On 12 November the negotiations at COP26 officially ended and the two-week long conference concluded in the Glasgow Climate Pact. The expectations for the climate summit were high after this years' extreme weather events and the release of the IPCC’s latest report, which confirmed that human activities are, without any doubt, warming the planet. The overarching goal that needed to be achieved in Glasgow was to “keep the goal of 1.5 degrees Celsius alive”, as UN Secretary General António Guterres stated at the World Leaders Summit at the beginning of COP26. Now it is time to take stock of the intense discussions. Next to the countries' efforts to agree on how to further reduce greenhouse gas emissions and finance the net-zero economy, carbon dioxide removal solutions like direct air capture received increased attention as a strategy to reach the 1.5°C goal. Read below to learn more about what the outcomes of the conference mean for the direct air capture industry and which major climate targets and alliances were introduced in Glasgow.
The COP26 negotiations yielded important results, such as the finalization of the Article 6 rulebook, which will support the creation of a transparent and stringent carbon dioxide removal market. Moreover, the US-China joint statement on future climate cooperation also references direct air capture. However, many initiatives that were announced on the side also have major implications for direct air capture. Carbon dioxide removal is no longer just included in climate models but concrete actions are being proposed to deploy the relevant technologies.
For example, the “EU-Catalyst” program that was announced on the sidelines of COP26 aims to mobilize $1 billion over the next five years to “boost investments in critical climate technologies”, including direct air capture. The program is a partnership between the European Commission, the European Investment Bank and Breakthrough Energy Catalyst and should lower the cost of such technologies. Similarly, the newly launched First Movers Coalition aims to create catalytic market demand for emerging climate technologies, specifically also mentioning direct air capture. The Coalition is a public-private partnership between the US State Department, through Special Presidential Envoy for Climate John Kerry, the World Economic Forum, and several major companies like Amazon, Apple and BCG have signed to the Coalition.
In addition, the US Department of Energy announced its Carbon Negative Shot, a government-wide initiative to reach affordable, scalable and permanent carbon dioxide removal capacity and achieve US net-zero ambitions. Not only that, the US Congress, while COP26 was happening, also passed a large-infrastructure package that includes substantial deployment funding for direct air capture in the US.
Taken together, these initiatives demonstrate that there is increasing public-private cooperation to accelerate the scale up of carbon dioxide removal in general and direct air capture specifically. It is an incredibly promising sign and COP26 has shown that governments, the public and the private sector can and need to work together to solve the challenge that lies ahead of us.
Countries pledge to further curb greenhouse gas emissions
Compared to the Paris Agreement, the text of the Glasgow Climate Pact contains stronger language to describe the role of fossil fuels in the climate crisis. Although the language of the text was weakened towards the end of the negotiations, the Pact calls for a ‘phase down’ of coal power and fossil fuel subsidies. This is the first time that a climate agreement contains a pledge to reduce the use of fossil fuels, which is why some stakeholders believe that “a signal has been sent that the era of coal is ending”.
The burning of coal emits CO2 and is the largest contributor to climate change. But there is another potent greenhouse gas that was addressed at COP26: more than 100 countries pledged to cut their methane emissions by at least 30 percent from 2020 levels by 2030 in the Global Methane Pledge, which was led by the United States and the European Union. Methane is a potent, though short-lived, greenhouse gas and has been described as the “lowest-hanging fruit” to reduce global warming. However, major emitters like China, Russia and India have not signed the Pledge yet.
A new carbon market framework
Progress was also made in the area of emissions trading. Carbon markets have long been criticized as being too fragmented, unregulated and having opaque pricing. Now, at COP26, the so-called Article 6 rules were created, which should help to regulate the market better. These rules had been a contentious topic in negotiations since the Paris Agreement, which is why the finalization of the Article 6 rulebook is generally regarded as a success, even though some concessions had to be made. In the mid- to long-term, this will support the creation of a stringent international carbon dioxide removal/direct air capture market. Being climate pioneers, the Swiss and Icelandic governments have already started on the creation of said market under Article 6 rules.
Finance for forests and the net zero economy
A pledge that was launched at the beginning of the climate summit that has garnered a lot of attention is the promise to end and reverse deforestation by 2030. By now, more than 140 countries have signed the Glasgow Leader’s Declaration on Forests and Land Use, which represent more than 90% of the forest area worldwide. In terms of financing, the pledge includes almost $19.2 billion in public and private funding. The pledge reminds of the New York Declaration of Forests launched in 2014 but this time, the finance for the ambitions is included and key countries like Brazil, Russia and China are part of the list of signatories.
A significant amount of finance has also been committed by the private sector, specifically finance institutions. Through the creation of the Glasgow Financial Alliance for Net Zero, a total of $130tn has been promised to transform the global economy to net zero. Over 450 firms across the entire financial spectrum are part of this new alliance and have committed to high ambition, science-based targets. All members of the Alliance will report their progress and financed emissions on an annual basis.
Increased cooperation between the United States and China
The end of COP26 came with a surprise announcement. The United States and China, the world’s two largest emitters, agreed to boost their climate cooperation over the next years. The joint statement that they released mentions direct air capture as an area of future cooperation while also being first time that China publicly referenced direct air capture. Furthermore, the two countries state that they recognize that there remains a significant gap between the current efforts to tackle the climate crisis and the efforts that are needed to reach the goals of the Paris Agreement, which they intend to close.
Each year, the COP requires all Parties to agree unanimously on the final outcome document – in this case, the Glasgow Climate Pact. Therefore, similar to how we need to acknowledge the caveats that come with many of the decisions, it is important to recognize the wins. The Paris Rulebook was completed, and several new targets and partnerships were introduced. As the COP26 President Alok Sharma argued in his closing remarks, the conference has kept 1.5° alive but “it will only survive if we keep our promises and translate commitments into rapid action”. Supporting carbon dioxide removal solutions like direct air capture and storage is one of many ways in which the public and private sector can take concrete climate action, and COP26 has shown that this is increasingly recognized.