Net-Zero Transition – May signals of change
We Mean Business Coalition
Here are just some of the signals of change from the past month across transport, energy, industry, land use and the whole economy, demonstrating the transition to a resilient and inclusive net-zero future is accelerating.
Net-Zero Economy
G7 countries have committed to limiting global warming to 1.5ºC after a two-day meeting of the G7 environment and energy ministers. Over 1,000 small and medium companies have pledge to reach net-zero emissions by 2050 via the SME Climate Hub. The Norwegian Finance Ministry, the Nordic CEOs for a Sustainable Future and the Oslo Stock Exchange have declared their support for the recommendations of the TCFD. CEOs and representatives from more than 80 of the largest U.S. businesses and investors have called on the Biden administration and federal lawmakers to support a robust infrastructure package that will address the climate crisis and advance environmental justice. New approved draft legislation will see Germany adopt more ambitious CO2 reduction targets, including cutting its carbon emissions by 65% by 2030 from 1990 levels and aiming for net–zero by 2045. The Spanish parliament has approved a new climate law aiming to cut emissions 23% by 2030, compared with 1990 levels, and with an overall goal of net-zero by 2050. UK and India have agreed on a joint roadmap to combat climate change by 2030 with a series of shared commitments designed to “limit global temperature rises and achieve an ambitious outcome at COP26”. Deutsche Bank will increase its financing aimed at environmentally sustainable projects to about $268bn by 2023. And UK retailers have cut their carbon emissions in half since 2005.
Net-Zero Energy
G7 countries have agreed to stop international financing of coal projects that emit carbon by the end of this year and phase out such support for all fossil fuels, to meet globally agreed climate change targets. Ending all new coal, oil and gas development this year is needed to reach net-zero emissions by 2050 and secure the 1.5°C goal, according to a new IEA report, which calls for ‘radical’ shift towards renewable electricity, forecasting around $5tn in low carbon energy investments required per year by 2030. The EU Parliament has approved a $21 billion Just Transition Fund that will help most coal-dependent regions in the EU shift to climate-neutral economies. Mitsui Financial Group – Japan’s second largest bank by assets – will halt new financing for all coal-fired power plants, becoming the first major Japanese lender to do so, while the Australian investment bank Macquarie will stop financing coal projects by 2024 and the Philippine-based bank Asian Development Bank will end all financing for coal mining and power plants and ban support for oil and gas production. French electricity utility company Engie and Germany’s RWE have joined the Business Ambition for 1.5°C campaign. And new IEA analysis finds there was a record surge in global renewable power in 2020 with its higher growth forecast putting wind and solar on track to match global gas capacity by 2022.
Net-Zero Transport
Danish shipping company A.P. Moller – Maersk and Swiss national postal service Swiss Post have joined the Business Ambition for 1.5°C campaign. Renault could become the first big carmaker to introduce battery-swapping capability in its EVs. Volkswagen-owned brand Lamborghini plans to electrify its entire range by 2024 with a $1.8bn investment in hybrid and all-electric vehicles, while Daimler is considering phasing out ICE cars before its internal target of 2039. South Korea’s Hyundai Motor Group plans to invest $7.4bn in the US by 2025 to produce EVs and upgrade production facilities. EVs will be cheaper to produce than conventional, fossil fuel-powered vehicles by 2027, as a result of falling cost of making batteries, new research forecasts. A major EV charging ‘superhub’ – capable of delivering up to 300 miles of range to cars in less than 20 minutes – is planned in the UK and forms part of a future network of 40 similar sites across the country. And the EU’s top official for the European Green Deal has backed the German Greens’ call for tax and pricing changes to make rail travel more popular than flying.
Net-Zero Built Environment & Heavy Industry
A new Agora Energiewende and CLG Europe joint report explores how European policies could unlock sufficient demand to enable a full-scale shift to climate neutral materials production, supply chains and business models. The UK government has announced a $235.2m spending plan to accelerate the roll out of green technologies across the country’s energy-intensive industries, which could help create up to 60,000 jobs. Hydrogen is the key to decarbonizing hard-to-abate industrial sectors, but can only contribute fully to decarbonization if changes are made to its production methods with a focus on low-carbon electricity sources and carbon capture and storage, a new study suggests. And leading European companies and funds have invested in H2 Green Steel, a Swedish start-up that aims to build the world’s first large factory for emissions-free production of the alloy.
Net-Zero Land Use & Nature-Based Solutions
A tree-planting program in the UK will double the planting of woodland within four years to almost 75,000 acres a year, or about 80m trees, while the country will also provide $71m to support the restoration of 35,000 hectares of peatland by 2025. Australia is introducing a new scheme, which will see farmers rewarding for reducing emissions and improving biodiversity on their land. UK supermarket Co-op has pledged to achieve net–zero carbon emissions by 2040, while calling on the government to make businesses disclose their carbon effects publicly. To limit global temperature rise, new analysis suggests we must invest now to protect, manage and restore ecosystems and land for the future with an ambitious scaling-up of nature-based solutions. The Central Eurasian desert steppe may be more resilient to climate change than originally thought as scientists have developed methods that could increase plant growth and carbon sequestration and potentially provide a negative feedback on climate change. And an area of forest the size of France has regrown naturally across the world since the year 2000, with the restored forests taking in an estimated 5.9Gt of CO2 – more than the annual emissions of the US.