COP26: The Glass ‘Half Full’ and ‘Half Empty’

COP26: The Glass ‘Half Full’ and ‘Half Empty’

We go beyond the headlines and highlight the good and bad of COP26.

Manuel Antunes
Manuel Antunes

IN THIS PUBLICATION:

  • Conference of the Parties (COPs) are UN-sponsored annual events where country leaders come together to discuss climate policies.
  • Despite a lot of commentary questioning the success of the most recent COP26 (and Biden's nap time), many ambitious objectives have actually been set in this meeting.
  • Updates on carbon credits, phasing down the dependency on coal and methane emissions, and a lower target for global increases in temperature were the key developments.

Recent Sustainable Developments

  • The European battle for the definition of what constitutes an environmentally sustainable economic activity (the EU Taxonomy) continues. The inclusion of nuclear energy as part of the EU Taxonomy has been debated heavily, with France as a big supporter (70% of its 2020 energy production), and Germany a big opponent.
  • During COP26, a newly-formed anti-nuclear alliance was launched, comprising Austria, Luxembourg, Denmark, Germany, and Portugal (read: the belligerents). This alliance argues that nuclear waste is indeed a worry, and that including nuclear energy as part of the EU Taxonomy will shift investment away from sustainable activities towards more polluting ones (i.e. nuclear, which in their opinion is more polluting if we consider the full-cycle production process).
  • Our take: this is a chicken and egg problem as human ingenuity usually kicks in when we know that a problem (or the threat of it) actually exists. If you’re a start-up and see the political headwinds that nuclear is facing, do you really commit your time and capital to solve the nuclear waste problem? Likely not as you have no visibility in terms of the revenue you can make (unless you're an incredibly pro-risk entrepreneur/investor). On the other side, nuclear could be facing significantly fewer headwinds if there was already a solution to nuclear waste… but that same solution likely doesn't exist yet because entrepreneurs and investors have little incentives to solve the problem in the first place. Chicken-and-egg.
  • Opinions aside, 2021 is presenting itself as a record year for nuclear energy funding (halle-f******-lujah).

Conference of the Parties(COP)

COP26 was the 26th meeting of the signatories of the 1994 United Nations Framework Convention on Climate Change (UNFCC), which comprises almost 200 countries (i.e. the entire world). It was held in Glasgow and co-hosted by the UK and Italy (catering the pints and pasta). It followed meetings in Spain, Poland, Fiji, Morocco, France, etc. some of which celebrated big events like the Paris Agreement. These annual meetings are key moments for the involved nations to develop a climate action plan before climate change becomes irreversible.