of reaching its eventual target of complete or near-complete energy decarbonisation too late to save the planet from runaway global warming was particularly clear this month. As if we didn’t know it before the events of November, this is going to be a tight race.
The Paris Agreement, a global decarbonisation pact adopted by every independent nation on Earth, entered into force on November 4th. I summarised the state of play in international climate politics, as it stood after the Marrakech climate summit, in a blog on November 21st. In essence, every government but the Trump regime-in-waiting sees the Paris process as “irreversible”. In the Marrakech Declaration 195 of them essentially told the climate-denying President-elect that he will lead a rogue state in a minority of one on the climate issue if he walks away from the treaty.
360 US companies wrote to Trump adding that withdrawal from the Paris accord would put US prosperity at risk. Corporate front runners around the world this month performed consistently with such an analysis. In Europe, notably, Dong Energy profits soared in the third quarter as a result of successful offshore wind projects and the selling off of their gas grid. The company began life as Denmark’s national oil company. This month their CEO, Henrik Poulsen, announced Dong’s intention to divest all remaining oil and gas assets and focus just on renewables, mostly offshore wind. The company sees “strong investor demand”, Poulsen said.
One example of that was HSBC’s UK pension scheme investing £1.85bn in a fund recently established by the UK’s largest fund managers, LGIM, with no coal, reduced oil and gas exposure, and a focus on low carbon investments. Said LGIM’s head of sustainability, Meryam Omi: “This is a powerful message that we are sending to companies that they need to step up to meet the challenges of moving to a low carbon economy.” The chief investment officer at HSBC’s UK pension scheme, Mark Thompson, added that this would be “the new normal.”
Another mover in this general direction is the UK’s National Grid, which is disposing of its UK gas grid, recognising the rapid expansion of renewables, and making investments in batteries and smart meters accordingly. CEO John Pettigrew says that “2015 was the last year we operated the system in the way it has operated for the past 50”, with coal power plants being paid to meet peaks of demand. Now adjustments focus on paying companies to reduce demand. Soon, in a country where solar generation has exceeded coal for months at a time of late, batteries and smart meters will add to the capability to keep lights on and emissions down.
In America, Tesla shareholders voted through a $2.6bn merger deal with SolarCity, approving CEO Elon Musk’s vision by an Read the Original