Where's the urgency?
An issue on the city voices at the UN Climate Action Summit, the main changes in the IEA’s latest Net Zero Roadmap and the insurance sector’s retreat from climate risks
The world is not taking climate change seriously. Despite the voices of cities and other subnational governments, of climate scientists and citizens who voted for politicians thinking they would act on climate, global leaders are failing to take appropriate action.
Extreme weather events this year provided a terrible warning of the risks posed by a warming world. Record wildfires, deadly floods, and punishing droughts received the world’s media attention but once again failed to steer its political agenda.
It’s not just climate. Global leaders are falling short of other commitments. In the words of United Nations Secretary-General António Guterres, the Sustainable Development Goals (SDGs) need “renewed impetus and accelerated actions”.
Mr Guterres hosted the Climate Ambition Summit on September 20th in New York City at the UN General Assembly, to showcase those who are taking action—what he calls the “first movers and doers” who are responding to the necessity of taking bold action today. Mayor of London and C40 Cities Chair Sadiq Khan and California Governor (and former Mayor) Gavin Newsom both spoke passionately about what they and their peers are doing to tackle the climate crisis and reduce the world’s reliance on fossil fuel by half by 2030. Other C40 mayors echoed Mr Khan’s message and reinforced their commitment for a fossil-free future.
An updated roadmap to Net Zero
The bold leadership cities have already demonstrated is sorely needed in other political stages too. Just this week, the International Energy Agency (IEA) published an update to their landmark Net Zero Roadmap that makes it crystal clear: the path to limiting global warming to 1.5°C is narrowing, but it is still open.
In the IEA’s original Roadmap, published in 2021, getting to net zero by 2050 relied heavily on technologies not yet available on the market, as they delivered nearly 50% of the emissions reductions needed. In just two years, that number has fallen to about 35%, showing that technology is not a barrier to effective climate action if political leadership starts to listen to the doers, not the delayers, when it comes to climate action.
Insurers are getting cold feet and leaving the public sector to pick up the tab
In spite of the lack of action from national politicians, we may still be nearing a turning point. Often referred to as the “canary in the coal mine” of the global financial sector, the insurance sector is signalling that it is increasingly unwilling to insure climate risks and that existing insurance is not sufficient to cover upcoming damages.
Although some claim that the unwillingness of insurers to cover certain US States is explained by building cost inflation and demographic factors (at-risk areas in Texas and Florida have seen their resident population boom in recent years), it is self-evident that these would not be insurmountable barriers were it not for the increased likelihood of more frequent and more extreme weather events due to climate change. A recent report on the relationship between financial and economic models and climate science from the Institute and Faculty of Actuaries was very clear: economists and bankers “have ignored tipping points, rainfall changes and indoor work, leading them to under-estimate climate change’s economic damage”.
If no insurers step up to cover climate risks, the burden will likely fall on cities and national governments, who will be effectively required to act as insurers of last resort to protect their residents. This will be a tremendous challenge for municipal and public finances, which are already struggling to find resources to address the impacts of climate change.
🎧 Listen to the Cities 1.5 Podcast
The second season of Cities 1.5, our podcast produced in collaboration with the University of Toronto Press, is out. You can listen to it wherever you listen to podcasts or by following these links to Apple Podcasts or Spotify.
And if you want to find out more about the work of the International Energy Agency, catch up on an episode from the first season of Cities 1.5 (here on Apple Podcasts or Spotify) which includes an interview with Brian Motherway, IEA’s Head of Energy Efficiency.
📚 What we are reading
The New Yorker’s reporting on the USA’s liquified fossil gas (LNG) buildout and the risks it poses to tackling climate change globally is timely and important. Research from C40 Cities on the topic is in the pipeline.
We’re also looking forward to Bloomberg’s Akshat Rathi upcoming book Climate Capitalism as we are curious to see if the book is a mostly techno-optimist point of view (much like Bill Gates’ 2021 How to avoid a climate disaster) or if any consideration is given to the aspects of Capitalism that are causing climate change in the first place.