Landmark Paris Agreement to enter into force

Thursday 6 October 2016

With over 55 parties covering more than 55 per cent of global greenhouse gas emissions ratifying the Paris Climate Change Agreement on Thursday, the landmark accord will enter into force in 30 days.

COP21 celebration
World leaders rejoice the adoption of the Paris Climate Change Agreement on December 12, 2015. Less than a year later, the landmark accord is about to enter into force.
The UN’s top climate official today praised nations across the globe for acting swiftly to bring the landmark Paris Climate Change Agreement into force.

“This is a truly historic moment for people everywhere. The two key thresholds needed for the Paris Climate Change Agreement to become legal reality have now been met,” said Patricia Espinosa, executive secretary of the UN Framework Convention on Climate Change (UNFCCC).
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“The speed at which countries have made the Paris Agreement’s entry into force possible is unprecedented in recent experience of international agreements and is a powerful confirmation of the importance nations attach to combating climate change and realising the multitude of opportunities inherent in the Paris Agreement,” she said.

In a statement issued before the threshold for ratification of the Paris Agreement was crossed, UN Secretary-General Ban Ki-moon said: “Strong international support for the Paris Agreement entering into force is testament to the urgency for action, and reflects the consensus of governments that robust global cooperation is essential to meet the climate challenge.”

The Paris Agreement was adopted in Paris, France at the UN climate conference in December 2015. In order to enter into force, at least 55 Parties accounting for at least 55 per cent of global greenhouse gas emissions were required, with the Agreement then entering into force 30 days later.

Entry into force bodes well for the urgent, accelerated implementation of climate action that is now needed to realise a better, more secure world and to support also the realisation of the Sustainable Development Goals.
Patricia Espinosa, executive secretary, UN Framework Convention on Climate Change
Today, the UNFCCC secretariat tracker shows that the number of Parties that have ratified, accepted, or approved the Agreement now covers over 55 per cent of global greenhouse gas emissions. This includes the biggest and smallest emitters, the richest and the most vulnerable nations.

“Above all, entry into force bodes well for the urgent, accelerated implementation of climate action that is now needed to realise a better, more secure world and to support also the realisation of the Sustainable Development Goals,” Ms. Espinosa said.

“It also brings a renewed urgency to the many issues governments are advancing to ensure full implementation of the Agreement. This includes development of a rule book to operationalise the agreement and how international cooperation and much bigger flows of finance can speed up and scale up national climate action plans,” she added.

Consequences of entry into force
Entry into force triggers a variety of important consequences, including launch of the Agreement’s governing body, known as the CMA. In the parlance of the UN climate change process this stands for the Conference of the Parties to the Convention serving as the meeting of the Parties to the Paris Agreement.

Given that the count-down to entry into force has now been formally triggered, the CMA will take place at the upcoming annual UN climate conference, known as COP22, in Marrakesh, Morocco from November 7-18. Precise dates will be announced in the coming days.

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Moreover, the Intended Nationally Determined Contributions (INDCs) – national climate action plans – of Parties which have joined or subsequently join the Agreement transform into Nationally Determined Contributions (NDCs), which can always be resubmitted as more ambitious plans at any point. A key feature of the Agreement is that these plans can be strengthened at any time but not weakened.

“Climate action by countries, companies, investors and cities, regions, territories and states has continued unabated since Paris and the full implementation of the agreement will ensure that this collective effort will continue to double and redouble until a sustainable future is secured,” said Espinosa.

Governments will also be obligated to take action to achieve the temperature goals enshrined in the Agreement – keeping the average global temperature rise from pre-industrial times below 2 degrees C and pursuing efforts to limit it to 1.5 degrees.

The fact that somewhere around one degree of this rise has already happened and global greenhouse gas emissions have not yet peaked underlines the urgency of implementing the Paris Agreement in full.

Another key milestone will be the successful conclusion of negotiations to develop the Paris Agreement’s implementation rule book. Completion of what is, in effect, a global blueprint for reporting and accounting for climate action, need to be completed as soon as possible.

Countries are also not starting from scratch. The many successful models and mechanisms for international climate cooperation set up under the UNFCCC over the past two decades, including the Kyoto Protocol, have built up a deep level of experience and knowledge on how this can be done effectively.

It is the completed rule book that will make the Agreement work and that will make it fully implementable, setting out the detailed requirements under which countries and other actors will openly report and account for the climate action they are taking in a way which promotes trust and confidence across nations to boost their own comprehensive response to the challenge of climate change.

Another key issue is to ensure that the $100 billion, pledged by developed countries to developing ones, is truly building in the run up to 2020 and that even larger sums are being leveraged from investors, banks and the private sector that can build towards the $5 to $7 trillion needed to support a world-wide transformation.

Securing a world which is safer from the extreme climate change that would undermine any attempt at future sustainable development will still take decades of rising action and constant improvement.

“The entry into force of the Paris Agreement is more than a step on the road. It is an extraordinary political achievement which has opened the door to a fundamental shift in the way the world sees, prepares for and acts on climate change through stronger action at all levels of government, business, investment and civil society,” said Espinosa.

China ratifies Paris climate agreement

An aerial view shows a coal-burning power plant on the outskirts of Zhengzhou, Henan province, China, August 28, 2010.
 REUTERS: Signing up to cut emissions means China will have to move away from coal power

China’s top legislature has ratified the Paris global climate agreement, state news agency Xinhua reports.

The country is the world’s largest emitter of harmful CO2 emissions, which cause climate change.

China and the US are expected to jointly announce ratification at a bilateral summit later on Saturday.

In a landmark deal struck in December, countries agreed to cut emissions enough to keep the global average rise in temperatures below 2C (36F).

What is climate change?

What does the climate deal mean for me?

Members of China’s National People’s Congress Standing Committee adopted “the proposal to review and ratify the Paris Agreement” on Saturday morning at the end of a week-long session.

The Paris deal is the world’s first comprehensive climate agreement. It will only come into force legally after it is ratified by at least 55 countries, which between them produce 55% of global carbon emissions.


Paris agreement: Key points

  • To keep global temperature increase “well below” 2C (36F) and to pursue efforts to limit it to 1.5C (27F)
  • To peak greenhouse gas emissions as soon as possible and achieve a balance between sources and sinks of greenhouse gases in the second half of this century
  • To review progress every five years
  • $100bn a year in climate finance for developing countries by 2020, with a commitment to further finance in the future
  • Once the deal comes into force, countries that have ratified it have to wait for a minimum of three years before they exit

When the US – the world’s second-largest emitter – follows China’s lead, it will bump the tally up to 40%.

Before China made this announcement, the 23 nations that had ratified the agreement accounted for just over 1% of emissions.

Top 10 CO2 emitters

Analysts warn that the target of keeping temperature rises below 2C is already in danger of being breached.

For 14 consecutive months meteorologists have recorded the hottest month on record, and the UK’s Met Office has forecast that 2016 is likely to hit temperatures 1.1C above pre-industrial levels.

Average temperatures worldwide are likely to increase more in the coming years as the effect of previous carbon emissions makes itself felt.

The G20 summit in Hangzhou, starting on Sunday, is a meeting of leaders from 20 countries. It is expected to be Barack Obama’s last trip to Asia as the president of the US.

Mr Obama is expected to announce on Saturday that the US is formally joining the Paris Agreement.

It is thought that he and China’s President Xi Jinping will make a joint announcement at a bilateral meeting.

CEO Pavilion Energy & Chairman of International Enterprise (Singapore) joins as Honorary Adviser

Elion House is pleased to announce the addition of Seah Moon Ming as Honorary Adviser. He is Group Chief Executive Officer of Pavilion Energy, Singapore’s integrated energy company owned by Temasek. Chairman of  International Enterprise (IE) Singapore, the government agency that partners Singapore companies in going global and promotes international trade. IE vision is a thriving business hub in Singapore with Globally Competitive Companies and leading international traders. IE has a global network of overseas centres in over 35 locations which provides the necessary connections in many developed and emerging markets.

Mr Seah is also Chairman of Singapore Cooperation Enterprise, Trusted Board Ltd and China & North Asia Business Group of Singapore Business Federation. He also sits on the board of Singapore Technologies Electronics and Alexandra Health System Pte Ltd.  Mr Seah is a member of the Board of Trustees, SIM University, Singapore and Adjunct Professor at its School of Science & Technology.  He was Chairman of Temasek Polytechnic from 2006 to 2014.

He was conferred the IES/IEEE Joint Medal of Excellence Award 2008 by the Institution of Engineers Singapore (IES) and the Institute of Electrical and Electronics Engineers. He received the Honorary Fellow Award from the ASEAN Federation of Engineering Organisations (AFEO), as well as Fellow of the ASEAN Academy of Engineering and Technology (AAET).

Mr Seah is a recipient of the Oil Council’s 2014 APAC Executive of the Year Award. Mr Seah is also a recipient of the 2011 Distinguished Engineering Alumni Award, conferred by the NUS Faculty of Engineering. He was awarded the 2006 Asia Brand Innovation – Ten Most Outstanding Personality Award and the 6th International Management Action Award by Chartered Management Institute, Singapore in 2007.

In January 2008, Mr Seah was conferred the title of Honorary Citizen of Guiyang, China. He was named as one of China’s Top 10 International Chinese Achievers for Financial & Intelligent Persons in 2007 by a consortium of organisations, including the Beijing Normal University and the Chinese editions of Fortune and Time magazines.

Mr Seah holds a Bachelor of Engineering with a major in Electronics Engineering from the National University of Singapore and a Master of Science (EE) with distinction from Naval Postgraduate School, USA. He also attended the Stanford-NUS Executive Program and the Management Development & Advanced Management Program at Harvard University.

Tesla’s Rise Has Inspired a Dozen New EV Rivals

If imitation is the sincerest form of flattery, then Elon Musk should be blushing.

In addition to the increased competition from big auto manufacturers, there are also now many venture-backed startups that are now kicking tires within the electric vehicle industry. According to Tracxn, a startup intelligence platform, some of Tesla’s rivals include Faraday Future, NextEV, and Atieva.

This set of companies has raised hundreds of millions from prominent venture capitalists in a bold effort to emulate the success of Tesla, which had its shares skyrocket from $17 to north of $200 since the company’s 2010 IPO.

Courtesy of: Visual Capitalist

 

TESLA’S RIVALS

Faraday Future is possibly one of the more interesting names on this list. Backed by Chinese internet billionaire Jia Yueting, the company is notoriously secretive and hasn’t publicly revealed its CEO. It has however, hinted that its technology could potentially help mount a serious challenge to Tesla. Faraday Future executive Nick Sampson, the former head of vehicle and chassis engineering at Tesla, said that the company’s goal was to “revolutionize mobility the same way the iPhone revolutionized the phone industry”.

The company plans to build vehicles with a Variable Platform Architecture (VPA), which allows for vehicles to be built with multiple motors, along with powertrain configurations that can be customized for specific power, range and driving dynamics. Faraday Future recently broke ground on its $1 billion Nevada factory, aiming to launch its first vehicle for sale in 2017.

NextEV, another EV startup with Chinese connections, has reportedly raised more than $500 million from big names including Sequoia Capital, Tencent, and Joy Capital. Started by William Li, who previously founded the largest provider of car-pricing data to Chinese dealers, the company has a similar vision to that of Faraday Future: it plans to focus on connectivity and infotainment features to take the EV beyond just a form of transportation. To help guide in this plan, NextEV has hired Martin Leach, who previously served as the president of Ford Europe and also the CEO of Maserati.

Lastly, Atieva has made recent ground in the EV market after securing the majority-backing of one of China’s largest automakers. Founded in 2007 by Bernard Tse, who was also originally on Tesla’s Board of Directors, Atieva initially planned to provide monitoring software for electric vehicle battery packs. Today, the company has now reportedly moved towards manufacturing EVs with the vision of “redefining what a car can be by building an iconic new vehicle from the ground up”.

Building an electric car company from the ground up is a daunting task, and many imitators have already failed spectacularly. Fisker Automotive, for example, famously declared bankruptcy in 2013 even after burning through $1.4 billion in funding while losing $35,000 per car.

It’s possible this list may look way different in the near future.

Read the original article on Visual Capitalist. Get rich, visual content on business and investing for free at the Visual Capitalist website, or follow Visual Capitalist on Twitter,Facebook, or LinkedIn for the latest. Copyright 2016. Follow Visual Capitalist on Twitter.

Elion House on Infrastructure Panel @ Borrowers and Investors Forum

IMG_5780
Elion House, Benjamin Khoo, on the Debt and Infrastructure Financing Panel talks about how Clean Technology Infrastructure innovation can generate superior low-risk yields for institutional investors in the current ultra-low yield environment.
The bespoke real economy asset class is positioned to meet the surging demand by global investors for environment, social and governance (ESG) compliant assets which can generate sustainable and long-term returns.

Panelists:

  • Moderator Kiyoshi Nishimura, Chief Executive Officer, Credit Guarantee & Investment Facility 
  • Rana Karadsheh-Haddad, Country Manager Singapore, International Finance Corporation (IFC)
  • Brian Tang, Managing Director, Asia Capital Markets Institute
  • Benjamin Khoo, Managing Director, Regenerative Energy & Infrastructure – Elion House
The forum heard from a cross-section of governments, investors, issuers and regulators as they discuss the current issues impacting raising debt and the most lucrative sectors in the Southeast Asian market.

Norway’s $863 billion wealth fund bans 52 coal-linked firms

By Stine Jacobsen
OSLO (Reuters) – Norway’s $863 billion (£610.3 billion) sovereign wealth fund, the world’s biggest, said on Thursday it had sold shares in 52 coal-dependent companies from its portfolio as part of a policy to fight climate change.
A Reuters calculation showed the stakes sold were worth at least $1 billion at the end of 2014, before the fund started big divestments from coal. The biggest holdings included a $188 million stake in CLP Holdings <0002.HK>.
Norway’s parliament agreed last year to make the fund, built on revenues from the country’s vast offshore industry, sell out of companies that derive more than 30 percent of their turnover or activity from coal.
The fund listed U.S. firms American Electric Power Co Inc <AEP.N>, AES Corp <AES.N> and Allete Inc <ALE.N> among the firms, along with China Coal Energy Co Ltd <601898.SS> and Coal India <COAL.NS>, the world’s biggest coal miner by output.
Global coal producer Peabody Energy Corp <BTU.N>, which filed for bankruptcy on Wednesday, was also on the list. The fund expects to exclude more firms from its investment universe amid the new rule.
“The intention is to assess the remainder of relevant companies in the portfolio by the end of 2016,” the fund said in a statement.
Norges Bank Investment Management said it had given the companies an opportunity to give views before they were excluded. The fund sent letters to the companies, but only five responded, it said in a statement.
The fund declined to give an overall value of its divestments so far.
The Norwegian finance ministry previously said the curtailment of investments in coal-dependent businesses could lead the fund to sell shares in about 120 companies worth some 55 billion Norwegian crowns (£4.7 billion)..
Martin Norman, climate and energy adviser at environmental group Greenpeace, welcomed the sales which he said were probably the biggest single divestment from coal ever.
“They are setting a new standard when it comes to transparency,” he said. Greenpeace studies have indicated that the fund should sell shares totalling about 80 billion crowns to follow parliament’s instructions to limit exposure to coal.
He said Greenpeace wanted the fund to diversify even further from fossil fuels and that it was wrong to focus only on the climate risks of coal while promoting oil and gas.
The fund has a range of ethics criteria for excluding firms from its portfolio, including severe environmental damage, nuclear weapons making, tobacco production and certain labour conditions.
(Reporting by Terje Solsvik, Stine Jacobsen and Alister Doyle; Editing by Mark Heinrich)
euronews provides breaking news articles from Reuters as a service to its readers, but does not edit the articles it publishes.
Copyright 2016 Reuters.

The Growth of the Responsible Investment Industry

The Growth of the Responsible Investment Industry

By Richard Turley

Socially responsible, ethical, sustainable are all buzz words in the investment industry at the moment. A niche area only a few years ago, new ethically focused products and funds are popping into existence at a rapid rate, while mainstream funds are increasingly trying to keep up by integrating environmental, social and governance (ESG) standards into their investment decision-making.

But what is all the fuss about, and why are environmental and social factors impacting on investment decisions?

Traditionally investment decisions were made based on a complex but rather narrow set of factors. Profit, return on investment, return on capital, gross and net yield were all seen as the core measures to gauge the success of an individual investment and the factors most likely to impact a portfolio’s overall performance.

However, the world is changing rapidly. The market-based economy of the 20th century is rapidly being replaced by a more nuanced economy that is required to take into account the social, environmental and societal impacts of its operations. Different industries have been impacted to a greater or lesser extent, but the trend is consistent across financial markets.

In recent years, asset managers, pension funds and investment companies have been burned too many times using traditional investment analysis that identified investment opportunities that were, based on the models, rock solid. This analysis, however, was flawed. It did not take into account the governance, compliance, leadership or culture of an organisation, factors that can lay dormant for many years, but when they do appear can have a catastrophic impact on a company’s share price and investor confidence.

Take Volkswagen, a profitable giant of the car industry that had largely avoided the problems of its American rivals after the global financial crisis. Investors were happy to include it as a low-risk investment in a wider low-risk portfolio. Yet the impact of Volkswagen’s compliance-avoidance culture led to the emissions-cheating scandal that has seen the company’s share price almost halve. In the long-term, it will surely take many years for its reputation to be repaired, among customers and investors alike, as fines, class actions and poor sales drag on the company over the coming years.

Trustworthy corporate brands take a long time to build based on years of good governance, treating customers fairly and contributing positively to society, but it takes seconds for that brand and consumer trust to be destroyed.

Consumers, governments and non-governmental bodies are increasingly targeting companies that have demonstrated poor governance, show scant regard for environmental standards or have records of poor labour relations. While savvy marketing and good branding allowed organisations to hide many of these flaws in the past, these tactics are now becoming more transparent, and consumers are less likely than ever to trust the corporate behemoth.

Large asset managers are waking up to the fact that their long-term objectives mean that they must pay attention to dormant issues that can rear their heads and negatively impact a portfolio in five or ten years’ time. For example, the Canadian Pension Plan Investment Board stated in its 2014 report that “we consider responsible investing simply as intelligent long-term investing. We believe that firms that take the opportunity to manage ESG factors effectively are more likely to endure, and create more value over the long-term than those that do not”.

Investors are wise to pay attention to ESG factors. In today’s world of social media, a company’s brand reputation can be torn to shreds with a few inopportune words in a media interview, let alone a full-blown disaster due to corporate misgovernance. Poor company culture can have a long-term impact on its brand and a very real short-term impact on a company’s share price if something goes wrong, which it inevitably does if ESG factors are ignored for long enough.

Investors have, therefore, been demanding more choice and a certain insulation from companies with a flagrant disregard for societal norms. This is where the responsible investing industry has started to fill a gap in the market and forced mainstream funds to redesign their investment decision-making practices.

This is not only in the choice of companies in a funds portfolio. Managers are also starting to take more active roles in advocating for companies to implement anything from a split of the CEO and chairman roles to producing a sustainability report for the first time. Active investing requires the investor to pay more attention to the minutiae of corporate governance and to agitate for change where flaws can be seen. Groups of investors can now place significant pressure on an organisation to change its behaviour, update its policies and procedures, or change its leadership.

Socially responsible investing is not a new phenomenon; it can arguably be traced back to religious organisations in the 19th century, such as the Quakers, who avoided “sinful” investments in companies involved in guns, liquor or tobacco.

However, the 21st century has seen a realisation among mainstream investors that not only is responsible investing good for the community and environment, it is also more profitable. Adding an additional lens to investment decisions, one that identifies those risks that do not necessarily appear in a company’s financial statements, is now being seen as critical to the long-term success of an investment portfolio.

This is not a trend that companies and investors are going to be able to ignore. The Financial Stability Board, an international body that monitors and makes recommendations about the global financial system, recently announced the appointment of experts in responsible investment, sustainable finance, risk management and climate change to head its new task force on climate-change-related disclosures. This task force will create a set of consistent voluntary disclosures for use by a company’s investors and insurers to understand an organisation’s environmental credentials. Although voluntary, the pressure on companies to begin reporting on these measures will be strong, given the now global focus on climate change from governments and consumers alike. This will require far greater transparency over the operations and governance of an organisation, allowing investors to make more informed decisions.

Generational changes are also impacting investor behaviour. Investment managers now say that younger investors are more likely to demand responsible investments for their portfolios. This generational change will percolate through the economy as companies that do not effectively address societal concerns will struggle to remain relevant in the long-term. Standard Life Investments cited a recent poll of UK residents that showed that only 39 percent of 18-to-24-year-olds and 35 percent of 25-to-34-year-olds were “more concerned in investing in a company that provides high returns on investment than societal/environmental issues”. This compares with 47 percent of 35-to-44-year-olds.

However, this isn’t just about investing in ethical concerns. Recent research by Morgan Stanley on sustainable investing identified that “investing in sustainability has usually met, and often exceeded, the performance of comparable traditional investments. This is on both an absolute and a risk-adjusted basis, across asset classes and over time, based on our review of US-based mutual funds and separately managed accounts (SMAs)”.

The realisation that sustainable and responsible investing is not only good for the planet and its population but will also provide better long-term returns is leading mainstream investment managers to rush to upgrade ESG policies, launch new products and generally re-brand themselves as socially responsible.

Investors now have a list of factors to add into their financial models. Corporate governance, environmental stewardship, labour relations, community engagement are all indicators of a company’s culture and its long-term success.

The United Nations Principles for Responsible Investment (PRI) launched in 2006 has been instrumental in raising awareness about responsible investment among the global investment community. They have blazed a trail in setting standards for modelling ESG factors into investment decisions, raising transparency around the capabilities and activities of its signatories and fostering collaboration between them. Indeed, the term responsible investing is an evolving term and is quite subjective and dependent on the values and outlook of the investor.

The standardisation of what it means to be a responsible investment fund or an ethical investor, and increased transparency around reporting, will help individual investors make more informed choices that meet their own value propositions.

2016 and beyond will see more responsible-investment products, enhanced sustainability-disclosure requirements for companies, and greater demand by investors for funds and portfolios that fit with specific values and objectives. New categories are also likely to emerge. Recently a trend towards impact investing has seen the growth of investments that aim not only to make a financial return but also to generate a measurable beneficial societal or environmental impact.

The development of the responsible-investment industry and its impact on mainstream investors is a wonderful thing. Allocating money to activities that are beneficial to society in addition to receiving a return will help to improve the lives of millions, and maybe save our planet.

Top lobbying group in historic green energy U-turn

Energy UK, which represents big six providers, says it now supports phasing out coal-fired stations, after years of defending use of fossil fuels
The UK’s biggest energy lobbying group has shifted its position on green energy and will start campaigning for low-carbon alternatives for the first time, in what environmental campaigners are describing as a watershed moment.
Lawrence Slade, the chief executive of Energy UK, which represents the big six providers and has been regarded as a defender of fossil fuels, said the shift was urgent in order not to be left behind.
“No one wants to be running the next Nokia,” he said, referring to the mobile phone company that was overtaken by forward-looking rivals. “I want to drive change and move away from accepted (old-style) thinking.”
Lobbying group has been on wrong side of carbon debate for far too long, so should we really believe that this is more than just words?
This is a major turnaround for an organisation that has historically been criticised by consumer and green groups as a dinosaur protecting the vested interest of incumbent supply companies such as British Gas, SSE and others.
Energy UK now officially supports the government’s phasing out of coal-fired power stations and is critical of ministers over the way they have cut subsidies to wind and solar power so deeply and suddenly.
Slade accepts that the big six, along with ministers, have made plenty of mistakes in the past but he says it is now time to develop a national plan that everyone – especially consumers – can buy into.
Slade said: “It would be quite a sensible thing to have an Energiewende [Germany’s plan to move to a majority of renewable energy sources] but the emphasis would have to be on our own version not a direct cut and paste.” The German energy transition programme has attracted support but also some criticism.
Slade, who formally took over the top job last summer, was talking following the publication of Energy UK’s Pathways to 2030 policy document prepared with the help of professional service company, KPMG.
Amid concern about the lights going out, 60 local authorities argued last weekthat coal-fired power stations should be kept open, but Slade surprisingly disagrees, saying we need lower-carbon solutions.
Energy UK wants to see more demand reduction, plus regulatory changes, to help support electricity storage projects that help balance out the peaks and troughs caused by wind and solar power.
Slade also believes urgent action is required to encourage power companies to keep existing gas-fired plants running, as well as the provision of aid to make it worthwhile for new ones to be constructed.
Energy UK is calling for much more long-term thinking and financing. It says that details on the levy control framework of subsidy levels should be published so that investors have a clear picture up to 2025.
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Slade believes onshore windfarms should be allowed access to new forms of subsidies and says that aid cuts since the last election have undermined investor confidence.
He said: “Energy policy is not as yet coherent. It is becoming clearer but more needs to be done. Investment is there but not forthcoming because there is not black and white clarity [on government policy]. The abruptness of some of the cuts and the scale of some of the cuts have alarmed people.”
Slade said he is keen to move on from arguments of the past and concentrate on solutions as Britain moves away from big central power stations to a more decentralised system of energy.
Catherine Mitchella professor of energy policy at the University of Exeter and a champion of the low-carbon economy, welcomed the apparent U-turn by Slade’s organisation. She said: “Energy UK is the conventional industry lobby, and is generally at the conservative end of arguments.
This [Pathways] report reads almost as if they have ‘flipped’ to the other side. I take this to mean that their members realise that their future is in the ‘new’ energy system rather than the ‘old’, and this is to be welcomed.”
Richard Black, the director of the non-profit Energy and Climate Intelligence Unit, also viewed Energy UK’s new stance as positive. He said: “The report shows that experts across the industry see a time of tremendous change ahead for the electricity system, with the traditional utility model increasingly outdated.
He added: “Falling demand, increasingly competitive renewables, storage, interconnectors, demand response – this is the blueprint for the electricity system just 15 years hence, and it’s telling that it comes from an industry body rather than a ‘green’ thinktank.”

Paris climate change agreement: the world’s greatest diplomatic success

US secretary of state, John Kerry, talks with China’s special representative on climate change Xie Zhenhua. Photograph: Xinhua / Barcroft Media

In the final meeting of the Paris talks on climate change on Saturday night, the debating chamber was full and the atmosphere tense. Ministers from 196 countries sat behind their country nameplates, aides flocking them, with observers packed into the overflowing hall.

John Kerry, the US secretary of state, talked animatedly with his officials, while China’s foreign minister Xie Zhenhua wore a troubled look. They had been waiting in this hall for nearly two hours. The French hosts had trooped in to take their seats on the stage, ready to applaud on schedule at 5.30pm – but it was now after 7pm, and the platform was deserted.

After two weeks of fraught negotiations, was something going badly wrong?

Then at 7.16pm, the French foreign minister, Laurent Fabius, returned abruptly to the stage, flanked by high-ranking UN officials. The last-minute compromises had been resolved, he said. And suddenly they were all on their feet. Fabius brought down the green-topped gavel, a symbol of UN talks, and announced that a Paris agreement had been signed. The delegates were clapping, cheering and whistling wildly, embracing and weeping. Even the normally reserved economist Lord Stern was whooping.

Outside the hall, a “Mexican wave” of standing ovations rippled across the conference centre as news reached participants gathered around screens outside for the translation into their own language. The 50,000 people who attended the summit had been waiting for this moment, through marathon negotiating sessions and sleepless nights.

The contrast with the last global attempt to resolve climate change, at Copenhagen in 2009, which collapsed into chaos and recriminations, could not have been greater. In a city recently hit by terrorist attacks that left 130 dead and scores more critically injured, collective will had prevailed.

Paris produced an agreement hailed as “historic, durable and ambitious”. Developed and developing countries alike are required to limit their emissions to relatively safe levels, of 2C with an aspiration of 1.5C, with regular reviews to ensure these commitments can be increased in line with scientific advice. Finance will be provided to poor nations to help them cut emissions and cope with the effects of extreme weather. Countries affected by climate-related disasters will gain urgent aid.

Like any international compromise, it is not perfect: the caps on emissions are still too loose, likely to lead to warming of 2.7 to 3C above pre-industrial levels, breaching the 2C threshold that scientists say is the limit of safety, beyond which the effects – droughts, floods, heatwaves and sea level rises – are likely to become catastrophic and irreversible. Poor countries are also concerned that the money provided to them will not be nearly enough to protect them. Not all of the agreement is legally binding, so future governments of the signatory countries could yet renege on their commitments.

These flaws may shadow the future of climate change action, but on Saturday night they took second place. As the news spread through the world, the reaction from civil society groups, governments and businesses, was overwhelmingly positive.

Kumi Naidoo, executive director of Greenpeace International, summed up the mood: “It sometimes seems that the countries of the UN can unite on nothing, but nearly 200 countries have come together and agreed a deal. Today, the human race has joined in a common cause. The Paris agreement is only one step on a long road and there are parts of it that frustrate, that disappoint me, but it is progress. The deal alone won’t dig us out of the hole that we’re in, but it makes the sides less steep.”

Even as delegates celebrated at the conference’s end, there was a palpable sense of relief from the exhausted French hosts. At many points in this fortnight of marathon negotiating sessions, it looked as if a deal might be beyond reach. That it ended in success was a tribute in part to their diligence and efficiency and the efforts of the UN.

“France has brought openness and experience in diplomacy, and mutual respect to these talks,” said Stern, one of the world’s leading climate economists. “They have taken great care to make everyone listened to, that they were consulted. There was a great sense of openness, of professional diplomacy, and skill.”

Saturday night was the culmination not only of a fortnight of talks, but of more than 23 years of international attempts under the UN to forge collective action on this global problem. Since 1992, all of the world’s governments had been pledging to take measures that would avoid dangerous warming. Those efforts were marked by discord and failure, the refusal of the biggest emitters to take part, ineffective agreements and ignored treaties.

For these reasons, the Paris talks were widely seen as make-or-break for the UN process. If they failed, collective global efforts would be at an end and the world would be left without a just and robust means of tackling climate change.

The threat was catastrophic and the stakes could scarcely be higher. Without urgent action, warming was predicted to reach unprecedented levels, of as much as 5C above current temperatures – a level that would see large swathes of the globe rendered virtually uninhabitable. What is more, infrastructure built today – coal-fired power plants, transport networks, buildings – that entail high carbon emissions will still be operating decades into the future, giving the world a narrow window in which to change the direction of our economies.

“This was the last chance,” said Miguel Arias Canete, Europe’s climate chief. “And we took it.”

The terrorist attacks on Paris raised questions about whether the talks would go ahead at all but François Hollande, the French president, insisted that they must and, in a show of unity, more than 150 heads of state landed in the French capital for the opening day. Barack Obama hailed the conference as “an act of defiance” in the face of terrorism.

Immediately after the attacks, the first concern was for security. A planned march through central Paris by protesters was cancelled, though a version of it did go ahead as the talks opened and was marred by clashes with police and a small number of protesters, and arrests. Security for the conference was stepped up, with police and army patrolling the immediate area and transport routes nearby shut down for two days.

This was the biggest ever gathering of world leaders, whose presence was needed to empower their negotiators to move out of positions entrenched for more than 20 years. When they arrived, a series of key meetings were held, with Obama seeing Xi Jinping of China, Narendra Modi of India and representatives from the least developed countries. Hollande concentrated on forging links with the developing world. Angela Merkel, in a private meeting with Vladimir Putin, secured his pledge that Russia would not stand in the way of a deal.

Behind the conference centre gates, French delegates were marshalling their diplomatic forces. They had carefully arranged the conference centre so that their part of the compound – behind barriers staffed by UN guards and secret service officers, unlike the rest of the delegations which were open to access – was directly above the UN’s offices.

Fabius, from his office, could be with Christiana Figueres, the UN climate change chief, for a face-to-face chat within seconds. His fellow minister, Ségolène Royal, was just along the corridor, flanked with the offices of ambassadors and high-ranking officials. Within the buzzing control room, screens relayed pictures of what was happening in each of the conference rooms scattered around the compound and 24 hour news from French and international channels.

But it soon became apparent that things were not going to plan. As countries examined the draft agreement, ministers started raising concerns. On Wednesday afternoon, leading delegations trooped one by one into Fabius’ personal office: Edna Molewa of South Africa, Xie Zhenhua of China, John Kerry of the US, Julie Bishop of Australia.

For South Africa, issues over “loss and damage” emerged – for developed countries, this meant the question of whether developing countries should be entitled to special aid in the event of climate-related disasters; for the developing, it meant compensation and liability, which the US would never agree to. For China, a key sticking point was differentiation – the concept that developing countries have less responsibility for climate change. For the US, some parts of the deal could not be legally binding in order to pass Congress.

Fabius sought to allay their concerns and find a compromise. At 8pm, he convened a new plenary session, at which all countries were able to speak. It carried on through the night.

At this point, it was clear that further efforts were needed. There followed a rapid round of telephone diplomacy. Obama spoke personally to the Chinese leader. Hollande picked up the phone to as many of his counterparts across the world as he could manage.

Finally, after two more days of fraught negotiation, a consensus emerged. None of the major countries wanted to be seen as wrecking a deal that had come so close. All could agree that they wanted an agreement and all made compromises. The EU backed down on having the intended emissions cuts, agreed at a national level, to be legally binding; the US accepted language on “loss and damage”; China and India agreed that an aspiration of holding warming to 1.5C could be included.

For the diplomats involved, the efforts were exhausting. The talks took a personal toll. In the months before the conference, Laurence Tubiana, appointed as special ambassador on climate change, played a key role in liaising with developing and developed countries. Then disaster struck. A week before the COP was scheduled to begin, she suffered a sudden sharp pain. It was acute appendicitis, necessitating emergency surgery. Within days, however, she had resumed her key role. When the deal was signed, she was on the podium, receiving hugs from Ban Ki-moon, Figueres, Fabius and Hollande, a recognition of the sacrifices she had made.

It is easy to forget what an extraordinary event these UN talks were. The UNFCCC is one of the last remaining forums in the world where every country, however small, is represented on the same basis and has equal say with the biggest economies. Most modern diplomacy carries on in small, self-selected groups dominated by richer countries – the G7, the G20, the OECD, Opec – but all 196 states have a seat and a say at the UNFCCC. Agreement can only be accepted by consensus.

If this makes for an unwieldy and frustrating process, it is also a fair one. The poorest countries of the world, so often left out of international consideration, are those which have done least to create climate change, but will suffer the most from it. Only at the UN are they heard.