Calls for greater fossil fuel divestment at anniversary of Paris climate deal
The Paris agreement on climate change, ratified by world governments a year ago, has failed to ensure major investors are moving away from fossil fuels with the urgency required to safeguard the planet, civil society groups have said.
Large companies, investors and national and local governments met in Paris on Tuesday to celebrate the second anniversary of the signing of the landmark 2015 agreement, which bound nearly all developed and developing countries for the first time to keep global temperatures below 2C, the threshold scientists regard as the limit of safety.
Emmanuel Macron, the president of France, arranged the One Planet conference to bring together governments, businesses and others to help find ways to meet the Paris goals. It followed a meeting of governments in Bonn, Germany, last month under the auspices of the UN, aimed at fleshing out the technicalities of the Paris agreement.
Donald Trump, president of the US, has vowed to withdraw his country from the agreement, but this action cannot take effect until November 2020, the day after that year’s US presidential election.
The Institutional Investors Group on Climate Change said its members and related groups, with more than $26tn under management in total, would work with companies to help them reduce emissions over the next five years, in accordance with the Paris goals. This would not include divesting from companies with large fossil fuel holdings, however.
Companies also made pledges: for instance, the French insurer Axa, the world’s third-largest insurance company, said it would divest €2.4bn in coal assets and €700m in tar sands assets, and put in place a new policy of not investing in companies with more than 30% of their power or revenues from coal, or planning to build more than 3,000MW of coal-fired electricity generation.
Local governments signed the One Planet charter, which requires cities and their mayors to use their public procurement and policy decisions to promote green technology, including renewable energy and zero-emissions buildings, as well as better arrangements for waste and recycling.
Nearly 200 civil society organisations, from nearly 60 countries, called on governments at the meeting to end subsidies and public finance for fossil fuels, and for the World Bank to end fossil fuel finance. The signatories included Greenpeace, the Climate Action Network, WWF, Christian Aid and Oil Change International.
A group of economists including Jeffrey Sachs and Yanis Varoufakis also called for no more to be spent on fossil fuels, while more than 50 companies including Adidas, Alliance, H&M and Philips signed another declaration calling for the polluting fuels to be phased out.
But green campaigners were concerned that the measures announced at the conference were insufficient to drive forward the Paris agreement goals.
Rachel Kennerley, of Friends of the Earth, said: “[The conference] should resolutely move cold hard cash away from dirty, polluting energy, and instead invest in clean energy, if we are to avoid the earth’s temperature rising by 3C[which scientists say is likely on current trends]. The [One Planet conference] will fail if it just delivers a rehash of previous commitments, because the scale of the challenge faced clearly cries out for a radical and immediate response.”
Alex Doukas, of Oil Change International, said companies were still investing in, and receiving government funding for, “exploration for more oil and gas that can never be burned if we have any hope of limiting the damage from climate change.”
Lord Stern, former chief economist of the World Bank, and author of the 2006 review of the economist of climate change that found tackling emissions would be much less costly than the effects of global warming, also called on Europe to take a lead. He said the current price on carbon under the European emissions trading scheme was too low, and called for a price of $40 to $80 a tonne of carbon dioxide by 2020 in order to reach the Paris agreement goals.
He said: “Fossil fuels must be confronted with their real costs, and polluters must pay, if markets are to work and emissions are to fall at the rate necessary. However, a carbon price by itself cannot deliver the required design of cities and networks that will be crucial to reducing emissions on the scale necessary. Carbon pricing must be supported by other policies to drive the low-carbon transition [including] regulation to drive out coal from our power systems quickly, and stopping the sale of new cars powered by fossil fuels over the next couple of decades.”