Transition Risk

Making Sense of COP26: a Short Guide to Reaching Net Zero

As COP26 kicks off in Glasgow, reaching net zero is set to be top of the global agenda. Get acquainted with the why, when and how of reaching net zero.

Monday, November 1, 2021

By Jo Paisley

This week, all eyes are on COP26 and the achievability of the Paris Agreement goals of limiting global warming to ‘well below 2˚C above pre-industrial levels, while pursuing efforts to limit temperature increases to 1.5˚C’. Why is 1.5˚C so important from a risk point of view? How do we assess the likelihood of meeting these policy ambitions? And how does this fit with reaching net zero emissions in 2050? To make sense of it all, let’s first remind ourselves why 1.5˚C is the current focus of attention.

Why focus on achieving 1.5˚C?

When governments signed the Paris Agreement in 2015, the IPCC was asked to further investigate the differences between a 2˚C and 1.5˚C warming scenario. The resulting Special Report on Global Warming of 1.5˚C, published in 2018, provided evidence that the additional impacts from an extra half a degree of warming were substantial.

Jo headshotJo Paisley

Limiting global warming to 1.5˚C instead of 2˚C could result in around 420 million fewer people being frequently exposed to extreme heatwaves, and about 65 million fewer people being exposed to exceptional heatwaves.

In a 2˚C scenario, global mean sea level rise would be 0.1 meters higher by 2100 than in a 1.5˚C scenario. Although this doesn’t sound like a big difference, the greater rise means that up to 10 million more people would be exposed to related risks, assuming no adaptation.  Furthermore, scientists are confident that the sea level will continue to rise beyond 2100, even with 1.5˚C warming, and so slowing the rate of increase is important as it gives us more time to adapt.

Limiting warming will also reduce the impacts on biodiversity and ecosystems, including species loss and extinction, retaining more of their services to humans. Declining ocean productivity, habitat degradation (e.g., coral reefs, mangroves, seagrass), loss of fisheries’ productivity and changes to ocean chemistry are projected to be substantially lower when global warming is limited to 1.5˚C. Approximately 70–90% of global coral reefs are projected to be at risk of long-term degradation due to coral bleaching, with these values increasing to 99% at 2˚C. In part, this is because coral reefs can’t relocate. Coral reefs are important for a number of reasons: they act as natural barriers, protecting shorelines from waves, hurricanes, and storms, and they provide essential habitats and nutrients which support the entire marine food chain.

The negative impacts on biodiversity increase significantly with an extra half a degree of warming: at 1.5˚C warming, 6 percent of insects, 8 percent of plants and 4 percent of vertebrates are projected to lose more than half of the area that they can inhabit by 2100. These percentages double or triple with a 2˚C increase (18 percent of insects, 16 percent of plants and 8 percent of vertebrates).

And these are only a few of the impacts. So overall, limiting warming to 1.5˚C is considerably less risky than 2˚C. But how do we get there?

How do we limit warming to 1.5˚C?

Given that climate science has established a near-linear relationship between cumulative net emissions and temperature increases, stabilizing the global temperature at any level implies that ‘net’ emissions need to be reduced to zero. By ‘net zero’ we mean that the amount of greenhouse gases entering the atmosphere must equal the amount that is removed. Another way to put this is that we need a balance between the ‘sources’ of greenhouse gases and the ‘sinks’.

But how do we know when we need to reach net zero? One way of framing the challenge has been to use a ‘carbon budget’ – that’s the maximum amount of cumulative net emissions that would result in limiting global warming to a particular level with a given probability. As we’ve used up a large proportion of the budget already, the remaining budget is shrinking each year while emissions continue to rise.

Although there are many nuances associated with using carbon budgets to guide climate policy, the IPCC’s Sixth Assessment Report (AR6) states that for a 66% chance of limiting warming to 1.5˚C, the world has a remaining carbon budget of 360GtCO2 – or nine years of current emissions[1]. Put another way, to limit warming to 1.5˚C, GHG emissions must decline by 45% from 2010 levels by 2030 and reach net zero by around 2050. If we were only aiming to limit warming to 2˚C, then we could reduce emissions more slowly – but it still requires a 25% decline from 2010 levels by 2030 and reaching net zero by 2070.

So how likely is it that we can limit global warming to 1.5˚C?

COP26 in November will be the first major stock take on nations’ Nationally Determined Contributions (NDCs) since the Paris Agreement was reached at COP21 in 2015. NDCs are the actions that countries commit to in order to reduce their national emissions and adapt to the impacts of climate change. They are submitted to the UNFCC secretariat every 5 years and they should be progressively ratcheted up in terms of ambition. But the UNFCC’s recent Synthesis Report shows that the current NDCs are way off track to meet 1.5 degrees; indeed, they suggest that emissions by 2030 will be 16% above the 2010 level. This was confirmed by the UN’s 2021 Emissions Gap Report which expanded the assessment to consider announced mitigation pledges for 2030, as well as the new and updated NDCs. It noted how G20 members, for example, do not have policies in place to meet their NDCs, much less net zero.

There is no single ‘1.5˚C warmer world’. The IPCC makes clear that there is no definitive way to limit global temperature rise to 1.5˚C above pre-industrial levels. There are, however, two main types of pathways. One stabilizes global temperature at, or just below, 1.5˚C; the other has global temperatures temporarily overshooting 1.5˚C before coming back down. Those in which we overshoot will involve much more significant risks to natural and human systems. And some climate scientists are now warning global leaders that the cost of breaching the 1.5˚C warming limit will far exceed the costs of achieving it.

When we achieve net zero emissions does not in itself determine peak warming: what matters is total cumulative emissions up to that time. Hence every year’s delay before we start reducing emissions decreases the remaining carbon budget, making it increasingly difficult to limit global warming to 1.5˚C. To minimize the physical and transition risks, how we achieve net zero is really important, not just achieving it. Something to bear in mind when you read about COP26 and net zero ambitions.

[1] Source: Carbon Brief’s In-depth Q&A.


Jo Paisley is the Co-President of the GARP Risk Institute and a leading expert on climate risk management.

We are a not-for-profit organization and the leading globally recognized membership association for risk managers.

weChat QR code.
red QR code.

BylawsCode of ConductPrivacy NoticeTerms of Use © 2024 Global Association of Risk Professionals