Emissions Gap Report 2021 shows that new national climate pledges combined with other mitigation measures put the world on track for a global temperature increase of 2.7°C by the end of the century. This is well above the goals of the Paris climate agreement and would lead to catastrophic changes in the Earth's climate. To keep global warming below 1.5 degrees Celsius this century, the Paris Agreement's aspirational goal, the world needs to halve annual greenhouse gas emissions over the next eight years.
If implemented effectively, net-zero emissions pledges could limit warming to 2.2 °C, close to the Paris Agreement target of below 2 °C. However, many national climate plans delay action until after 2030. The report finds that reductions in methane emissions from the fossil fuel, waste and agricultural sectors could help narrow the emissions gap and reduce warming in the short term.
"Climate change is no longer a problem of the future. It is a problem now," said Inger Andersen, executive director of UNEP (UN Environment Programme). “To stand a chance of limiting global warming to 1.5°C, we have eight years to cut greenhouse gas emissions by nearly half: to plan, implement policies, implement them, and ultimately cut Eight years. The clock is ticking hard."
As COP26 delegates conclude talks, we can expect climate action to accelerate in the real economy: at the system level, across countries, across industries and within organizations. However, the net-zero commitments made are holding back the formation of supply chains, market mechanisms, financing models, and other solutions and structures needed to facilitate the world's decarbonization path. For businesses, these conditions will create opportunities to innovate and lead coordinated action by industry peers, value-chain partners, capital providers and policy makers. They also present the additional risk that commodity prices will rise globally.
To have any chance of limiting global warming to 1.5 °C, the world has eight years to take an additional 28 gigatonnes of CO2 equivalent (GtCO2e) from annual emissions, which are in the updated NDC and other 2030 commitments. has been promised. To put this number in perspective, carbon dioxide emissions alone are expected to reach 33 gigatons in 2021. When all other greenhouse gases are taken into account, annual emissions are closer to 60 GtCO2e. So, to have a chance of reaching the 1.5°C target, we would have to cut greenhouse gas emissions by almost half. For the 2°C target, the additional requirement is less: a drop in annual emissions of 13 GtCO2e by 2030.
The net-zero commitments made at COP26 came from all stakeholders—governments, financial institutions, companies, multilateral organizations, and others—who must participate to solve systemic problems. For example, the transition to clean shipping would require customers to request the service, shipping companies to invest in ships operating on zero-emissions fuels, fuel producers to make more of those fuels, And banks will need to provide capital for these efforts. And when these activities are coordinated, they change the entire operational context for companies.
COP26 also saw new commitments from groups such as the Glasgow Financial Alliance for Net Zero (GFANZ). In many cases, net-zero commitments are being carried out by various global companies ahead of their plans. Relatively few businesses have yet to have a clear, detailed plan for how they will achieve net zero. This is what leaders should now focus on; Investors and regulators expect them to do so. Britain's Chancellor of the Exchequer Rishi Sunak reiterated at COP26 that the Treasury would require UK-listed companies to issue net-zero plans by 2023. It is only a matter of time before regulators and supervisors follow that example.
Financial institutions have been at the forefront of the campaign to cleanse zero, and they continue to advance at COP26. GFANZ brought together more than 450 institutions, representing $130 trillion in financial assets (40 percent of the global total), who pledged to align their portfolios with net-zero goals. Various analysts estimate that a net-zero transition would require $150 trillion in capital expenditure, two-thirds of which would be in developing economies. While there is fair debate about what the GFANZ treaty could mean in terms of capital investment – and that far more capital would be needed – the commitment shows that capital is starting to build up.
The challenge now is to deploy enough capital quickly to achieve net zero. At a systems level, the focus should be on growing the markets and institutions that can invest money in decarbonization and adaptation. This includes expanding voluntary carbon markets, restructuring multilateral development banks, creating platforms for developing countries and futures markets for green goods.
Extreme weather will not be the only climate-related threat to supply chains in the coming years. As demand for materials with lower emissions intensity increases, such as green steel, production capacity may not be growing fast enough to keep pace, at least in the near term.
Companies would like to prepare for tight supply and upward pressure on their costs. Some businesses are closing in on buying contracts for commodities such as Green Steel. It may also be possible to hedge the price difference between conventional materials and zero-emissions options - although this would require trading capabilities that few companies outside the financial sector have.
For manufacturers of steel, cement and other materials, the increasing demand for zero-emissions items constitutes an opportunity, which can be met only if they decarbonise their base of installed assets. Doing so would take significant capital as well as technology and time.
Further warming will have physical consequences, and warming is set to continue. The Sixth Assessment Report of the Intergovernmental Panel on Climate Change concluded that further changes in Earth's systems are off limits, no matter how much warming. What's more, several climate-modeling efforts based on COP26 pledges show that continued warming will raise temperatures by more than 1.5 °C above pre-industrial levels.
The physical threats posed by climate change have revealed human impacts. For example, in a scenario-based analysis of Race to Resilience, a campaign led by the United Nations High-Level Climate Champions, in a scenario where there is 1.5°C of warming by 2030, nearly half of the world's population is at risk of becoming a climate threat. may come into contact. Relating to heat stress, drought, flood, or water stress. And compared to high-income countries, low-income countries such as Pakistan have larger populations that are likely to be exposed to at least one climate threat.
A recent study on the Climate Risk Country Profile placed Pakistan among the top risk countries in terms of average temperature rise and resultant social and economic losses.
The study noted that Pakistan is facing a significantly higher average temperature increase than the global average, with a potential increase of 1.3°C-4.9°C by the 2090s compared to the 1986-2005 baseline Pakistan has faced some of the highest disaster risk levels, the study said. The world ranks 18th out of 191 countries on the Informed Risk Index 2020
Pakistan is the fifth most climate sensitive country in the world. Between 1998 and 2018, according to the Global Climate Risk Index, climate-related disasters in the country are estimated to have killed about 10,000 people and caused about $4 billion in damages from 152 extreme weather events over that period. Analysts estimate Pakistan's climate migrants at around 30 million people over the past decade.
Despite any debate about whether COP26 was successful, the general direction for countries and businesses has been established. Momentum has shifted towards Net Zero, which gives businesses a new organizing principle.
The transition to net zero will be complicated. The best leaders can expect this to be relatively orderly, and not caused by sudden, unexpected changes.
So courageous leadership will help navigate the transition. Leaders will need to cut down on the noise and articulate a direction for the future, backed by a detailed plan to get there.
Pakistan has a short-term strategy to deal with issues like climate change. Every government wants a policy or a project which can be completed during its tenure. But it will not work in case of environment. There is a need for a policy based on a long-term vision to deal with these issues.
Besides water scarcity and melting glaciers, the monsoon is changing, directly affecting the country's already struggling agricultural output. Pakistan is a multi-threat country in terms of its vulnerability to climate change. Much more needs to be done to protect the environment and local communities from the ravages of climate change.
Pakistan has recently launched an "Eco-systems Restoration Fund" to support nature-based solutions to climate change and facilitate the transition towards environmentally resilient initiatives covering afforestation and biodiversity conservation . Pakistan has officially started the process of creating a National Adaptation Plan to build resilience to climate change. All these efforts should be given top national priority with the ownership of all the key stakeholders. The time to act is now.
