Home' Trinidad and Tobago Guardian : December 17th 2015 Contents BG20 INTERNATIONAL
BUSINESS GUARDIAN www.guardian.co.tt DECEMBER 17 • 2015
With the new global
climate deal, busi-
nesses around the
world got the long-
term certainty that
they had been
clamouring for. Now they need to back up
the shift to a greener world with cold hard
Many business leaders have praised the
climate deal reached Saturday in Paris, saying
it will help them steer their companies and
the global economy toward a future that limits
emissions of the heat-trapping gases that are
endangering the planet.
A low-carbon future will take way more
than words, though.
The transition from oil and gas to renew-
ables won t be cheap or easy, but after more
than 190 countries signed onto the pact, busi-
ness have a far clearer sense of what types
of energy, products and services will be needed
over the long-term. Business leaders have
long complained that they weren t able to
make investment decisions without a clear
political message on the greenhouse gas emis-
sions blamed for global warming.
"This agreement provides business with
the critical elements which we were calling
for to catalyze a clean, thriving economy,"
said Edward Cameron, policy chief for the
"We Mean Business" coalition of organisations
working with companies such as Google,
Microsoft and Nike to take strong climate
The commitments made in Paris---which
aim to make sure global warming stays "well
below" 2 degrees Celsius (3.6 degrees Fahren-
heit) and include pledges to seek to limit the
temperature rise to 1.5 degrees Celsius---will,
businesses say, help unlock the money needed
to make the transition to a low-carbon future.
Some say trillions of dollars could now be
unlocked in the transition to clean energy.
"We have an opportunity to build a new
economy, and business is poised to help make
it happen," said Richard Branson, the Virgin
Group chief executive said. "The Paris effect
will ensure the economy of the future is driven
by clean energy."
Details of how each country will regulate
emissions---and even what their specific targets
are---must still be worked out. So while busi-
nesses have a general idea of how the corporate
world will change, they don t yet know how
emissions will be penalised and how quickly
the changes will be adopted.
"The implementation of a Paris Agreement
could prove at least as contentious as the
negotiations themselves," declared Kevin Book,
managing director of ClearView Energy Part-
ners in Washington.
And bond-rating firm Moody s says energy
businesses in Europe will continue to be at
the mercy of European Union policy and not
the pact itself. It says the Paris Agreement
"does not provide detailed objectives relative
to greenhouse gas emissions nor does it impose
any legal obligation to limit or reduce them."
In order to reach the climate accord s long-
term goal, countries agreed to set national
targets for reducing greenhouse gas emissions
every five years. That could mean shifting
how energy is produced and consumed, build-
ing different transport systems or changing
traditional farming techniques and logging
China, the world s biggest emitter of green-
house gases, is already the biggest investor
in renewable energy technologies, spending
at US$83.3 billion last year, according to a
report by the Frankfurt School and the UN
Environment Programme. The United States
was a distant second at US$38.3 billion. Many
expect those numbers to continue to grow
quickly as both countries limit the use of coal
to generate electricity.
The pact appears to be already prompting
On Monday, France s business lobby Medef
revealed plans by a group of French utilities
and other companies to work together on
electricity projects in Africa. The idea is to
provide electricity to areas currently without
power and to do so with "non-carbon" or
"low-carbon" energy sources.
Some argue, though, that the agreement s
clear long-term climate goal won t be enough
to change how the world s economies operate
in the short term.
"Despite this weekend s agreement ... we
think a continuation of global energy con-
sumption trends seems more likely than a
dramatic shift away from fossil fuels," says
ClearView s Book.
Although countries like Russia and Saudi
Arabia signed the deal, they face the prospect
of weaning themselves off the very thing
that s made them prosperous: oil and gas.
Oil-dependent economies were among the
most resistant to early suggestions of including
a pledge in the accord to totally "decarbonise"
the world economy, and that language was
softened in the final text.
In Japan, climate initiatives have lagged in
recent years, especially after the country shut
down nuclear reactors following the 2011
meltdown at Fukushima. Japan s aging and
inefficient power grid has hindered its ability
to adapt to the loss of much of its nuclear
power generation, as emissions have surged
along with costs for imported oil and gas.
In Paris, Japanese negotiators kept a rel-
atively low profile.
"Japan shows striking lack of presence,"
said a headline in the Mainichi newspaper.
Even businesses that cheered the agreement
said they can t do it all by themselves, that
governments have to put into action the prom-
ises they have made.
India still plans to double coal output by 2020 and to rely on
the resource for decades afterwards, a senior official said on Monday,
days after 190-odd countries agreed to begin reining in rising
greenhouse gas emissions this decade.
India, the world s third-largest carbon emitter, is dependant on
coal for about two-thirds of its energy needs and has vowed to
mine more of the fuel to power its resource-hungry economy while
also pledging to raise clean energy generation.
"Our dependence on coal will continue. There are no other alter-
natives available," Anil Swarup, the top bureaucrat in the coal
ministry, told Reuters. "Nothing has changed (following the Paris
While India has plans to add 30 times more solar-powered gen-
eration capacity by 2022, there were limitations to clean energy
and coal would remain the most efficient energy source for decades,
he said. Even though many international lenders are turning their
backs on financing new coal projects in favor of gas and renewable
energy, India should have few difficulties in financing dozens more
India is targeting to more than double coal output to 1.5 billion
tonnes this decade.
India says its per capita carbon emissions are far below the world
average and that coal provides the cheapest energy for rapid indus-
trialisation that would lift millions out of poverty. Reuters
The tiniest countries were arguably the biggest
winners in the deal. Tuvalu, Marshall Islands, Mal-
dives, Kiribati and other island nations pushed hard
for two things. First, a global commitment to at least
try to limit Earth's warming to 1.5 degrees Celsius
(2.7 degrees Fahrenheit) compared to pre-industrial
Second, recognition that they're going to need help
to deal with damage caused by rising seas, more ex-
treme weather and other impacts of climate change.
They got both, though with some caveats.
The deal in some ways looks like a wish list from
US negotiators. It has no new legally binding emis-
sions or financial targets, which would have pre-
vented President Barack Obama from accepting it
without approval from the Republican-controlled
Congress. It allows countries to set their own emis-
sions targets, rather than having to negotiate them
with other countries. And it requires everyone, not
just rich countries, to set emissions targets and be
transparent about what they are doing to meet
Almost everyone involved in the talks heaped
praise on France for making the deal come together.
With masterful diplomacy, the French built bridges
and gave every country confidence that its voice was
being heard. France also earned respect for staying
the course despite the bomb-and-gun massacres in
Paris just weeks before the climate conference.
The world's biggest greenhouse gas polluter didn't
have to cross any of its red lines. Though a strict fire-
wall between developed and developing countries is
gone, the deal still reflects different capabilities of
rich and poor throughout the text, a key Chinese de-
mand. Another win for Beijing is that, unlike at the
chaotic climate summit six years ago in Copenhagen,
China wasn't seen as blocking the talks in Paris.
Indian Environment Minister Prakash Javadekar
blended praise with criticism in his post-deal speech,
suggesting he had mixed feelings about the out-
come. Knowing its emissions are expected to peak
later than those of other major economies, India
made sure the text includes some leeway for devel-
oping nations. It reluctantly accepted the 1.5 degree
goal and failed to get the deal to oblige rich countries
to provide clean technology free of intellectual prop-
erty rights to poor ones.
The Europeans didn't come out of Paris looking like
the leaders they want to be---and in many cases
are---on climate change. They helped form a "high-
ambition coalition" of rich and poor countries, but it
wasn't clear whether the alliance was anything but
symbolic. The EU successfully introduced a mecha-
nism in the deal designed to ramp up emissions tar-
gets over time, but caved on demands that the
targets be legally binding.
Oil-rich Saudi Arabia argued against the 1.5-degree
temperature target and a long-term goal to phase
out emissions. It lost both battles. However, the long-
term goal doesn't specifically mention emissions
from fossil fuels, a small win for the Saudis.
The biggest loser in the Paris agreement could be
the fossil fuel industry. The deal signals to busi-
nesses that governments will enact policies over
time to promote a shift toward cleaner energy
sources, such as wind and solar power.
Of course, it remains to be seen whether they fol-
low up on their pledges. In response to the deal, the
World Coal Association referred to projections that
"electricity generation from coal would grow by 24
per cent by 2040" even with the emissions targets
countries have set so far. AP
Winners and losers
now for action
India to push ahead with coal plans after Paris climate deal
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