Translation: Amal Abdel Wahab
The launch of Earth Day in the 1970s spurred attention to environmental and climate issues globally for the first time. The event has increased social support to establish the Environmental Protection Agency (EPA) to tackle environmental and climate matters. Ever since, Earth Day led to the passage of many environmental laws in the US.
This launch was followed by several attempts until the 1992 Rio de Janeiro Earth Summit took place, devoting attention to climate change at a global level with the passage of the first framework convention on climate. This agreement extracted confessions from developed, rich industrial countries with their historical responsibility for cumulative atmospheric emissions.
Afterward, many tries and recommendations took place until the launch of the Paris Agreement in 2015. This agreement was considered more comprehensive and international, yet less binding and works on less ambitious climate action. It came up with a settlement that pleased all states, namely the Nationally Determined Contributions (NDCs); i.e., every country shall be free to reduce its level of emissions, with no unified or binding standards.
Since the 2015 Paris Agreement, climate action gained momentum and countries have intensified climate action, and many have committed to reaching net zero emissions by 2050, meaning that any additional carbon emissions will be completely offset by carbon emissions withdrawn from the atmosphere.
According to the United Nations (UN), net zero means cutting greenhouse gas emissions to as close to zero as possible, with any remaining emissions re-absorbed from the atmosphere, by oceans and forests for example.
Any remaining residual emissions are balanced by an equivalent quantity of permanent anthropogenic removals so that they cannot be released into the atmosphere by technological solutions (direct carbon dioxide (CO2) capture and storage) or through natural solutions (land restoration and improved forest management), according to the World Bank (WB).
Why is Net Zero Important?
Global temperature increase should be limited to 1.5°C above the pre-industrial levels in order to avert the worst impacts of climate change and preserve a livable planet.
The UN notes that the Earth has already become 1.1°C warmer than it was in the late 1800s, and emissions continue to rise.
To keep global warming to no more than 1.5°C, as recommended in the Paris Agreement, emissions should be lowered by 45% by 2030 and reach net zero by 2050.
How Can Net Zero Be Achieved?
The carbon pricing mechanism, which can take the form of a carbon tax or emissions trading schemes or other equivalent measures such as sector-level regulations, is a key element of the decarbonization strategy.
Green investment and research and development (R&D) support will not be enough to reach net zero emissions by 2050. However, by increasing the cost of high-carbon energy sources, carbon pricing can incentivize a shift to cleaner fuels and energy efficiency.
Moreover, increasing the supply of clean energy sources only will likely lead to lower energy costs and will not incentivize energy efficiency as much, making it harder to reach net-zero emissions targets.
This is because the energy sector accounts for about three-quarters of greenhouse gas emissions. Replacing polluting coal, gas, and oil-fired power with energy from renewable sources, such as wind or solar, would greatly cut carbon emissions.
According to the UN, a coalition of countries, cities, corporates, and other institutions are pledging to get to net-zero emissions. More than 70 countries, including the biggest polluters; China, the US, and the European Union (EU), have set a net-zero target that covers about 76% of global emissions.
Over 3000 corporates and financial institutions are working with the Science-Based Targets Initiative to slash their emissions in tandem with climate science. Furthermore, over 1000 cities, 1000 educational institutions, and 400 financial institutions have joined the Race to Zero and pledged to take rigorous, immediate action to halve global emissions by 2030.
More than 160 companies with $70 trillion in assets have joined forces behind a common goal, namely steering the global economy towards net zero emissions and fulfilling the Paris Agreement goals. Members involve major asset owners and managers as well as banks with the power to mobilize trillions of dollars behind the transition to net zero.
The WB’s Task Force figured out that in order to guarantee that net zero targets are credible and maintain government support, the targets and strategies to achieve them should be transparent, ambitious, and aligned with social and economic development objectives. Additionally, they must apply robust accounting rules so greenhouse gas emission reductions are assessed accurately and double counting is avoided, that is not claimed by more than one country or entity.
Are We on The Right Track?
The UN said we are not on the right track. Commitments made by governments to date are way less than what is required. Current national climate plans, for 193 Parties to the Paris Agreement taken together, would lead to a remarkable increase of approximately 11% in global greenhouse gas emissions by 2030, compared to the 2010 levels.
It further explained that reaching net zero requires all governments to significantly strengthen their NDCs and take bold, immediate steps toward cutting emissions now. The Glasgow Climate Pact called on all countries to revisit and strengthen the 2030 targets in their NDCs by 2022 year-end. However, only 24 new or updated climate plans were submitted by September 2022.
It is worth noting that the top seven emitters, namely China, the US, India, the EU, Indonesia, the Russian Federation, and Brazil accounted for around half of global greenhouse gas emissions in 2020, whilst the Group of 20 is responsible for about 75% of global greenhouse gas emissions.
Carbon in the Real Estate Sector
The World Economic Forum revealed that the real estate sector is responsible for some 40% of global carbon emissions. Hence, green real estate is an unequivocal way to mitigate the climate crisis and a main priority for future investments.
Further, it indicated that unsustainable buildings have become way less appealing and are difficult to get funding, increasing demand for new buildings. Major investors have shown a growing interest in sustainable real estate and the opportunities they offer to capitalize on future-proofing assets.