Numerous states, companies, cities and other stakeholders announce increased climate action
More than 60 heads of state and government met on 23 September in New York, at the invitation of the UN Secretary-General, to present their plans for effective climate action. On behalf of Germany, Chancellor Angela Merkel presented the climate package adopted on 20 September and affirmed Germany’s intention of becoming carbon neutral by 2050. The summit focussed on preparation for the resubmission of the Nationally Determined Contributions (NDCs) agreed under the Paris Agreement, scheduled for next year.
A few days after global protests for more climate action and an emotional speech by 16-year-old climate activist Greta Thunberg, 59 countries announced that they would improve their NDCs in the coming year. In addition, 66 countries and numerous cities and towns, regions, companies and investors committed themselves to drawing up a long-term strategy to become carbon neutral by 2050.
Minister Schulze said: "The summit has demonstrated the momentum climate action has achieved in many countries and companies. With the climate action package, the Federal Government has laid a foundation that will allow Germany to assume responsibility and catch up again with the frontrunners. We are not where we want and need to be yet, both nationally and internationally. Now all the energy at all levels is focussed on making further progress with climate action."
The countries’ current NDCs under the Paris Agreement would – even if fully met – lead to global heating of around three degrees Celsius, with catastrophic impacts and a high risk of setting off irreversible and self-reinforcing trends in the earth system. Under the NDC Partnership, Germany is supporting developing countries in updating and implementing their NDCs.
Many announcements were made at the summit. Some examples: Denmark aims at reducing its emissions by 70 percent by 2030 and becoming carbon neutral by 2050 at the latest. Iceland wants to achieve this goal by 2040, Finland by 2035. India is going to install a capacity of 175 gigawatt (GW) from renewable energy sources by 2022 and plans to further increase this to 450 GW. Minister Schulze declared that Germany will join the international alliance to phase out coal. Greece is going to phase out coal-fired power by 2028, Slovakia by 2023. Hungary will also phase out coal and is planning to only use e-buses from 2030 on in the country’s largest cities. Pakistan aims at planting ten billion trees in the next five years. Russia announced it will ratify the Paris Agreement. Qatar will host a climate-neutral World Cup. Luxembourg will provide free public transport starting next year.
The summit also shifted the financial landscape toward a stronger emphasis on climate action. Nine multilateral development banks announced that they will raise their climate financing to 65 billion US dollars by 2025, which is an increase of 50 per cent. Not only France, Germany, Norway and the UK, but also other countries such as Sweden and Luxembourg promised to double their contributions to the Green Climate Fund. The British Central Bank will carry out a climate action stress test for British banks. Twelve major asset managers with a joint capital of 2.4 trillion US dollars, including Allianz SE, announced that they will gear their complete portfolio towards zero net emissions by 2050.
These signals matter more and more in industry, too: The world’s largest container shipping company Maersk is cooperating with ports, fuel producers and others to develop ships with carbon neutral propulsion technology by 2030 and to use them for deep sea routes. Energy companies such as ENGIE, Iberdrola and Orsted have committed themselves to the climate neutrality target. Orsted will achieve this goal by 2025. Sweden and India established the Industry Transition Leadership Group. Members include Germany and German companies such as Thyssenkrupp. The Indian cement company Dalmia said it was going to have negative CO2 emissions by 2040, and the Swedish steel company SSAB announced that it will replace coal with hydrogen for steel production and thus be able to deliver carbon-free steel starting in 2025.
The summit also gave a boost to international cooperation: Different initiatives were presented involving cooperation among public and private stakeholders with the aim of developing and spreading solutions for specific industry sectors. The BMU oversaw the preparations on the issue of climate finance in cities and towns:
Werner Hoyer, president of the European Investment Bank, announced the Leadership for Urban Climate Investments (LUCI) initiative led by the BMU. LUCI will increase the financial resources for climate-relevant urban infrastructure projects in developing countries. To this end, it combines at least ten initiatives with more than 25 partners, including national governments, city networks, financial institutions, international organisations and think tanks. Germany (via the BMU and the Federal Ministry for Economic Cooperation and Development) is planning to provide up to 63 million euros for LUCI initiatives.
An essential component of LUCI is the Cities Climate Finance Gap Fund, which was initiated together with the Global Covenant of Mayors. The Gap Fund is an innovative fund supporting cities in planning green projects and finding the necessary financial resources. With a budget target of at least 100 million euros, the Gap Fund has the potential to mobilise more than four billion euros in investments for infrastructure projects. Germany and Luxembourg are planning to support the Gap Fund with up to 50 million euros.